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Description

Description

“For banks targeting the affluent market offering a holistic approach can be important strategy and the focus should not just be around premier accounts. Firms can target new customers by offering to provide and manage a suite of accounts in order to cater for clients’ particular financial situations and needs. ”

– Stevan Obradovic, Financial Services Analyst

Some questions answered in this report include:

  • Can firms target clients with multiple accounts?
  • Will the new switching service encourage more people to change their account provider?
  • What are the main influencing factors when affluent consumers choose accounts?
  • Why do consumers overlook paid for, premium or full private accounts?

What's included

What's included

Table of contents

Table of contents

  1. Introduction

      • Report scope and definitions
        • Abbreviations
          • Key sources
          • Executive Summary

              • The market
                • Identifying the Aspirational, Mass Affluent and Affluent & HNW market
                  • Figure 1: Proportional breakdown of UK wealth, based on ownership of investable assets (excluding housing equity), 2013
                • Market factors
                  • Switching service presents an opportunity for banks
                    • Impact of the RDR
                      • Companies, brands and innovation
                        • Main banking brands also exert their dominance in the affluent segment
                          • Figure 2: Main current account provider, by segmentation of the wealth market, August 2013
                        • Adspend on banking products and services up by a fifth in 2012/13
                          • Who’s innovating?
                            • The consumer
                              • Segmentation of the Aspirational, Mass Affluent and Affluent & HNW markets
                                • Figure 3: Segmentation of the wealth target market, by value of investable assets, August 2013
                              • Current account ownership
                                • Figure 4: Current account ownership, August 2013
                              • Current account provider
                                • Influential factors for choosing an account
                                  • Figure 5: Influential factors when choosing an account, August 2013
                                • Reasons for overlooking a fee charging account
                                  • Figure 6: Reasons for not taking out a fee charging account, August 2013
                                • Current account switching
                                  • Figure 7: Account switching behaviour, August 2013
                                • Intentions of using the current account switching service
                                  • Figure 8: Current account switching intentions, August 2013
                                • What we think
                                • Issues in the Market

                                    • Can firms target clients with multiple accounts?
                                      • Will the new switching service encourage more people to change their account provider?
                                        • What are the main influencing factors when affluent consumers choose accounts?
                                          • Why do consumers overlook paid for, premium or full private accounts?
                                          • Trend Application

                                            • Bringing your bank to you
                                              • Try before you buy
                                                • Mintel futures: Generation Next
                                                • Market Drivers

                                                  • Key points
                                                    • Many potential investors remain wary of taking on too much risk
                                                      • Switching service presents an opportunity for banks
                                                        • FSA cuts income limit for advice opt-out
                                                          • The FCA is looking to put in more stringent rules about ring-fencing client funds
                                                            • Shake-up in the retail banking scene
                                                              • Impact of the RDR
                                                                • MIFID II update
                                                                • SWOT Analysis

                                                                    • Figure 9: Premium and mass affluent banking – SWOT analysis, 2013
                                                                • Who’s Innovating?

                                                                  • Key points
                                                                    • Barclays launches a financial planning tool
                                                                      • Citi Private Bank signs a new sponsorship agreement
                                                                        • Roundup of some of the more exclusive private bank services
                                                                        • Market Size

                                                                          • Key points
                                                                            • Around 16% of over 18s fall into the target wealth market
                                                                              • Figure 10: Proportional breakdown of UK wealth, based on ownership of investable assets (excluding housing equity), 2013
                                                                            • HNW clients most likely to have accumulated wealth through employment
                                                                              • Figure 11: HNW wealth accumulation, June 2012
                                                                            • Age has an impact on wealth accumulation
                                                                              • Figure 12: HNW wealth accumulation, by age, June 2012
                                                                            • Affluent & HNW clients most likely to have private bank accounts
                                                                              • Figure 13: Current account ownership, by segmentation of the wealth target market, August 2013
                                                                          • Market Share

