Potential BigTech Disruption Demands Accelerated Hybrid Advice Transformation

Asia-Pacific (excl. Japan) wealth management firms are making progress in their push to offer hybrid advisory services. However, none have made a complete hybrid-advice transformation. Firms appear to be struggling as HNWIs’ year-over-year satisfaction with hybrid advice dropped 4.8 percentage points in Q1 2018, compared with the previous year.

 

The pressure on wealth management firms is building as competition expands from peer providers to BigTechs. Significant HNWI interest in BigTech services ― in combination with BigTech expansion into the broader financial services industry ― creates an attractive environment for tech giants to enter the Asia-Pacific wealth management space.

 

HNWIs’ low satisfaction with their primary wealth management firm’s digital maturity and hybrid offerings widens the BigTech entry path to the Asia-Pacific region, especially in major financial hubs (Singapore and Hong Kong). Overall, 87.1% of HNWIs in Asia-Pacific (excl. Japan) said they were willing to start a relationship with a BigTech within the next 12 months.

 

Asia-Pacific firms now realize that investments in the right technologies will help them steer their business model transformation activities.

Asia-Pacific Wealth Report 2018

The Asia-Pacific Wealth Report 2018 from Capgemini is the industry leading benchmark for tracking the evolution in the number of high net worth individuals’ (HNWIs) and their wealth, as well as investment behaviors and practices in the region. The 2018 edition delves deeper into hybrid advice models and how the potential entry of BigTech firms (Google, Amazon, Alibaba, Tencent, Apple etc.) will impact the industry. The report also discusses the ways firms are responding to potential business model shifts to be prepared for future.

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