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Online Wealth Management Solution for China Market ppt

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As the online financial services market in China heats up, traditional joint venture or local financial services providers are eager to seek an expedited path to move online too. Here the author tries to explore a viable strategy from the empowering technology perspective for those financial services firms.

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Online Wealth Management Solution for China Market ppt

  1. 1. ONLINE WEALTH MANAGEMENT SOLUTION Yiwei  Chen   Updated  on  2014   yiwei_chen@yahoo.com   For  China  Market
  2. 2. Individual Wealth Management Market Size Chinese HNWI had the largest growth in 2012
  3. 3. China Mainstream Urban Income Structure Courtesy  of  McKinsey  Inc. Chinese mainstream income ratio will grow into 51% by 2020
  4. 4. Enterprise Asset Management Market Outlook 3.44 million private enterprise units in 2013 with 51,830 large size units (>¥10 million registered capital) and 84,620 medium size units (¥5 to $10 million registered capital) ¥4.214 trillion in registered capital
  5. 5. Online/Mobile Partnership Outlook 2013 Search Market Shares Categorized Top Sites
  6. 6. Online/Mobile Partnership Outlook 2012 Top 5 Apps on iPhone Categorized Top Sites
  7. 7. Challenges from Burgeoning Online Players Baidu’s Baidu BaiFa §  Launched on October, 2013 §  Partnered with China AMC Tencent WeChat United Fund §  Launched on December 2013 §  Partnered with China AMC, E FM, GF FM, and China Universal AM Alibaba YuErBao §  Launched on June, 2013 §  Partnered with Tianhong AM NetEase TianJin §  Launched on December, 2013 §  Partnered with Tianjin Jingdong网银在线 to be launched
  8. 8. Online New Player’s SWOT Analysis Strength §  Huge user base §  High brand awareness §  Fully self-service §  Successful partnership with AM/FMCs Opportunities §  Competing with banks once the licenses are granted §  First move advantage §  Technology power houses Weakness §  Simple product offerings hard to meet sophisticated users’ needs §  Guaranteed high return offerings are more like marketing gimmick Threat §  Government policy shift §  Conventional WM/AM/FM firms going online too §  Partnership goes wrong
  9. 9. Challenges for Sustainable Growth Technology Challenge §  Lack of deep online experience §  Underutilized big data asset §  Low agility to business changes Business Challenges §  Overly customized portfolios §  Lack of reach to online users §  Expected to play a truly independent 3rd party role Resource Challenges §  Hard to hire and retain top sales and wealth managers §  Labor cost is proportional to growth Process Challenges §  Lack of process maturity §  Processes and workflows are not fully integrated with other enterprise applications
  10. 10. Strategy to Transform from Off-line to Online Step 1. Set a High Bar for New Online Business Step 2. Think from a fresh business perspective Step 3. Focusing online Step 4. Strategizing Step 5. Implementing the strategy
  11. 11. 1. Set a High Bar for New Online Business Technology Positioning §  Agile to business needs §  Cloud based to provide SAAS/PAAS §  Big Data for business analytics §  Scalable to support huge user base §  High performance §  High security §  Adaptable for oversea expansion Business Positioning §  To become the market leader in the targeted user segmentation §  Organizational transformation and alignment to improve efficiency §  Elevate the capability maturity in process management §  Improve the customer satisfaction From off-line to online is a business transformation rather than a UI makeover
  12. 12. Technology to Serve the Business HNWI Online Subscriber Reseller Online Partner Private Enterprise
  13. 13. Operational Roles §  Sales manager §  Marketing manager §  Customer WM advisor §  CSR §  Financial analyst §  Online partner account manager §  Reseller account manager §  Regulator relationship manager Operational Services §  Financial product planning §  Customer acquisition planning §  Sales management §  Marketing campaign management §  Risk analysis §  Reporting generation §  HNWI prospect lead generation §  Client behavior monitoring and analysis §  Regulatory compliance checking §  Research & analysis Business Processes §  Prospect attraction §  Customer profiling §  Customer financial analysis §  Customer investment planning §  Plan implementation §  Routine account management Business Services §  Client enrollment §  Account opening §  Asset allocation transaction §  Portfolio construction §  Performance projection §  Risk alerting §  Simulation §  Portfolio monitoring §  Client reporting Servicing Channels §  Branch office §  Customer support center (Call centers, social network, etc) §  Customer self-service (Kiosk, online, phone, etc) §  Internet/Mobile partners (B2B) §  Institutional resellers (B2B) Servicing Recipients §  Direct HNWI customers §  Direct online subscribers §  Internet/Mobile partner’s online users §  Institutional reseller’s customers §  Regulatory auditors Interactive WM Servicing Model