                                                                            • Key points
                                                                              • Main banking brands also exert their dominance in the affluent segment
                                                                                • Figure 14: Main current account provider, by segmentation of the wealth market, August 2013
                                                                              • Coutts and Barclays lead the way when it comes to AUM
                                                                                • Figure 15: Largest 15 wealth managers, by assets under management and number of client accounts – UK, 2011 and 2012
                                                                            • Companies and Products

                                                                              • Barclays
                                                                                • Description
                                                                                  • Branch network
                                                                                    • Mass retail proposition
                                                                                      • Premium proposition for the mass affluent
                                                                                        • Figure 16: Barclays premium current account – key features, August 2013
                                                                                      • Private banking for HNW
                                                                                        • Financial performance
                                                                                          • Figure 17: Barclays UK Retail and Business Banking Division – key financial data, 2011 and 2012
                                                                                          • Figure 18: Barclays Wealth – key financial data, 2011 and 2012
                                                                                        • Recent activity
                                                                                          • Citibank
                                                                                            • Description
                                                                                              • Branch network
                                                                                                • Premium proposition for the mass affluent
                                                                                                  • Figure 19: Citibank’s Citigold current account – key features, August 2013
                                                                                                • Private banking for HNW
                                                                                                  • Financial performance
                                                                                                    • Figure 20: Citicorp’s Global Consumer Banking division, EMEA region – key financial data, 2011 and 2012
                                                                                                  • Recent activity
                                                                                                    • Clydesdale Bank
                                                                                                      • Description
                                                                                                        • Branch network
                                                                                                          • Mass retail proposition
                                                                                                            • Premium proposition for the mass affluent
                                                                                                              • Figure 21: Clydesdale Bank’s premium account – key features, August 2013
                                                                                                            • Financial performance
                                                                                                              • Figure 22: Clydesdale bank Plc – key financial data, 2011 and 2012
                                                                                                            • Recent activity
                                                                                                              • HSBC
                                                                                                                • Description
                                                                                                                  • Branch network
                                                                                                                    • Mass retail proposition
                                                                                                                      • Premium proposition for the mass affluent
                                                                                                                        • Figure 23: HSBC Premium account – key features, August 2013
                                                                                                                      • Private banking services for HNW
                                                                                                                        • Financial performance
                                                                                                                          • Figure 24: HSBC Bank Plc’s UK Retail Banking and Wealth management division – key financial data, 2011 and 2012
                                                                                                                        • Recent activity
                                                                                                                          • Lloyds TSB
                                                                                                                            • Description
                                                                                                                              • Branch network
                                                                                                                                • Mass retail proposition
                                                                                                                                  • Premium proposition for the affluent
                                                                                                                                    • Figure 25: Lloyds TSB’s premium/private bank account – key features, August 2013
                                                                                                                                  • Private banking for HNW
                                                                                                                                    • Bank of Scotland’s private banking
                                                                                                                                      • Financial performance
                                                                                                                                        • Figure 26: LBG’s Wealth and International division – key financial data, 2011 and 2012
                                                                                                                                      • Recent activity
                                                                                                                                        • NatWest/RBS
                                                                                                                                          • Description
                                                                                                                                            • Branch network
                                                                                                                                              • Mass retail proposition
                                                                                                                                                • Premium proposition for mass affluent
                                                                                                                                                  • Figure 27: RBS/NatWest premium/private bank account – key features, August 2013
                                                                                                                                                • Private banking for HNW
                                                                                                                                                  • Financial performance
                                                                                                                                                    • Figure 28: RBS Group’s Wealth division – key financial data, 2011 and 2012
                                                                                                                                                  • Recent activity
                                                                                                                                                  • Brand Communication and Promotion

                                                                                                                                                    • Key points
                                                                                                                                                      • Adspend on banking products and services up by a fifth in 2012/13
                                                                                                                                                        • Figure 29: Total advertising expenditure on banking and asset management products and services, by product category, 2008/099-12/13
                                                                                                                                                      • Barclays continues to lead the way in advertising expenditure
                                                                                                                                                        • Figure 30: Top five advertisers of packaged/premium accounts and mass-market wealth management services, 2010/11-12/13
                                                                                                                                                      • Press and internet advertising dominate the packaged and premium account market
                                                                                                                                                        • Figure 31: Share of advertising expenditure on packaged/premium accounts, by media type, 2008/099-12/13*
                                                                                                                                                      • A note about adspend
                                                                                                                                                      • Channels to Market

