Another February, another ITAS and the Luxembourg sun was shining on the fund management industry. Unlike many previous years, there were some clear statements on how our industry is likely to revolutionise: not brought by regulation alone, but because of fundamental changes in the way that the end investor behaves and their expectations from those they interact with.
The social media generation is coming of age (and they are influencing those of us who have not grown up with Facebook) and new players will soon be entering our market – players who do not think or act like we do. Players who put attracting clients first, not figuring out how to make a profit from a particular product; players who put knowing their client and what that client thinks above telling them what to make of fund performance data reaching back to the previous century.
We heard again and again how many people have been seized by the data zeitgeist –without understanding either what ‘big data’ actually is, or appreciating the (lack of) real value of their own data whilst in isolation.
Some of the panel sessions that followed the keynote speech (Phil Goffin, IFDS) clearly understood the points that he was making; others continued to concentrate on the minutiae regardless of the fundamental shifts going on around them. For the last 10-15 years fund managers have not had to think about the end consumer, yet some panelists were starting to discuss how this is changing, and changing fast. The impact this will have on platforms and TAs will be profound: and both will have to adjust to the parameters set by the expectations of the Facebook generation. The question is whether the fund managers are able to move quickly enough to ensure client loyalty when the new players crash into their markets.
What is very obvious to us at Calastone, and addressed within our article “The investor of the future” (published in Asset Servicing Times, Conference Special), is that the industry is moving far too slowly today to put up a credible and real challenge against Big Tech – those that regard client engagement and behavioral analysis as USPs rather than a compliance exercises.
It was also clear that there is far greater appetite from all industry participants to work together and solve challenges than in any other previous years, whether it is with regard to data consolidation or to take the front foot with dealing with regulation in a much more proactive way. We will look to help drive this collaboration forward. All food for thought…
Talking of great food and drink, thank you to those who attended the Calastone dinner, we had a great night! Thank you to those who hosted us at their various events on the following night, your hospitality was much appreciated and we look forward to catching up again at ITAS Dublin in September and ITAS Hong Kong in November.