2013 may scorpio futurewealth paper 4
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FOREWORD
This final paper in this years Futurewealth series, tackles the complex question of whether a companys
investment in digital communication translates into commercial success when it comes to high-valuecustomers.
Inevitably with a complex question, the answer is not straightforward.
The elite companies tracked in this research have all been recognised for having successful digital marketing
strategies and, almost all of them have increased their standing with their customers in the last year. The
research also highlights that companies which create digital opportunities to connect with their customers
have a greater influence on their purchasing decisions.
So, while we may not be able to establish a direct link, these factors suggest that a digital strategy is more
important when building relationships with the worlds up-and-coming wealthy than many, perhaps, realise.
Indeed, once again, we find that the wealthiest among the Futurewealthy and those in the Asia Pacific
markets are those who are most likely to use digital channels to support their purchasing and investment
strategies.
In fact, this series as a whole has uncovered an important and unequivocal truth: wealthier customers are not
just active online, they are leading the charge on the internet. Any firm and banks in particular simply
cannot afford to ignore this fact.
The time to engage is now.
With that in mind, we would like to thank all those who have taken part in the research and especially the
3,477 of the worlds Futurewealthy, who gave their input and have helped us to understand much more about
their digital habits. We hope these insights will act as an incentive to all those who work with this most
dynamic of customer groups to take some bold steps into the future.
Sebastian Dovey
Managing Partner
Scorpio Partnership
Shayne Nelson
CEO
Standard Chartered Private Bank
Alfred P. West, Jr.
Chairman and Chief Executive Officer
SEI
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IN BRIEF
In this series so far, we have discovered the worlds Futurewealthy are much more digitally-minded than
many might think. You could go so far as to say they are interested, engaged and even inspired by thepossibilities that digital technologies present.
Yet, the big question remains: how can those who serve these demanding customers harness the power of
digital technologies to start, build and deepen their relationships? Or, to put it another way, how will the
future of digital marketing influence this high-powered customer group?
In this paper, we look at leading global companies and consider how their approach to digital channels may
have inspired the Brand Love of their Futurewealthy clients. We look at how good these global firms are at
using digital channels to connect with their Futurewealthy customers. And, we stack up how influential
previous experience and digital information are when it comes to the buying and investment choices of the
Futurewealthy.
As with the previous Futurewealth papers in this series, the findings are based on 3,477 responses from the
worlds up-and-coming wealthy who have an average worth of USD1.9 million.
Bites of the cherry
It is notoriously difficult to work out what inspires a purchasing decision. Yet, logic would suggest that the
more opportunities a company creates to connect with its customers, the more chances it has to inspire their
Brand Love.
For the Futurewealthy, luxury car brands lead the field in this respect. Their use of all channels possible to
connect with and influence this high-value customer group is having an impact on the buying choices of
those customers. We also find they top the charts in terms of the Brand Love they inspire in these
customers.
Perhaps, it is not too much of a stretch to suggest these two facts may be connected.
Digital liaisons
In fact, this year we have focused our Brand Love index on just 16 companies that stand out in their sectorfor having a strong digital identity.All of them have been recognised for their online leadership. And, we find
almost all of them have improved their standing with their Futurewealthy clients in the last year.
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In business, only two things matter:innovation and marketing
In brief
This year our Brand Love index is based on 16 firms that have been recognised for the strength of theirdigital marketing campaigns. It shows that almost all of these elite global brands have improved their
standing in the eyes of the Futurewealthy in the last year. Banking brands stand out for having the largestimprovement at 7.2%.
Yet, it is car companies that continue to be the luxury brand leaders. They also dominate for their digitalinfluence. Indeed, their Futurewealthy customers attribute an average weighting of 6.6 out of 10 to online
information when it comes to influencing their purchasing decisions. This compares to a score of 7.6 for
the influence of their previous experiences with the company.
By contrast, the Futurewealthy clients of banks attribute a weighting of 5.0 to the influence of onlineinformation in their investment decisions, versus 6.8 for their previous experiences with the bank.
And, once again, the wealthiest of the Futurewealthy and those in the Asia Pacific countries attributemore importance to online channels when it comes to their banking partners.
ONLY ONE MARKETING STRATEGY WORKS: FOCUS ON YOUR BEST CUSTOMERS
FIRST, YOUR BEST PROSPECTS SECOND, AND THE REST OF THE WORLD LAST
Last century at what you might call the dawn of the marketing age the way companies measured success
was fairly straightforward. The only unit of marketing achievement that mattered was sales.
How things have changed. Today, the cutting edge of consumerism is not just about shifting stock; it isabout making friends. If your customers love you, the theory goes, then they will come back time and time
again, and they will probably introduce their friends.
