The Futurewealth report 2012-2013: Stepping into the communication age
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The Futurewealth report 2012-2013: Stepping into the communication age Document Transcript

  • 1. ©2013 Scorpio Partnership. All rights reserved | 0The Futurewealth Report 2012-2013Stepping into thecommunication agePart 2January 2013
  • 2. ©2013 Scorpio Partnership. All rights reserved | 1FOREWORDIn Future Shock, Alvin Toffler famously wrote about the need for adaptability in the 21stcentury.People, he argued, would need to be able to learn, unlearn and relearn to keep pace with theinformation flow.In this second paper in our 2012/2013 Futurewealth series, we find the Futurewealthy areapplying these very skills to their changing communication patterns. Not only are they rapidlyadopting new technologies, as we found in our first paper; they also have a clear understandingof how new communication tools can enhance their interactions with others.Their use of email, web portals, social networking and other digital communication is set toincrease significantly, but not as a replacement for more traditional approaches. Instead, thesenew tools are a supplement offering different qualities and different ways to connect.This research has significant implications for those who serve this valued group of customers. Ithighlights that delivering the personal touch in future will require the ability to make connectionswith clients in many different forms, not to replace time spent face-to-face, but rather to enhancethat personal experience.Interestingly, we also find again that it is the wealthiest and those in Asia who are adapting theircommunication habits most quickly. All this suggests that the race is now on to deliver thecommunication experience that wealthy clients already expect.Sebastian DoveyManaging Partner,Scorpio PartnershipShayne NelsonGlobal Head, High ValueClient Coverage& CEO,Standard Chartered PrivateBankAlfred P. West, Jr.Chairman and ChiefExecutive Officer,SEI
  • 3. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 1IN BRIEFThis is the second paper in our 2012/2013 Futurewealth series, which is based on the views of3,477 of the world’s fast-trackers whose average wealth tops USD1.9 million. We know them asthe Futurewealthy and have been tracing their footsteps for the past four years.This year’s series of four reports aims to uncover the digital habits of the Futurewealthy at work,at play and managing their complex lives. In our first paper, we found the Futurewealthy havewoven digital technologies into the fabric of their lives. In this paper, we examine this themefurther to see just how far they have stepped into the communication age.Consumate communicatorsWhat we find is the Futurewealthy are not just effective communicators; they are, in fact, virtuosiin the art, devoting the time and mastering the skills to make their voices heard. They have, itseems, an intuitive understanding of the qualities of different kinds of communication. So,perhaps it comes as no surprise that the potential of digital communication excites them.Zero to hero communicationsWhile age-old styles of communication remain central to their interactions, new approaches likeemail, web portals, messaging and social networking are moving quickly from zero to hero status.Over a third of the Futurewealthy expect to use these new approaches much more over the nextfive years.This trend extends to their financial relationships, where email and secure web portals look set tobecome key communication channels of the future.Über-wealthy trailblazersMoreover, it is the very wealthiest of the Futurewealthy – those with over USD4 million – who arethe earliest adopters of these new communication styles. They spend 28 hours on digital forms ofcommunication per week, compared with 19 hours among the group as a whole.What is more, they have high hopes that their wealth managers will enter into digital dialogue withthem much more in future.
