Perspectives

Women investors

A critical and growing factor for success in the wealth management industry

​The shifting landscape of the wealth management sector has moved industry participants to refocus business strategies. Simultaneously, women have emerged as interested, committed, and knowledgeable investors. The spending power of women and the amount of wealth they control has grown significantly. Today, women represent a meaningful investor segment and capturing this segment is a massive opportunity for wealth management firms. However, to capture the segment, firms not only need to develop specific capabilities, but also the focus to meet the needs of the female investor.

What women want

To successfully capture this market segment, wealth management firms should strive to serve the nuanced needs of the woman investor. While marketing campaigns tailored toward women are useful, firms should develop more comprehensive services for women. Education is a critical service offering, as women are quite interested in knowing what investments are being made and why. Women want to learn from their advisor; firms should recognize this and work to provide this offering.

Firms should also aim to provide the desired investor experience. Women want to feel valued by wealth management firms. Value-add face time from advisors can increase a woman's confidence in and comfort with an advisor. Investing time to develop relationships with investors can help wealth management firms demonstrate the value they attribute to this market segment, while also improving revenues.

Additionally, firms should cater to investment preferences of women. Research indicates women, unlike men, tend to be more interested in investing and/or motivated to invest in companies to which they assign meaning and purpose. They typically view investments more personally and have a greater attachment to where they choose to direct their money. Women are also more inclined to invest in companies with diversity in leadership. They may gravitate and prioritize, to a greater degree than men, to using their investments/investment opportunities to make a positive impact on society. Financial advisors should recognize and respect these preferences as they try to serve female investors.​

​If wealth management firms recognize the power of women investors—namely, that they are an untapped market managing an increasing amount of wealth—they may significantly improve revenue.

A viable and valuable potential market segment

By providing a client experience, manifesting an inclusive culture, and offering a cohort of advisors who can meet the needs of women investors, wealth management firms can capture this market segment. Facing declining profits, expanding into this market is all the more critical. Although tapping into the segment of women investors may require strategic changes, firms should recognize women are an influential force in wealth management who are here to stay.

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