On the Short-Sightedness of Banks and Investment Companies Advertising to ‘Wealth Clients’
The wealth adverts running for banks and investment firms in South Africa are some of the most beautiful, gorgeously shot, and emotionally enticing examples of our craft I have ever seen. Heartfelt letters to lovers across the Berlin wall, touching scenes between young child-genius and their poor, but characterful parent, and the inevitable animals running in their natural habitat scene. None of these would be out of place in a top-notch Hollywood drama. They are so achingly beautiful I want to frame bits and pieces of them with their inspired copywriting overlayed on top, and hang them in my office. The sad thing is I don’t think they actually WORK.
I should preface this piece by saying honestly that I have no idea how well these adverts aimed at the elusive Ultra High Net Worth Individual perform. For all I know people are banging down the doors of the banks in droves to hand their hard-earned millions over to the nearest Wealth manager. But I will say that I highly doubt it. Why? Well simply because I think reeling in wealthy individuals is a long-term game, but our banking and advertising structures are geared for the short-term win.
To put things into context, I once spoke to a Private Wealth Manager at one of the big banks and he summed up the situation in one statement:
I know my clients better than their best friends do.
Wealth managers know that one client is supporting an illegitimate love child in Thailand after their last “business conference.” That the other has three children, but is planning to bequeath more to one than the other two. That a different client is squirreling money away into a secret stash to invest into a risky business venture that his wife knows nothing about. The bottom line is; if you know a man’s finances, you know the man. Attracting and keeping wealth is entirely a relationship game.
High Net Worth Individuals are not loyal to a bank. With that much money they are probably banking with multiple local and foreign institutions in any case. They are however loyal to the manager they have their primary financial relationship with. These managers are more than just a convenience to them, they are confidantes — the person the client has literally paid to keep their secrets. This is why wealth and investment managers are so well looked after in financial institutions, and why it is so devastating when they leave. When a great manager goes, so does your lucrative client base.
So, knowing the incredible strength of the bond between the wealthy and the wealth manager, how on earth can any of us justify sinking ten or twenty or even thirty million bucks into a full-scale ad campaign?
No matter how emotionally poignant or well crafted, a 30 second TV spot in gorgeous sepia tones will quite simply never be enough to break up a relationship so important to the wealthy individual. It might raise awareness of the strength of a company’s wealth offering, or maybe even attract a few clients who are feeling disillusioned and actively looking for other options, but they will never add up to impressionable gains in market share.
Ja, well, no, fine…how then DO we build new wealth relationships? Here is where we talk to the value of the long-term game. It is not about slowly prying the existing client loose from their wealth manager. Rather it is about shifting your focus from the guy who currently has tons of dough, onto the guy that will have tons of dough. In their early 30’s or even younger, these guys already have private bankers, sizeable investments and lucrative businesses. It is only a matter of years (possibly months at the rate society moves) until they make the jump from ‘super well-off’ to ‘stinking rich.’ Or to phrase it differently, from ‘private banker’ to ‘wealth manager.’
The money we throw at wooing the already-rich would be far better employed wooing the new up-and-comers who everyone tends to ignore until they really make waves. Some banks/investment firms do take meager stabs at networking events for young entrepreneurs, but these are few and far between, and often framed as a kind of benevolent act. Want to alienate a future African bajillionaire? Act like you’re doing him a favour while charging him fees.
These guys are young, ambitious, black and some of them *gasp* are women. Most of them already have several bank and investment accounts, and are easy to isolate if the institutions they’re with made any effort at all to leverage their large and impressive databases. They are hungry for any kind of interaction and probably haven’t set their financial relationships in stone yet or at all. Most of all, they don’t give a sh*t about those beautifully crafted adverts that are made to appeal to the 55+ white male.
If this sounds like I’m coming down hard on the agencies that made those adverts, it’s not intended that way. I would willingly sacrifice a valuable appendage (or two) to have even half of the raw talent and sheer gusto it took to make something that awe-inspiring. I don’t even hold the brand managers or marketing departments accountable. Rather I suspect these industry players are stuck in a vicious cycle of ‘measurement’ mandated by the bank or institution they work for, that allows them no breathing room to pursue a longer-term strategy.
All companies, financial or not, have business targets they need to meet. Even if they do look at how their performance has improved over several years, the job security, salaries and bonuses payed to their employees are mostly based off of how well they performed that year. That means your marketing manager, even if they are the most visionary strategic thinker in the business, will always brief his agency to come up with a beautiful short-term ad campaign in the hopes of bringing in a few trickles of business, rather than risking his livelihood on a 3–5 year strategy aimed at a younger crew. Short-term results trump potential long term gains every time when you’re hauled in front of your boss to explain your results.
If I’m totally wrong, and some financial institutions are doing awesome things aimed at a younger audience that I just haven’t seen (probably because I’m a fledgling entrepreneur and not a wealthy mogul), then I apologise and would love to hear about it. If there aren’t, then financial institutions aiming for wealth clients need to take a good hard look at who they’re targeting, and how they measure success.