  • 4. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 2One conversation with a wise manis worth ten years of studyIn brief The Futurewealthy are passionate about many things, including getting their point across. Asa group, they spend 30.5 hours each week in some form of communication or dialogue andthis figure rises to 43 hours among those whose wealth exceeds USD4 million. Of this total time, digital communication on email, web portals, social networking, SMS,instant messaging and VOIP calls accounts for 19 hours. This figure rises to 28 hours for therichest. In other words, the wealthiest of the Futurewealthy are already significantly morelikely to be active online conversationalists. In the future, these figures rise sharply. Over a third of the Futurewealthy expect to use digitalcommunications significantly more in the next five years. And, they expect their wealthmanagers to follow suit.THERE ARE NO STRANGERS HERE; ONLY FRIENDS YOU HAVEN’T YET METFrom cave painting to cuneiform, type-setting to tweeting, every age has had its communicationrevolution. All have been driven by the human need to share information and each has openednew possibilities for self-expression and new levels of personal interaction. As we step into thenew communication age, the possibilities now seem endless and the letters www have become acall sign to the world.In the past four years, we too have taken measured steps into this brave new world using thesesame little letters to reach out and start a conversation with the world’s wealth creators – or as weknow them – the Futurewealthy. Through an ongoing digital dialogue, we have been able to listento their hopes, dreams and expectations for the future.In our latest research, we found that new technologies have become central to the lives andworking habits of the Futurewealthy1. Now, we ask whether they have become virtuosi when itcomes to their virtual communication.1. The Digital World of the Futurewealthy, November 2012
  • 5. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 3#FW2012/2013Those worth under USD500,000spend 25 hours a weekcommunicating with others, 18hours less than theircounterparts worth more thanUSD4 million.CONVERSATION IS AN ART IN WHICH MAN COMPETES WITH ALL MANKINDHumans developed speech for a simple reason; we have a lot to say. So, is it any wonder that theworld’s most influential people are also those who are the most communicative?For the Futurewealthy, communication is vital in all its formsand they spend over 30 hours a week connecting withothers.The wealthier they are, the more they have to talk about.Those with over USD4 million devote almost 43 hours totheir weekly correspondence using a variety of differentcommunication methods.For these wealthiest of the global elite, email is the frontrunner, accounting for almost six hours oftheir weekly interactions. Other kinds of communication are not far behind, including new digitalchannels like web portals, social networking and instant messaging. They are also ready pioneersof new approaches spending, for example, almost three hours a week more on VOIP calls thanthose Futurewealthy who have personal wealth less than USD500,000 [Figure 1].Figure 1: Communication usage (by worth)How much time do you spend using the following methods of communication each week?
  • 6. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 4The Asia Pacific region also stands out for its online experimentalists. The Futurewealthy in thesecountries spend significantly more time in digital dialogue than their counterparts in Europe or theAmericas.Interestingly, social networking is their second most popular digital communication behind email.Asia’s Futurewealthy devote more than 4 hours to social media channels, which is almost doublethe time spent by those in Europe or the Americas.Figure 2: Regional communication usageHow much time do you spend using the following methods of communication each week?
  • 7. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 5Looking into the future, however, it is not just Asia’s elite who are exploring the possibilities ofnew technology. All the Futurewealthy expect to spend significantly more time on digitalcommunications by 2017.Email, it seems, is everyone’s staple. Within five years, almost half the Futurewealthy expect tospend significantly more time on email each week. Indeed, digital connections will almostcertainly be the hero communications of the future for this group as they envisage increasing theiruse of a whole range of digital channels. [Figure 3].However, none of this will take away from traditional methods. The Futurewealthy also expect asteady increase in their meeting and phone time, not to mention good old-fashioned snail-mail.In fact, while over a third of the global wealthy intend to increase their usage of herocommunications in the short term, a further quarter plan to hike in their use of corecommunications. What this implies is that the world’s wealthy are not so-much changing howthey communicate today, they are simply adding new tools to their arsenal.Anyone looking to join their circle of influence will need to keep up in this friendly arms race – in avery real and a very virtual sense.Figure 3: Communication usage increaseHow long do you currently spend using the following communications each week and do you plan to usethese communications more in five years’ time?Time spent communicating each week (hours)%ofrespondentswhowilluse‘muchmore’infiveyears
  • 8. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 6#FW2012/2013Asia’s wealthy currently spendfour hours every weekcommunicating via socialnetworks, an hour and a halfmore than those in Europe andAmerica.THE SMARTPHONE REVOLUTION IS UNDER-HYPED. MORE PEOPLE HAVEACCESS TO PHONES THAN TO RUNNING WATER.As many have observed, it is the scale of digital access around the world that is driving the globalcommunication revolution. And, if we look at the habits of the world’s wealth creators, it is clearthat for them the revolution is only just getting started.Those in the Asia Pacific countries are leading the charge. 56%of them expect to use email much more in the future and thispattern of proliferation is repeated for each communicationchannel, with a notable emphasis on social networking, webportals, instant messaging and SMS [Figure 4].By contrast, those in Europe seem to have had their interestpiqued by specific options. Web portals and VOIP calls standout among their tools of the future. Whereas those in the Americas have a notable bias towardemail and web portals, expecting these to be their channels of choice by 2017.Indeed, the message is coming through loud and clear: the world’s elite expect to communicatemore, in more forms and more often as the next few years unfold.
