Wealth management under COVID-19 has taken two steps forward, one step back, recognizing that changing consumer attitudes are forcing wealth managers to adapt in order to survive in a digital market environment during a new market.

Wealth managers must rethink how they segment and serve customers across the wealth chain, new distribution channels will emerge as financial institutions partner with hyper-apps and virtual banks will merge wealth and health needs, leading to goal-based wealth platforms.

Wealth managers must rethink how they segment and serve customers across the wealth chain, new distribution channels will emerge as financial institutions partner with hyper-apps and virtual banks.

Segment the wealth chain

Wealth managers must rethink how to deliver the right services to the right segment at the right price in a compliant manner.

Consumers in the GCC and Middle East are hungry for access to wealth services via apps and online, meaning that many wealth relationship interactions can move to apps, enabling a low-cost, always-on relationship that can become increasingly personalized once data patterns are analyzed.

Consumers in the Arabian Gulf and Middle East are hungry for access to wealth services via apps and online.

High net worth and older clients may still want to speak to a trusted advisor - but in a post-pandemic world, these relationships may move to phone or video-based interactions rather than face-to-face meetings, minimizing the need for office space.

High net worth and older clients may still want to speak to a trusted advisor - but in a post-pandemic world, these relationships may move to phone or video-based interactions rather than face-to-face meetings, reducing the need for office space.

UHNW individuals will only be afforded current levels of relationship manager interaction - and some may still prefer digital or virtual interactions, especially as intergenerational wealth transfer progresses.

Wealthy individuals will only be afforded current levels of relationship manager interaction - some may still prefer digital or virtual interactions, especially as intergenerational wealth transfer progresses.

Wealth managers should ask themselves:

Wealth managers should ask themselves:

To what extent will digital channels become the norm for client interactions, and how will this rationalize our current physical channels?

If our biggest fixed cost is the number of employees and branches, how can digitalization normalize our cost structure?

Reinventing Distribution

Distribution channels may change in every market, for every industry. That's why as major financial institutions look to invest or partner with leading regional applications, including virtual banks and insurance networks, wealth managers are also considering their options for harnessing technology platforms and client bases. While distribution is the main focus, these firms are also likely to leverage data and analytics to learn more about potential clients and tailor their solutions. In this world, lifestyle solutions will become increasingly popular as data enables more relevant, personalized and timely financial offerings.

Wealth managers are also considering their options to harness technology platforms and client bases.

See Wellbeing

As the region's economies begin to recover from the crisis, significant interest is likely to emerge in a broader notion of financial wellbeing, bringing an individual's wealth and health needs together, consumer attitudes towards all aspects of financial wellbeing are likely to change, this will create opportunities for wealth managers and insurers to build convenient wealth services into lifestyle purchases, for example, the ability to save money and buy and secure a vacation should be available in one place - on one trusted platform where consumers plan and achieve their wealth and health goals

It's time to decide what role you want to play in this future market. Will you be a producer or a distributor (owning the customer relationship)?

Will you get there through expansion or partnership? And most importantly, how will you differentiate your brand?

Where does your purpose intersect with your wealth, distribution and well-being sustainability strategies? How will you integrate this purpose at the center of your transformation, engaging customers, employees and the broader ecosystem in the process?

Summary:

In the wake of the pandemic, consumers in the Arabian Gulf and Middle East will seek to leverage digital wealth management solutions. Service providers must adapt quickly by rethinking distribution, moving to wellbeing and embedding purpose at the center of the transformation.