Time is running out for global asset managers to start preparing for the coming millennial generation.
Asset managers who are not already preparing for the day when the millennial generation takes over the investment reins from the Baby Boomers will be at a distinct disadvantage, it may already be too late for some.
Global research and consulting form Cerulli Associates says that the values, priorities, and expectations of millennials, currently aged 20 to 35, differ from those of their Baby Boomer parents, currently aged 51 to 69.
Trillions of Dollars
While Cerulli believes that the older generation will be in the investment driving seat for at least another ten years, it warns that managers that have not started factoring in these differences risk disappearing from the radar of the millennials completely.
The millennial generation may not be driving returns right now but it will be worth an estimated $19-24 trillion by 2020.
Comfortable Online
Research by Cerulli's Singapore office shows that 75 percent of millennials conduct at least 20 percent of their engagement with their wealth managers through digital mediums, compared to 54 percent for Baby Boomers.
In five years, the proportions are projected to have risen to 95 percent and 73 percent respectively.
Millennial Integration
«Asset managers need to gain a deeper understanding of the broad communication mindset of a Millennial--how they prefer to interact with companies, not just within finance, but across a range of industries,» said Barbara Wall, Europe managing director at Cerulli.
An obvious solution is of course for asset managers to hire more millennial employees into decision-making posts while also making greater use of data mining and artificial intelligence to gain an insight into what makes this generation tick.