It is often called relationship marketing and nowhere is it more apparent than at the luxury end of the market,
because high-value customers can become the very best friends of all. If a company wins their love, then the
relationship can be very fruitful indeed.
However, firms cannot afford to be phoney. High-value customers are highly sophisticated. If a company
wants to win their loyalty, then the friendship has to be genuine.
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Car companies top this superbrand league. However, banks have made the biggest strides forward in the
last year. Yet, they still lag behind other sectors when it comes to making these crucial personal connections.
They would probably argue that it is hard to get people fired up by finance. Yet, as these should be
quintessential relationship businesses, one might expect banks to have more than their fair share of brandwarmth or commitment.
Yet overall, their warmth scores are distinctly chilly at 15 degrees lower than the average across all sectors.
Their commitment scores too are far from balmy, down 14 degrees. And, when it comes to excitement, sadly
things turn decidedly frosty dipping 19 degrees from the elite sector average. To put it mildly, banks have
work to do on their relationship skills.
By contrast, when we look across the leaderboard, superbrands generally are very good at sparking warm
feelings among their Futurewealthy customers. Some also manage to whip up a certain amount of
excitement. But, very few have the relationship recipe right to win the devotion of their customers through
thick and thin [Figure 2].
Figure 2: Brand Love average score per quality including the most and least successful
brands
Index based on responses on three relationship dimensions: To what extent do the brands you use excite
you? To what extent do the brands you use make you feel warm? And, would you stay with the brand, even
if it made a mistake? (Average scores for excitement, warmth and commitment, and the top and bottom
brand in each dimension.)
6964
53
Excitement
average
Warmth
average
Commitment
average
Brand Love index score / 100
Mercedes Benz - 84
American Express - 36
Audi - 83
American Express - 50
Ferrari - 70
HSBC - 36
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Looking in more detail at the index, Singapore Airlines is a good example of a relationship all-rounder, with
solid scores on all three measures. Ferrari and Apple, by contrast, may ignite passion in their purchasers, but
where Ferrari drivers might forgive the odd mistake; Apple owners are less likely to do so [Figure 3].
Among the bank firms, Standard Chartered leads the pack as an exciting and warm brand in its sector. As forthe commitment measure, Futurewealthy respondents indicate they are less willing to pardon banks in
general.
What this shows is that elite brands may have different personalities and different qualities, but the
relationships they inspire can be compared. And, it is fair to say that there are real leaders and followers
when it comes to this particular dating game [Figure 3].
Inspiring this kind of deep brand devotion is particularly important when it comes to high-value customers.
They have a huge range of choices when it comes to spending and investing their money.
#FW2012/2013
68% of the FW around the world with a net worth of over USD4 million own an Apple product, making it
the most popular elite brand in the Brand Love index.
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Figure 3: In pursuit of brand perfection
Brand Love measures the excitement, warmth and commitment
customers feel towards the brands they use. It is an indicator of
the whole relationship they have with that brand.
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THE INTERNET REVOLUTION IS LIKE ALL REVOLUTIONS. BY THE TIME YOU REALISE IT
IS HAPPENING, THE WORLD HAS ALREADY CHANGED
Coming back to the question of how leading firms can use digital technologies to build these kinds ofmeaningful relationships with their high-powered customers, we know the Futurewealthy are digitally-
minded. So, it stands to reason that a firms digital presence will probably influence the brand choices of
these forward-thinking buyers.
Indeed, we find the Futurewealthy have both deep personal and deep virtual relationships with the firms with
which they work. They attribute high-levels of importance to their previous experience with a firm when
making purchasing or investment choices. But, they attribute a similar amount of importance to the
knowledge they can glean about that company through online channels.
Looking first at those successful car brands, their Futurewealthy customers attribute an average weighting of
6.6 out of 10 to the online information about the firm. This compares to a score of 7.6 for the influence of theirprevious experience with the company in their purchasing decisions [Figure 4].
Meanwhile, the Futurewealthy clients of leading banking brands rely more on their previous experience with
the bank when deciding to invest. Online sources of information are more peripheral although each digital
channel has roughly equal weight in the clients mind.
So, Brand Love for banks is currently more likely to be built from one experience to the next. Whereas, for
luxury car providers there is a halo of ever-present influencing factors digital and traditional, direct and
indirect.
This raises the tantalising question: should banks become more like leading car companies? If banks, like carcompanies, created a digital halo of touchpoints, would that create more chances for them to influence their
favourite clients and even deepen their Brand Love?
Given the Brand Love leaderboard sweep of luxury car brands, the simplistic conclusion is: yes, the more
ways a firm connects with customers, the more embedded the relationship becomes.
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Figure 4: Brand influence touchpoints leading car companies and banks
When you last bought a product or service from your provider, how influential were the following factors in
your decision? (Importance on a scale of 1-10 for leading car and banking brands.)
