Millennials and a shift in buying behavior
I found the following takeaways particularly interesting:
- Institutional and retail customers are expected to continue to drive change in the investment management industry, and both are voicing concerns about fee sensitivity and transparency. Firms that enhance the customer experience and position advice and expertise as components of value will compete better.
- Firms can get in front of these issues by developing efficient data structures to facilitate accounting and reporting and making client engagement a priority.
- Growth in index funds and other passive investments should continue as customers react to market volatility. Investors favor the passive approach in all environments, as shown by net flows.
- Millennials may be less prosperous than their parents and may need to own less in order to fund retirement fully.
- When targeting Millennials, investment managers likely need to consider several steps, for example revisiting product lines, offering socially conscious "impact investments," assigning Millennial advisers to client service teams, and employing digital and mobile channels to reach and serve this market segment.
How are you addressing the needs of Millennials in your organization? If you are looking for a new executive who is savvy about the needs and concerns of Millennial investors, please give us a call.