  • 9. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 7How long do you currently spend using the following communications each week and do you plan to use these communications more in five years’ time?Percentageplanningtouse‘muchmore’infiveyears’timeEmail Meeting Face toFaceTelephone Calls Secure WebPortalSocialNetworkingWritten SMS InstantMessagingVOIP (Skype)56% 36% 40% 46% 47% 28% 40% 44% 33% Asia Pacific41% 24% 19% 31% 23% 17% 25% 19% 19% Americas33% 20% 19% 30% 22% 16% 19% 19% 28% EuropeCurrentweeklyusage4.9 hours 4.5 hours 3.9 hours 3.5 hours 3.2 hours 3.0 hours 3.0 hours 2.6 hours 1.9 hoursFigure 4: Regional communication usage
  • 10. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 8THE ILLITERATE OF THE 21STCENTURY WILL NOT BE THOSE WHO CANNOTREAD AND WRITE, BUT THOSE WHO CANNOT UNLEARN AND RELEARNNot only are the Futurewealthy adopting more tools, these consummate conversationists arequickly adapting their skills into this new communication environment. It seems they recognisethat to become a spider in the world wide web requires an intricate knowledge of where and howto place each thread.Their success is due in part to an inate understanding of what works well when it comes togetting a message across.Email is undoubtedly the bridge thread of the communication web, taking the most strain. This isno coincidence, as they recognise that email is a communication tool that has many strengths. Itis easy to access and efficient, which are all-important qualities for those who are time poor. Itcan also be highly personal, reasonably secure and the string of interactions act as both a log anda prompt for those who have a lot on their minds.What email lacks, however, is a visual quality. Face-to-face contact remains the second mostpopular form of communication for this one vital reason. Meanwhile, telephone calls act as theframe thread in a supporting position.Within this structure, digital communications allow the Futurewealthy to capture the attention of awider network and connect with friends old and new [Figures 5 & 6].
  • 11. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 9Figure 5: Hero communication qualitiesWhich qualities do you associate with each of the following communications? (Percentage ofrespondents who linked these qualities to particular communications)Figure 6: Core communicationsWhich qualities do you associate with the following communications? (Percentage of respondents wholinked these qualities to particular communications)
  • 12. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 10CHANGE IS THE PROCESS BY WHICH THE FUTURE ENRICHES LIVESSo, the challenge for those wishing to get close to the centre of their web, is how to make theright connections with the Futurewealthy. This is a complex conundrum, especially for wealthmanagers, because when it comes to money mum has always been the word.Going forward, the Futurewealthy want to keep a degree of discretion, but not if it keeps themoffline. In fact, we find that they expect to repeat their communication patterns even in this mostsensitive of situations. However, there is one distinct difference: email does not take the top slot.Rather, they expect in future to converse with their money manager through secure digitalchannels much more than today.Indeed, in the matrix of future communications, secure web portals leap up the list for financialinteractions, knocking email, phone calls and meetings into second, third and fourth places.Wealth managers also need to be mindful that instant messaging, SMS, social networking andVOIP are also distinctly evident in the future mix. The Futurewealthy expect to increase their useof these channels in connection with wealth discussions considerably over the next five years.It is also worth noting that these connoisseurs of communication have subtly different preferencesdepending on the kind of investment they are discussing. As a rule of thumb, the more active theinvestment, the more proactive the information flow needs to be. Digital channels featureparticularly prominently for fund-based investments and direct securities [Figure 7].Figure 7: Future investment communication usageOver the next five years, do you expect to be using these communications more, less or the sameamount as you do now when interacting with your main financial provider?
  • 13. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 11And, as a note of caution, wealth providers need to beware of lulling themselves into a false senseof security that their wealthiest clients are those who most value the personal touch. Because,while this is true, it is not the whole picture.The wealthiest of the Futurewealthy – those with over USD4 million – are also those who mostvalue access to a web portal, email, SMS and social networking features. In fact, once again, wefind it is those in the highest echelons of wealth who expect the most advanced kinds ofcommunication from their financial providers [Figure 8].Figure 8: Investment communication usage (by worth)Over the next 5 years, do you expect to be using these communications more, less or the same amountas you do now when interacting with your main financial provider?
  • 14. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 12We also find, once again, that Asia’s zeal for all things technological may result in a very quiet lifefor businesses that ignore their passion. The Futurewealthy in this region expect to use all digitaland non-digital channels much more in the future [Figure 9].Indeed, firms that want to keep up with those sprinting up the wealthy curve will clearly need tomaster many forms of communication in the not-too-distant future. Only those that are ready toadopt this wider repertoire, will be able to forge close connections with Asia’s up-and-comingelite.Figure 9: Investment communication usage (by region)Over the next 5 years, do you expect to be using these communications more, less or the same amountas you do now when interacting with your main financial provider?