7.6
7.4
6.8
7.2
6.6
6.6
6.1
5.8
6.8
5.5
5.8
5.25.2
4.9
4.5
4.3
Previous experience
Ratings and reviews
Website
News articles
Online marketplace
Search engines
Social networking
Blog posts
Luxury cars Banks
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Reinforcing this conviction, we find this same pattern repeated in the ongoing relationship. Luxury car
providers are more effective at using the digital technologies at their disposal to influence at every point of
contact with their most-valued customers [Figure 5].
By contrast, banks are lagging behind when it comes to these crucial digital information flows.
Figure 5: The quality of digital service leading providers
How good was your provider at using online channels? (Performance on a scale of 1-10.)
Banks may argue that there are factors holding them back from building the digital relationships they desire
with their top clients. Regulation, for example, puts parameters around how financial firms communicate with
their clients. However, by focusing on what cannot be done, these firms are running a serious risk of missing
out on what can.
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GOOD DECISIONS ARE BASED ON KNOWLEDGE, NOT NUMBERS
The digital silence is heard more by some groups of Futurewealthy banking clients than others. Indeed, as we
have found throughout this series, it is the wealthiest of the Futurewealthy who see online channels as a vitalsource of knowledge. When it comes to making decisions about their finances, these high-powered clients
are distilling wisdom from many digital sources [Figure 6].
By contrast, it is the less-wealthy among the Futurewealthy who are more likely to rely more on their
experience with a bank and less on other channels when making their decisions.
This strongly suggests that banks need to gear up most for their wealthiest clients. Because, while personal
experience matters to everyone, for the richest good digital resources matter almost as much.
Figure 6: Brand influence touchpoints leading banks
When you last bought a product or service from your bank, how influential were the following factors in your
decision? (Importance on a scale of 1-10 for leading banking brands by wealth segment.)
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The Asia Pacific markets may be a good reference point. Here, Futurewealthy clients report higher
satisfaction levels with the quality of digital service provided by their banking providers. At virtually every
touchpoint, their banks are creating impact with their use of digital channels by delivering news, views,
information as well as keeping in touch [Figure 7].
Less impressed are the Futurewealthy clients of leading banks in Europe and the Americas, where
satisfaction scores slide. In these regions, banks may be using digital channels pretty well to push
information, but wider knowledge sharing seems to be distinctly lacking. As movers and shakers themselves,
the Futurewealthy in these regions want their banks to flex more digital influencing muscle.
Figure 7: The quality of digital service provided by leading banks
How good was your bank at using online channels? (Performance on a scale of 1-10 for leading banking
brands, by region.)
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IF EVERYTHING SEEMS UNDER CONTROL, YOU ARE JUST NOT MOVING
FAST ENOUGH
So, on balance, it would seem that the companies that have embraced the multi-faceted nature of digitalrelationships have created chances to influence that simply did not exist before. While we cannot say
categorically that digital know-how builds the bottom line for firms; it is a happy coincidence that almost all of
the top 16 companies on our digital leaderboard increased the Brand Love of their Futurewealthy clients in
the last two years.
Car companies have driven fastest and furthest into this new territory. Luxury retail and luxury travel are not
far behind. But, banks are only in the chase.
And yet, in the time it has taken you to read these four short reports 1,643 people around the world have
gone online to search for a wealth manager or private bank.
Whether it is fear or folly holding banks back, their clients are surging ahead. What those Futurewealthy
clients are waiting for is a consistent presence and an authoritative voice providing knowledge and views on
the themes of the day. This conversation has already started for the Futurewealthy; they are just waiting to
hear more than an echo from their wealth advisors.
Indeed, the purpose of all four papers in this series has been to understand more about the digital habits of
the Futurewealthy. Our goal was simply to find the digital footsteps for the firms that serve them to follow. We
hope these digital footprints will lead on the journey from where the Futurewealthy are today; to where the
firms that serve them will be tomorrow.
Through all four chapters of this years Futurewealth report, the refrain has been constant: wealth creatorsare at the forefront of the fast-paced digital revolution and the time to catch-up with them was yesterday.
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A FINAL THANK YOU
And finally, in this our last paper for 2012/2013, we would like to take the opportunity to thank the 3,477
individuals around the world who took time to respond to our online survey in the summer of 2012.
All of those who took part in that research are active wealth creators and the average wealth of this group
was USD1.9 million. Yet equally, they are a diverse group and their varied demographic profiles have
allowed us to compare, contrast, learn and understand [Figure 8].
Collectively, those views have given tremendous insight into the digital habits of those on the fast-track to
fortune. We certainly will look forward to meeting them again in the not-too-distant future.
Figure 8: Demographic profile of Futurewealth participants
Total sample
Broken down by:Level of wealth
Gender and work status
Age and region
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