                                                                                                                                                        • Key points
                                                                                                                                                          • Having an accessible branch network is important
                                                                                                                                                            • Figure 32: Number of branches operated, by the top six retail banking groups, start 2013
                                                                                                                                                          • Online banking leading the way in client interaction
                                                                                                                                                            • Figure 33: Frequency of using banking services provided by main current account provider, June 2013
                                                                                                                                                        • Profile Analysis of the Wealth Target Market

                                                                                                                                                          • Key points
                                                                                                                                                            • Survey coverage
                                                                                                                                                              • Wealth tiers among affluent consumers
                                                                                                                                                                • Figure 34: Segmentation of the wealth target market, by value of investable assets, August 2013
                                                                                                                                                              • Older male clients well represented in the target wealth market
                                                                                                                                                                • Figure 35: Profile of wealth target market based on wealth tier, by gender and age, August 2013
                                                                                                                                                              • Investable assets can be more important than income for private banks
                                                                                                                                                                • Figure 36: Profile of wealth target market based on wealth tier, by working status, August 2013
                                                                                                                                                              • Engaging with the future generation of Affluent & HNW consumers
                                                                                                                                                                • Figure 37: Profile of wealth target market based on wealth tier, by child age, August 2013
                                                                                                                                                            • Current Account Ownership

                                                                                                                                                              • Key points
                                                                                                                                                                • A fifth of the target wealth market have a premier or fully private account
                                                                                                                                                                  • Figure 38: Current account ownership, August 2013
                                                                                                                                                                • Affluent & HNW clients most likely to have private bank accounts
                                                                                                                                                                  • Figure 39: Current account ownership, by segmentation of the wealth target market, August 2013
                                                                                                                                                                • A third of 18-44-year-olds have a premier or full private bank account
                                                                                                                                                                  • Figure 40: Current account ownership, by age, August 2013
                                                                                                                                                              • Current Account Provider

                                                                                                                                                                • Key points
                                                                                                                                                                  • Main retail banks lead the way even in the target wealth market
                                                                                                                                                                    • Figure 41: Main current account provider, August 2013
                                                                                                                                                                  • Lloyds TSB slightly more popular among Aspirational clients
                                                                                                                                                                    • Figure 42: Main current account provider, by segmentation of the wealth market, August 2013
                                                                                                                                                                • Influential Factors for Choosing an Account

                                                                                                                                                                  • Key points
                                                                                                                                                                    • Easy to use online banking tools most influential when picking an account
                                                                                                                                                                      • Figure 43: Influential factors when choosing an account, August 2013
                                                                                                                                                                    • Premier and full private account holders more likely to place importance on value-added services
                                                                                                                                                                      • Figure 44: Influential factors when choosing an account, by Current account ownership, August 2013
                                                                                                                                                                    • LBG and RBS Group clients more likely to value an accessible branch
                                                                                                                                                                      • Figure 45: Influential factors when choosing an account, by main current account provider, August 2013
                                                                                                                                                                  • Reasons for Overlooking a Fee Charging Account

                                                                                                                                                                    • Key points
                                                                                                                                                                      • Even many affluent consumers are not willing to pay for current accounts
                                                                                                                                                                        • Figure 46: Reasons for not taking out a fee charging account, August 2013
                                                                                                                                                                      • Around 11% of the target wealth market have never looked at paid for accounts
                                                                                                                                                                        • LBG clients more likely to have reverted to a regular current account
                                                                                                                                                                          • Figure 47: Reasons for not taking out a fee charging account, by current account provider, August 2013
                                                                                                                                                                        • Little disparity in barriers among the three wealth tiers
                                                                                                                                                                          • Figure 48: Reasons for not taking out a fee charging account, by segmentation of the wealth market, August 2013
                                                                                                                                                                      • Current Account Switching

