Recently I attended FundForum International in Berlin, where more than 1,400 investment managers, investors and innovators met for three days of intelligence sharing and networking.
I hadn’t been to Monaco (FundForum’s original location) in several years, but it never struck me as a centre of innovation and nowadays struggles with some negative public perceptions around ‘offshore centres’, regardless of how the industry may feel about it.
Berlin offered a refreshing change - new conference rooms and venues, hotels, and restaurants, as well as a reinvigorated crowd of speakers, delegates and exhibitors.
So, what was on the menu? Here, I’ve pulled out some of the big themes of the conference.
“Data is the new oil and your company is the refinery”
Dr Andreas Weigend kick-started the conference programme with a fascinating look at “data for the people” as we move from physical interactions to social interactions, best summed up by his history of data:
1970s… Building computers
1980s… Connecting computers
1990s… Connecting pages
2000s… Connecting people
2010s… Connecting data – “computers having sex!”
Businesses must get better at not only collecting big data, but learning how to use the relevant customer journey data in unison with the customer’s decision map. Research shows that most financial decisions are based on conversations and shared experiences with friends and family, and until we connect this data, we won’t be selling to the best of our ability. The true value of data lies in its impact on customer decisions.
Mobile is crucial to this success. It’s the most under-utilised medium in financial services and yet it collects the most data, with many more sensors, and is the single most relevant device for an individual’s identity.
The Digital Bill of Rights is also on its way, but we’ll save that for another post…
And if you haven’t checked out www.google.com/history yet, do it now. Apparently I visit government websites quite a lot. Gulp.
You can explore more of Dr Weigend’s work and thinking at www.weigend.com or @weigend, or through the Social Data Lab.
Tech, tech, tech
If conversation was the measure, then technology was the winner at FundForum. Combined with data, it’s influencing and changing every aspect of financial services:
- Creating new investment strategies, and reimagining old ones
- Improving distribution channels and making access more cost-efficient
- Closing the advice gap globally through robo advisers, hybrid models, and next generation platforms
- Encouraging competition – on product, on service, on cost
- Making regulatory compliance faster and easier
- Providing emerging markets customers with access to financial products and services
The application of technology and data is fundamentally changing the way financial businesses acquire, communicate and report to their clients and we’re seeing some very exciting developments in personalisation and automation tools.
But to make data and technology work, there are important challenges for asset managers to face:
- Reconnecting with investors in a world where product providers are increasingly disintermediated from them. Can asset managers win back the client relationship through data and technology?
- Merging sales, marketing and communications teams to leverage every part of the client journey, experience and engagement with the business.
- Choosing a customer acquisition strategy and sticking to it. No business can afford to reach and service all channels all of the time. Choices have to be made.
Impact on asset management
Asset management fundamentally is “big data” – the industry has access to large volumes of data, which is vast in variety and available in real-time. Alongside the technology revolution, data is transforming all aspects of the industry:
- It’s opening up new sources of alpha generation
- It’s creating a new layer of financial advice through robo advisers and hybrid models
- It’s redefining customer acquisition processes (such as insurance) and providing investors with direct access to new ideas (such as P2P or marketplace lending)
- It’s fundamentally changing consumer behaviour forever!
But beware. There is a necessary trade-off. Do your clients know what they get in return for their data? And do your products and services get better over time as a result of their data? Over time, transparency about the data you hold, and competitiveness in terms of how you use it, will separate you from the pack.
Overall, the move to Berlin was a positive change which refocused FundForum on the important issues around investments, technology, regulation, distribution and marketing.
The city has an undeniable energy and youthfulness, and a growing fintech hub, making it a fitting location for learning, networking and selling. And possibly occasional sight-seeing.