Innerplace concierge: The value of concierge – the extras matter

Date: 11 Feb 2020

Citywealth

Concierge services have long circled the edges of wealth management. They appeared, faded and returned again as firms searched for new ways to build loyalty among demanding clients. Today they are enjoying a renewed moment. Far from simple perks, they have evolved into a strategic tool for private banks and wealth managers who want to understand their clients more deeply and keep them for longer.

Citywealth speaks with Tim Badham, founder and chief executive of Innerplace Concierge, to explore why the model is resonating again. From securing hard-to-reach restaurant reservations and access to exclusive cultural events, to learning how clients spend, travel and live, concierge services are giving firms a clearer picture of personal tastes and daily habits. In the United States the idea has taken a further step with the rise of financial concierge services, which help families map their entire financial footprint, from assets across borders to the rhythms of household spending.

This new wave of concierge reflects a broader shift in private wealth. It strengthens client loyalty, opens the door to the next generation and offers a gentler path into wider conversations about purpose and philanthropy. In an era of intense competition from fintech challengers, the ability to hold clients close has become its own form of advantage.

Concierge services are not a new idea. They’ve been offered in various forms by most private client, focused businesses at some point or another. Yet today they are enjoying a renaissance in the form of a sophisticated business development tool to gain greater insights into a clients’ tastes and spending habits. 

New era of client ‘stickiness’

“There’s been a steady increase of wealth managers offering concierge services like RBC and Scotia in Canada, Merrill Lynch in the USA, HSBC (Jade) in Hong Kong and Coutts in the UK. This concept, as explained above, is not new, it has happened many times before in wealth management, later to be killed off as shareholders lose patience with the cost and intangible returns, so why do it again? “Based on research, providing concierge brings an increase in clients who then remain with the wealth business and are three times more likely to stay than those not using concierge. Other wealth managers, like Barclays, with their successful Infinite credit card and its much-lauded concierge programme validate ongoing research on this topic.

Badham, CEO and founder of Innerplace Concierge who works with major banks says “The reason for this stickiness, could be due to many factors but the rise of social media has undoubtedly helped. Seeing high profile events that are hard to access, makes lifestyle concierge services more compelling. Requests, which might include booking a table at a hot ticket restaurant like Amazonico, tickets to a sold-out show or an upgrade at the Four Seasons, can be sorted like magic. As an example Citibank who call their mass affluent service Citigold Wealth Management, offer clients access to prestigious and unique events, such as Global Citizen which was held at the Royal Albert Hall last year bringing together activists, musicians, artists and world leaders to celebrate and recognise the work that’s being done globally to fight extreme poverty.

Revealing client preferences

“Clients are far more likely to talk about lifestyle services than financial products and this drives acquisition and advocacy.. The other benefit to wealth managers is that they can connect better with their clients because they can learn from use of the concierge to easily develop a deeper understanding of their likes, dislikes and interests.”

Examining money, financial concierge

A less known about offering from the USA is ‘financial concierge’ which is defined as “multi-faceted management of financial matters or a go-to financial overseer‚ where the picture of a client’s affairs becomes even clearer and in minute detail, even down to their coffee habits. The financial concierge becomes like a strategic book-keeper analysing spend across individuals in a family in order to offer meaningful, ongoing advice. Families benefit from a handle on their spending, but more importantly it empowers them to make better decisions, for instance when putting together a trust, to understand true lifestyle needs of different family members and make more accurate provision for them.

What do I own and where?

In addition, “As well as being a useful means of getting the younger generations involved in financial and family matters at both micro and macro level, it gives access to specific areas of a family’s wealth to apportion it to them, explained Victoria Blackburn, senior manager at JTC Private Office based in Luxembourg. Blackburn adds “financial concierge can mean providing individuals and families with a complete overview of their assets and liabilities, both bankable and non-bankable, wherever they are in the world. “This type of service while it does not provide regulated professional wealth management is an extremely valuable tool for families who wish to have a bird’s eye view of all that they own, she explained. “It’s this type of concierge service which has become increasingly valuable given that today many families are international, with a vast array of cross-border assets and liabilities.

Next Gen

Having access to this information and conversations can open up a vast array of opportunities for wealth managers from offering new investment opportunities to meet their evolving tastes and risk appetite, to bringing on board the next generation.

Other ‘sticky’ services, philanthropy advice

Another business development tool offered alongside traditional wealth management is philanthropy, helping clients to pursue passion and ESG projects. UBS has twenty-one dedicated philanthropy advisers in eleven locations on hand to assist wealthy individuals with maximizing the impact of their philanthropy.

Just as lifestyle purchases or choices offered by lifestyle concierge are spoken about more than finances, UBS has found that philanthropy also serves as a positive advocacy tool for the bank with referrals for help with philanthropy being gained from clients’ friends and family members. This is sound thought leadership as research shows that 66 per cent of today’s millennials see social investing as a way to express their values, and 88 per cent of women want to make an impact through investing; which helps UBS engage with prospective and current clients on a meaningful level.

So, despite, previous lackluster encounters for wealth managers offering concierge services, this time around, patience is proving to be a virtue and as Badham explains it will bring prospective clients closer and stop wealth managers losing them. In a FinTech challenger environment, for wealth managers, this must surely be like access to the winning numbers.

www.innerplace.co.uk