  14. 14. 2. Think from a Fresh Business Perspective AM Customer Deep Penetration §  Self-service WM as employee benefit Retain Biz-owner §  Single view of multiple accounts Customer Satisfaction §  Attract young HNWI Aggressively Acquire Mainstream Income Customers §  WM Self-service Brand and Service Awareness to Vast Online users §  Through partnership
  15. 15. 3. Understand the servicing targets URE 19. HNWI Preference for Direct Contact vs. Digital Contact by Age Band, Q1 2013 Age 60+ Age 50-59 Age 40-49 Under 40 Global30.7% 20.2% 24.0% 32.0% 38.2% 23.7% 29.1% 24.8% 22.9% 21.7% Direct Contact Digital Contact FIGURE 19. HNWI Preference for Direct Contact vs. Digital Contact by Age Band, Q1 2013 (% Respondents) Question asked on a 10-point spectrum: Please indicate whether direct and personal contact is more important to you than digital contact (internet, mobile, email) gital contact (internet, mobile, email) more important to you than direct and personal contact? Courtesy  of  Cap  Gemini   Young wealthy generation prefers digital contact
  16. 16. WM Products & Services Priorities Online  Partner   Cloud  APIs Young  Affluent   Professional     Online  WM  Requirements HNWI  WM  Know-­‐how Online  WM   Product  Suite HNWI  Premium   EdiDon Online  Partner   Requirements
  17. 17. Cloud-based Architecture Model HNWI Online Subscriber Reseller Online Partner Private Enterprise Content/ Media Provider Regulator Trading Exchange AM  Business  Services  Management WM  Business  Process  Management Common  Services  PlaGorm AM  Business  Process  Management WM  Business  Services  Management Self-­‐service   Channel Branch  Office   Channel Reseller  Channel Online  Partner   Channel Call-­‐center     Channel Web  Browser  Client Mobile  App  Client B2B  Web  Services OperaDonal   Services   Desktops Big  Data  PlaGorm Financial  Product  PlaGorm Trading   Compliance   Cash  Mgmt   Billing   Client  DB   CRM   SFA Research   Content   Mgmt MoneDzing   PorGolio   Mgmt   Risk  Analysis   DistribuDon   Investment   Channels Compliance   ReporDng Wealth Advisor Researcher CSR Partner Manager Backend Enterprise Applications Sales Manager Executive IntegraDon  Bus Investment Firm Financial Service
  18. 18. Engineering Organization Alignment Product  &   OperaDon   Team OperaDonal   Tools   Team Client  App   Team Data  AnalyDcs   Team Partner   Engineering   Team Architecture   Governance   Team   PlaLorm   Services   Team QA  Team   Financial   Servicing/ Modeling   Team OrganizaDon   Development   Office
  19. 19. 5. Implement the Strategy Business Strategy Implementation Guidelines §  Executive’s buy-in and strong sponsorship §  Secure budget commitment §  Come up with a blueprint to guide through the implementation §  Strong governance and review constantly on the state of the business §  Fine-tune the plan when needed Products & Services Strategy Implementation Guidelines §  Fast time to market §  Scalable operation §  Secure & robust quality of services in the first place
  20. 20. Implement the Strategy (Cont.) Technology Strategy Implementation Guidelines §  Start from a smaller scope to address immediate business needs §  Balance among open-source, commercial out of the shelf, and home-grown technologies §  With long-term technology blueprint in mind for cost-effectiveness Organization Strategy Implementation Guidelines §  Gradually develop and grow the engineering organization with business justification §  Address business continuity and succession planning in longer term §  Maximally leverage and cooperate with other existing organizations
  21. 21. Key Success Factors to Track Online Business KSFs §  User base growth §  Daily active users growth §  User stickiness improvement §  Market share growth §  User traffic growth §  Paying customer base growth §  User satisfaction level improvement §  Lower technology TCO §  ROI Overall Business KSFs §  Total portfolio capital growth §  Lower user acquisition cost §  Online monetization growth §  Ease of regional expansion §  Ease of global expansion §  Per employee revenue contribution improvement (business scalability)
  22. 22. THE END yiwei_chen@yahoo.com  

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