Asset managers need tech-savy retail-focused approach
A report from Casey Quirk suggests that using smart technology to target and engage with individual investors will be paramount to help asset managers standout from the crowd in an oversupplied industry. Casey Quirk estimates that individual investors represented 90% of net new inflows in 2014 and will account for nearly 120% going forward; adding that over half the world’s asset managers are relying entirely on market growth rather than gaining new assets. The report encourages asset managers to rethink their business models, as investment pools of sovereign wealth funds shrink, baby boomers draw down on pension funds and more institutions bring asset management in-house. Crucially, the report indicates that the cost of targeting retail investors will squeeze profit margins, but smart use of technology to gain new clients should create efficiencies to boost profit margins to similar if not better levels. In essence, the report warns that the rising importance of individual investors will transform competition in the industry and extend the gap between successful and unsuccessful asset managers.

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