                                                                                                                                                                        • Key points
                                                                                                                                                                          • Two thirds of affluent consumers have switched their current account
                                                                                                                                                                            • Figure 49: Account switching behaviour, August 2013
                                                                                                                                                                          • Over-65s least likely to have switched current accounts before
                                                                                                                                                                            • Figure 50: Account switching behaviour, by age, August 2013
                                                                                                                                                                          • Regular current account users less likely to have switched recently
                                                                                                                                                                            • Figure 51: Account switching behaviour, by current account ownership, August 2013
                                                                                                                                                                            • Figure 52: Account switching behaviour, by segmentation of the wealth target market, August 2013
                                                                                                                                                                        • Intentions of Using the Current Account Switching Service

                                                                                                                                                                          • Key points
                                                                                                                                                                            • Hopes that switching service will boost current account competition
                                                                                                                                                                              • Figure 53: Current account switching intentions, August 2013
                                                                                                                                                                            • Previous account switchers more likely to make use of the new service
                                                                                                                                                                              • Figure 54: Current account switching intentions, by account switching behaviour, August 2013
                                                                                                                                                                            • Private/premier account holders more likely to plan on switching
                                                                                                                                                                              • Figure 55: Current account switching intentions, by current account ownership, August 2013
                                                                                                                                                                          • Appendix – Profile Analysis of the Wealth Target Market

                                                                                                                                                                              • Figure 56: Segmentation of the wealth target market, by demographics, August 2013
                                                                                                                                                                          • Appendix – Current Account Ownership

                                                                                                                                                                              • Figure 57: Current account ownership, by demographics, August 2013
                                                                                                                                                                              • Figure 58: Ownership of private/premier and full private bank accounts, August 2013
                                                                                                                                                                          • Appendix – Current Account Provider

                                                                                                                                                                              • Figure 59: Main current account provider, by demographics, August 2013
                                                                                                                                                                              • Figure 60: Main current account provider continued, by demographics, August 2013
                                                                                                                                                                          • Appendix – Influential Factors for Choosing an Account

                                                                                                                                                                              • Figure 61: Most influential factors when choosing an account, by demographics, August 2013
                                                                                                                                                                              • Figure 62: Influential factors when choosing an account, by demographics, August 2013
                                                                                                                                                                              • Figure 63: Least influential factors when choosing an account, by demographics, August 2013
                                                                                                                                                                          • Appendix – Reasons for Overlook a Fee Charging Account

                                                                                                                                                                              • Figure 64: Main reasons for not taking out a fee charging account, by demographics, August 2013
                                                                                                                                                                              • Figure 65: Other reasons for not taking out a fee charging account, by demographics, August 2013
                                                                                                                                                                          • Appendix – Current Account Switching

                                                                                                                                                                              • Figure 66: Account switching behaviour, by demographics, August 2013
                                                                                                                                                                              • Figure 67: Switching and non-switching behaviour, by demographics, August 2013
                                                                                                                                                                          • Appendix – Intentions of Using the Current Account Switching Service

                                                                                                                                                                              • Figure 68: Current account switching intentions, by demographics, August 2013

                                                                                                                                                                          About the report

                                                                                                                                                                          This report will give you a complete 360-degree view of your market. Not only is it rooted in robust proprietary and high-quality third-party data, but our industry experts put that data into context and you’ll quickly understand:

                                                                                                                                                                          • The Consumer

                                                                                                                                                                            What They Want. Why They Want It.

                                                                                                                                                                          • The Competitors

                                                                                                                                                                            Who’s Winning. How To Stay Ahead.

                                                                                                                                                                          • The Market

                                                                                                                                                                            Size, Segments, Shares And Forecasts: How It All Adds Up.

                                                                                                                                                                          • The Innovations

                                                                                                                                                                            New Ideas. New Products. New Potential.

                                                                                                                                                                          • The Opportunities

                                                                                                                                                                            Where The White Space Is. How To Make It Yours.

                                                                                                                                                                          • The Trends

                                                                                                                                                                            What’s Shaping Demand – Today And Tomorrow.

                                                                                                                                                                          Please Note: This is a sample report. All of the figures, graphs, and tables have been redacted.

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