Client ‘disloyalty’ can be a big issue for robo-advisors in Hong Kong
First, the good news for robo advisors. Investors in Hong Kong are keen robo-advice users.
First, the good news for robo advisors. Investors in Hong Kong are keen robo-advice users. That’s half the battle won as picking up new business is not the challenge. However there is an issue. Keeping the business may be much harder than gaining it for robo-advisors in Hong Kong.
I was in Hong Kong recently for the Private Banker International Greater China awards. It is always extremely rewarding to visit this country which is a perfect mix of old and new private banking players.
According to PBI’s sister firm GlobalData Financial Services, on average those using robo-advisors in Hong Kong earn a higher income and hold more financial products, making them an attractive target market.
I got this sense as well. Investors in Hong Kong are keen on robo-advice and admittedly, in a non-saturated market where new business is plentiful this is only good news. But the Hong Kong wealthy clientele is also notoriously ‘disloyal’. They like to try many new providers and also are multi-banked.
Robo-advice players in Hong Kong need to up their game and work hard to build long lasting, successful relationships with this client segment. They need to take a long-term view – getting to know the life goals and behaviours of their clients with the aim of fulfilling them.
Of course, there is no one single solution, but a transparent fee structure, great customer service, targeted communication, and a hint of the human touch should problems arise can work wonders. Retention is always higher when banks exceed customer expectations, and this is certainly the case in the wealth management industry.