Skip to main content

How the Best Wealth Managers Use Predictive Analytics

Over the past five or so years, personal wealth management has morphed into a new industry. In part, this transformation has resulted from new technologies like artificial intelligence (AI) and robo-advisors becoming mainstream resources. In part, it has happened because client demographics have begun to shift younger. The two trends go hand in hand.

Successful wealth management advisors already have taken steps to capture a share of this competitive, fluid market. The new and incumbent firms that are winning clients and managed assets are those that have engaged advanced technology resources for narrowing the funnel, accelerating sales engagement, and personalizing their services.

Predictive Analytics for Business Growth

Deloitte reported that “Big data and advanced analytics are on the cusp of transforming the wealth management industry, with new ways to engage with new clients, manage client relationships and manage risks.” The industry is moving from insight to foresight – knowing what's happening to knowing what may happen or what will happen. Predictive analytics can make a good company great, and a great company can excel even further.

Today, advanced analytics impacts every phase in the customer acquisition funnel and relationship:

New Client Acquisition:

Employ internal and external data (more on those below) to create comprehensive prospect profiles, map relationships, identify new markets, and generate better leads.

New and Existing Client Sales:

Track data to create Net Worth and Share of Wallet profiles, ascertain a client’s potential lifetime value, and measure risk tolerance for various types of funds and advice by correlating transaction and channel data with market events.

Existing Client Advice:
Use information from client surveys and other input sources, tailor portfolio allocations and offer real-time trade/investment ideas based on preferences and market events. Improve Q&A capabilities and person-to-machine advice channels. Existing Client Supervision: Regularly assess the suitability of wealth management approaches to keep each client optimally positioned by comparing personality and investment profiles with investment and trading activities.

Client Retention:

Gather and compare channel and social data on clients to remain informed about their current satisfaction, risk tolerance, interests, and connections, improving retention and referrals.

Across every step in the funnel, use predictive analytics to track and employ critical business results and key drivers like client segments, advisor books, and product penetration, and to assess the adoption and effectiveness of tools and methodologies.

Disrupting ‘One-size-fits-all’ Investment Strategies

Demographics have shifted notably younger. Millennials have overtaken Baby Boomers as the largest adult demographic, bringing with them high wealth potential and a possibility of tremendous customer lifetime value. Predictive analytics helps wealth advisors to understand "value" from the customer's point of view. In particular, the data can spotlight the point at which convenience and price hit a parity that appeals to the new or existing client.

With these insights, wealth advisors are more capable of pinpointing new customer growth opportunities within demographics currently served, as well as those in younger demographics. Both are important.

As Baby Boomers retire, many are revising their goals and risk tolerance. They may have a focus on succession or legacy planning, for instance, and are seeking peace of mind in knowing their investments will support businesses and loved ones for the long term. On the other hand, younger individuals bring a high potential for lasting customer lifetime value because their focus is more likely on generating wealth to eliminate debt, buy property, or start businesses. With the right data points, advisors can understand what each of these clients’ values, their proclivities for types of investments and risk profiles, and even how they like to engage with an advisor—personalizing the strategy and relationship.

Choosing the Right Technologies

Knowing what technology to engage, for whom, and for what specific purpose(s) is a far greater challenge than finding the right resources. As with so many other areas of your business, the target outcome should dictate the resource you choose. In this case, begin by identifying what data is most valuable for identifying, understanding, or serving your prospect or client.

With the end goal in mind, you can gather and employ the data to personalize and nurture the relationship with a high degree of agility.


Social media ‘listening’ is an ideal way to understand what your prospects and clients value, and to refine your offerings and counsel in near real-time. Wealth managers can use tools like Facebook as a search engine, studying posts and responses within a prospect or client’s network to gain a sense of how they value time, life events that may be influencing their decisions, and more.


Predictive analytics does the work of linking data like keywords with precision and no cognitive bias. The benefit of connecting recent information to stored data is clear. Wealth managers can stay on top of changing external factors and personal events influencing things like financial stress (e.g., a lien) or opportunities (e.g., a promotion), so they can confidently and quickly provide appropriate counsel and resources.


Customer Lifetime Value is earned as it is nurtured. Through long-term, consistent data collection scoring, wealth managers can grow a personalized timeline for each client that spotlights patterns, behaviors, and other factors that have – and may in the future – influence their investment decisions. The most useful timelines are those that have been recorded over many periods of study and can be referenced at the immediate point of opportunity to understand how a client or prospect is likely to respond to counsel.

Understanding customers is critical to the continuity of any business relationship but is particularly vital for those relationships that demand a high degree of trust on the side of the client, and a high degree of proactivity on the part of the provider. Digital Foresight is an advanced predictive analytics tool that can quickly identify ideal prospects, individualize client counsel and resources, and prevent churn by informing positive, productive relationships.

The Future of Personalization Analytics Tools

Because they grew into broadly used mainstream resources so quickly, predictive analytics, AI, and cloud technologies have made personalized wealth management a reasonable offering for a firm of any size. Your existing clients and those you’re pursuing are aware that these resources exist and that they can find a wealth advisor who will put them to good use to provide highly intelligent, highly personalized counsel.

It took little time for these resources to go from innovative to expected. The next competitive horizon looks to be proactive personalization. Particularly as the client base spans a broader age range, advisors are discovering that service models, like investment advice, are best if they are individualized. Some clients might request in-person meetings, and some might prefer to get updates via text as needed. Predictive analytics supply data-driven insights about details like contact frequency and formats that shape a consultative relationship that works best for each client.

If it’s not yet apparent, integrating personalization, leveraging predictive analytics tools into your regular course of business is one of the surest ways to find your next generation of clients and nurture them into high-value lifetime relationships. Talk to us to learn what it will take to shorten the time it takes to find and close deals with your ideal targets, and to maintain those relationships with highly personalized engagements.

Let’s engage