The debate over the accessibility or exclusivity of wealth management appears now to be reaching a close. One sign of this is the significan...

The debate over the accessibility or exclusivity of wealth management appears now to be reaching a close. One sign of this is the significant increase in the exposure of major banking brands now promoting explicit wealth management propositions through mainstream mediums. Nothing new in that, the banks have been advertising through TV and print for the past few years, but the time slots and carriers for TV ads in particular have typically been the reserve of financial TV broadcasters such as Bloomberg and CNN. Now they are moving into the mainstream.

An example of how wealth management is reaching out to the masses is linked to football. A sport which is effectively filled with overstated underachievers still draws some of the biggest global audiences – the key ingredient for TV advertisement. None more so than nights when the Champions League football is broadcast. Recently, at half time on one of the UK’s independent channels ITV, while average punters were heading to the bar for a refill, the first full-length advertisement was for “You and Us” – the UBS Wealth Management campaign.

The significance of this can be considered from many different angles. First, UBS has chosen to invest in one of the most expensive slots in the advertising industry – half time at a major sports event. Second, UBS has chosen to do this with a wealth management initiative which suggests the bank believes a reasonable portion of the audience are interested parties to the proposition. Third, the concept of wealth management is now one that can be explicitly communicated to the masses effectively.

UBS is not alone. In recent months in the United States and even Europe – which together comprise over half of the total HNW market worldwide – Morgan Stanley and Merrill Lynch have been running broader financial services ad campaigns but they are now hinting more at private investor services. Their campaigns are now closer to UBS and Credit Suisse in promoting the wealth management shop. Meanwhile, globally, Citigroup Private Bank has developed a print ad campaign that runs in learned financial titles including the Economist where the message is on education and identifying key personnel within the Citigroup Private Bank team. Citigroup also runs a television campaign covering the same issues in Bloomberg and CNN. One assumes it is only a matter of time before it also crosses over to mainstream TV.

What does this all mean? In our view, it means that wealth management industry leaders recognise the market has attained consumer status. These major houses – which are among the top 10 institutions operating globally and manage between them over $4.2 trillion in fee-based assets – are entering a game of volume client numbers. Moreover, the major banks in the business, with the major brands, are savvy enough to realise that there is a new battleground – to capture the brand conscious new money targets. These investors would be so hard to reach otherwise (presumably because they are watching football in the pubs).

Winning market share in this game involves different tools. Namely, mass market advertising. This will mean significantly increased budgets for TV and print media. The question is whether the wealth management leaders have the stomach for such investment, which has to be sustained in order to be effective.

The rules of the mass-market game are naturally different from the traditional world of private banking which typically states the majority of business comes from referral. That may have been the case for old school private banking, but institutions looking at the big picture recognise that they now need to nudge the referrals concept with constant reminders of their presence, their viability, their difference and their opportunity. Otherwise, the referrals are not initiated.

In essence, our view is that with the increase in visible campaigns, the market leaders in wealth management are going on to the front foot. They are no longer positioning their proposition as a reactive one – in essence, “smile and the clients will come”. Now, the leaders recognise that being pro-active is going to have to be high on the agenda to attract new money from new clients. They, essentially, must create the opportunity for clients to seek out wealth management, to demand wealth management, to set wealth management as the pinnacle of their financial needs.

Where does this leave the traditional private banking offer? In our view, it leaves it pondering its distinction. The private banking offer must step up its differentials. Wealth management is personal banking for the wealthy mass at scale. Private banking must make its solution distinct from this. The role of a financial aggregator, an institutional investment banking proxy and a strategic asset allocator will have to be placed higher up the agenda. But then there will be issues around the impact on the business model.

But that is another story. For now, we welcome the significant step change in the recognition of branding and reaching out to the mass market. Wealth management is increasingly becoming a numbers game. In this context, the big boys will have to shell out significant funds to keep their machines rolling. The minnows should not be afraid, there will continue to be opportunity but they will have to develop other innovative means to get to the end client. They will have to think smart, get closer to their clients and be on the ground much more.