  • 15. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 13THE WAY WE COMMUNICATE WITH OTHERS ULTIMATELY DETERMINES THEQUALITY OF OUR OWN LIFEIn our first chapter of this research, we found the world’s wealth creators were optimistic aboutthe potential of digitial technology to enhance their own future success. In this chapter, we findthat to achieve this ambition they are mastering its communication arts.They devote considerable amounts of time to this task and they are experimenting with all theoptions. More than that, they expect to communicate a lot more in the future using not only newtechnology, but also tried-and-trusted techniques.All this suggests that firms wanting to connect with those on the wealth frontier, will need a widerrepertoire of communication styles as well as broad technological toolkit.In fact, if we just look at their financial relationships, the Futurewealthy are already straying awayfrom fail-safe communications to find new ways to stay in touch.And, as we have found before, it is those with the highest levels of wealth and those in the AsiaPacific region who are leading this charge. They have the greatest expectations that their futurefinancial relationships will have multiple touchpoints and will harness new technologies to themax.In our next paper, we will explore this theme further still. Taking as our theme the subject ofhelpful investment technology, we will ask the Futurewealthy directly what kinds of technologythey expect from their financial providers and what they believe will give them the financialrelationships they really want.
  • 16. The Futurewealth ReportStepping into the communication age©2013 Scorpio Partnership. All rights reserved | 14ABOUT THE PARTNERSScorpio PartnershipScorpio Partnership is a pioneer in the art of translating the complex needs of wealthy clientsinto practical, innovative and profitable solutions to target these customers. This award-winningfirm has developed client insight from thousands of millionaires and billionaires around the world.With this knowledge, the firm has implemented strategic research, practical consulting andbusiness innovation projects in over 35 countries.Standard Chartered Private BankStandard Chartered Private Bank is the private banking division of Standard Chartered Bank.Headquartered in Singapore, the Private Bank employs over 1,200 staff, including 450relationship managers, globally. It has 22 offices (with two trust offices) across Asia, Africa,Middle East and Europe.The Private Bank leverages the natural strengths of Standard Chartered: A heritage of over 150years in international banking, a global network across more than 70 countries, and strong localpresence in key growth markets. These put the Private Bank in an advantaged position to growsteadily and deepen client relationships across its core markets.SEISEI (NASDAQ:SEIC) is a leading global provider of investment processing, fund processing, andinvestment management business outsourcing solutions that help corporations, financialinstitutions, financial advisors, and ultra-high-net-worth families create and manage wealth. As ofSeptember 30, 2012, through its subsidiaries and partnerships in which the company has asignificant interest, SEI manages or administers $448 billion in mutual fund and pooled orseparately managed assets, including $195 billion in assets under management and $253 billionin client assets under administration. For more information, visit www.seic.com.Morar ConsultingMorar Consulting was founded to bring new approaches to brand strategy and brandmeasurement to help firms grow the value of their brands. Their work is built on a combination offour key elements: insight, expertise, technology and action.Important InformationAll graphical and image material in this report are sourced by and to Scorpio Partnership.Standard Chartered Private Bank is the private banking division of Standard Chartered Bank (“SCB”). Private banking activities may be carried outinternationally by different SCB legal entities and affiliates according to local regulatory requirements. Not all products and services are provided by allSCB branches, subsidiaries and affiliates. Some of the SCB entities and affiliates only act as representatives of the Standard Chartered Private Bank,and may not be able to offer products and services, or offer advice to clients. They serve as points of contact only.Standard Chartered Bank is incorporated in England and Wales with limited liability by Royal Charter 1853, Reference number ZC 18. The PrincipalOffice of the Company is situated in England at 1 Aldermanbury Square London EC2V 7SB. Standard Chartered Bank is authorised and regulated bythe Financial Services Authority under FSA register number 114276 VAT number: GB 244106593.SEI solutions may be offered internationally by different SEI Investment Company subsidiaries and affiliates according to local regulatory requirements.This material has not been approved by any of the SEI subsidiaries or affiliates as a financial promotion or marketing communication for anyprospective investor. The information contained in this document has not been independently verified by SEI or any legal entity of the SEI Group ofCompanies. This document is not intended in any circumstances as an offer or solicitation to subscribe for or acquire any securities or sale of anysecurities in any jurisdiction.