In the complex world of private banking and independent wealth management, the perception of value cements the bond between a relationship manager and their client. Everyone knows relationship management time is a finite resource.
Before granting discounts, a relationship manager must meticulously evaluate their earnings with a particular client. While flaunting large Assets under Management can impress, real revenue matters most at the end of the day. ๐ผ
Discounts are a possible strategy for securing competitive clients. Yet, this form of client acquisition is no walk in the park. Discounts often tailor pricing for diverse and discerning clientele, but this comes with unique challenges.
Relationship managers often lack insights into revenue and pricing KPIs across various fee layers, including revenue sharing on in-house products. They need software tools to analyse the economic implications of discounts and the internally set targets for Return on Assets. Discounts are often granted without prior knowledge of the ensuing revenue loss. While workflow solutions are standard in many domains, discount approvals frequently rely on unstructured, manual processes, leading to potential errors and inconsistencies. ๐
Given these challenges, relationship managers should exercise caution when offering discounts to ensure each clientโs profitability. Their client book could be reallocated at any time.
Private Banking transcends fee discussions and performance comparisons. Itโs about cultivating relationships and delivering value without sacrificing the bottom line. At its core, private banking focuses on understanding clientsโ unique needs, preferences, and goals. This personalised approach builds trust and loyalty, ensuring clients feel valued and understood.
Do reach out if youโre keen on a straightforward and transparent fee model and aim to be at the forefront of the value chain. ๐ฉ
Source: LinkedIn (SEO adjusted)
