Gamification has been a hot trend for some time now. As defined by Wikipedia, the term means “application of game-design elements and game principles in non-game contexts. Gamification commonly employs game design elements to improve user engagement, organizational productivity, flow, learning, crowdsourcing, employee recruitment and evaluation, ease of use, usefulness of systems, physical exercise, traffic violations, voter apathy, and more”. All that and throw in the kitchen sink, too. Seriously though, its is an important business trend and one that is worth bearing review for wealth managers, too – particularly with their younger millennial clients. Remember the term wealthcraft, because you may be seeing more of it in the future, and contact us and tell us how you incorporate gamification in your wealth management practice.
“Wealth managers are both trying to manage the fortunes of millennial gamers and incorporating gaming elements into their own offerings
The mahogany-walled meeting rooms of private banks may not seem at first like a natural environment for video games. However, the worlds of private banking and gaming are becoming increasingly intertwined as wealth managers target rich millennials and their new-found fortunes. Last month, Coutts made headlines with the announcement that it is seeking to attract a new client segment of professional e-gamers for the first time in its 325-year history. In fact, Goldman Sachs estimates that the e-sports industry will be worth more than $1bn by the end of this decade.
As well as trying to manage the fortunes of millennial gamers, wealth managers have progressively been co-opting gaming principles, or gamification, into their offerings to create better client experiences.
Gamification refers to the concept of incorporating elements of games into non-gaming applications to encourage customer participation. Although many people would not identify themselves as ‘gamers’, we regularly encounter gamification techniques such as levelling up on airline loyalty schemes or going that extra mile to beat your Fitibit friend’s step count.
While the wealth management industry has lagged behind the digital curve, there are several applications for gamification to help educate millennial and first-time clients. Most firms have embedded the concept of goal-based investing although younger clients commonly underestimate how much they need to save for retirement. Furthermore, recent studies have shown that many millennials believe they have insufficient knowledge of investments and possess a more risk-averse attitude than older age groups. Relatability is also an issue where the average age of a financial adviser is around 55 and there continues to be more advisers are over the age of 70 than under 30.
7IM’s app, My Future, was developed with the help of Nintendo gaming experts to engage younger investors and help them understand the benefits of financial planning. A gaming-style tool shows users what income they can expect in retirement and when their money might expect to run out under different scenarios. It can present a stark picture of a poor retirement for clients although this then serves as a prompt for advisers to discuss how to solve some potentially difficult problems…”