Personalisation has been a major trend in wealth management for many years to the point it is now seen an expectation, rather than as option. As personalisation has become table stakes, what is the next development that will help to differentiate firms from their competition?
The demand for personalisation has been well established over recent years. For instance, a recent report from Capintel claimed 90% of investors prefer tailored investment options rather than standardised options. It has reached a point where not offering personalised capabilities can cost firms clients and this is something firms are aware of. A report from Orion stated that 84% of wealth firms are prioritising personalised financial advice.
Data analytics, AI and direct indexing mean wealth managers can go further than standardised model portfolios to build products that meet a client’s specific financial goals, risk profile, values and life stage. However, this has created a landscape where a firm can no longer try to entice customers with the possibility of personalisation as most competitors are already doing the same. Geert Bernaerts, finance manager at everyoneINVESTED, noted, “But as personalisation becomes increasingly accessible, it is also becoming expected.”
As a result, wealth managers are again looking at their offering and exploring ways they can one-up their competition. For Bernaerts there are two core capabilities that will define the winners in the coming years.
The first is extreme automation behind the scenes. He said, “The leading wealth managers of the future will operate like a “dark factory” where portfolio construction, rebalancing, compliance checks, reporting, onboarding, and client servicing are highly automated. AI and workflow orchestration will remove manual interventions, reduce operational costs, and enable personalisation at scale.”
The second capability will be frictionless client experiences. He stated that clients are not just comparing their wealth management with other financial service providers, but other digital experiences they have every day. This means platforms like Amazon that can provide a perfect, seamless customer experience, influence their opinion on what their wealth manager should be doing.
Bernaerts added, “They expect onboarding to take minutes, investment proposals to be instantly understandable, and interactions to be seamless across channels. Speed, simplicity, and convenience will become just as important as investment performance.”
Both of these capabilities will be strengthened by the gradual transformation toward on-chain infrastructure, he said. On-chain models will make automation more robust, transparent and auditable, while opening the door to smoother, more trustworthy and personalised client experiences.
“This combination is where true competitive advantage will emerge. Personalization alone is not enough. A highly personalized service that requires cumbersome processes and manual effort is difficult to scale. Likewise, a streamlined digital experience without meaningful personalisation risks becoming commoditised.”
There are varying levels of personalisation, with hyper-personalisation being the most detailed form, giving clients highly tailored support. However, Fredrik Davéus, CEO and co-founder of Kidbrooke, believes that many firms are being disillusioned about what real personalisation looks like. Much of what is painted as personalisation is really just better presentation, such as a dashboard with a client’s name on it and a risk score created from a five-question quiz, he stated.
“That isn’t personalisation in any meaningful sense. Real personalisation means the advice actually reflects your circumstances: your assets and debts, your income, your tax position, your goals and the trade-offs between them.”
A hyper-personalised experience is one where the picture is tailored for everyone and updated as their life changes, rather than categorising people into three or four buckets. As this becomes the norm, the next level, according to Davéus, will be about moving the model from static adjustments to continuous adaptation.
He said, “Instead of an annual review that produces a snapshot, the plan reassesses itself as markets move and circumstances change, and flags when something needs attention. The interesting shift isn’t cosmetic; it’s that the depth of analysis once reserved for a private banking client becomes feasible to run for everyone.”
As all wealth managers become able to produce personalised portfolios, what will become increasingly important is the ability to confidentially stand behind them. Can the firm explain how and why the advice ended where it did? Is it consistent across the app, call centre and adviser? Does it hold up if a client or regulator asks for it to be justified in a couple of years. Davéus said, “Trust is the scarce commodity, and trust is earned through coherence and transparency, not through more features. There’s also a straightforward economic point. Personalisation at scale is only a business if you can do it profitably, and that comes down to how modular and efficient your infrastructure is. Plenty of firms can demonstrate personalisation for one client in a pitch. Far fewer can deliver it to a million clients at a cost that works.”
What comes next?
Personalisation has been such a substantial trend and market shift that once it happens across the board, many will be looking at what will replace it as the next major industry development. However, Davéus is not confident it will take on a similar form.
Instead of being defined by a new feature, he believes the next change will be in what people expect a financial provider to do for them. “The expectation is moving from “help me choose a product” to “help me stay on track”, which means continuous, proactive guidance rather than a purchase followed by silence.”
In tandem, Davéus expects the quality gap between the top and the mass market will start to narrow as clients expect the level of advice once reserved for clients with large minimums.
“The next one is about trust and explainability: being able to show clearly how a recommendation was reached. As more of the process becomes automated, the firms that can be transparent about how their advice is produced will have a real advantage over those running something they can’t fully account for.”
Bernaerts, on the other hand, believes the demand for personalisation will continue to grow, going beyond portfolio personalisation and towards personalised financial journeys. As part of this, AI will evolve to continuously anticipate client needs, proactively suggesting actions, automating routine decisions and adapting services in real time.
He said, “Clients will no longer receive a personalised portfolio at a point in time. They will experience a wealth platform that continuously evolves with them. In that future, the winners will not simply be those who know the client best. They will be those who can combine industrial-grade automation with an effortless user experience, delivering highly personalised wealth management with virtually no friction.
“And that is where the next battleground begins.”
