Recent times have seen a number of senior executives from the luxury goods industry take a dive into the world of Swiss private banks. But what does banking have in common with designer bags, private jets, and high-fashion? What knowledge do those from the luxury goods industry have, that generations of private bankers have been unable to gain?
When a high net-worth client selects a bank to manage his finances, the decision is based on the banks reputation, history, and quality of service; exactly the same intangibles sold by a high-end luxury brand. While Swiss banks have been dealing with the wealthy for centuries, they still have a lot to learn about service. Many clients are disappointed by the almost rude behavior of the banks when it comes to quickly cleaning up finances.
Executives from the luxury goods industry have been able to develop skills that are highly in-sync with the requirements of Swiss banking today. These executives know how to create a highly desirable and exclusive product that the wealthy would lust after; combined with impeccable service and flawless delivery, across multiple touch-points.
A wealthy client, experiencing luxury wherever he goes, will not compare the service received at his Swiss bank to that received at another bank. He will compare it to the service he receives at other luxury service providers; the spa, the restaurant, the resort. While Swiss banks may be far ahead in service versus other banks, they are still behind the luxury industry; which is the true industry they are competing in.
Service can mark the difference between a nightmare and a dream come true. It enables a disastrous situation to become a memorable one. You go to a high-end luxury restaurant for example, and do not like the taste of what you ordered. Does the waiter acknowledge your concern? Does he offer to replace the dish for you, bring you a complementary dessert, or take your concerns to the chef? Or does he brush you off; because of course, you received what you ordered. This difference in service is what makes the distinction between a truly luxury experience and an ordinary one; and applies as much to banks as to any other luxury good or service.
The key to remember is that when a wealthy client selects a bank, what he is really purchasing is a service; a personal relationship with highly skilled individuals whom he trusts with his lifetime of earnings and hard work. He is looking for a private banker who goes the extra mile to listen to him, make him feel special, and ensure he is getting exactly what he needs. In fact, this relationship is what ensures that clients don’t leave just because the bank’s performance has dropped by a percentage point in a given year.
Service doesn’t start and stop at the relationship manager however. It covers every touch-point with the consumer, beginning right from the entrance, and continuing across the greeter, the quality of coffee served, and the ambiance. Swiss banks are only beginning to learn that luxury must cover all areas of the client’s experience; something the luxury goods industry knows extremely well.
However, is hiring top executives from the luxury goods industry enough for this transformation? True transformation comes from within, when management from the top believes in the cause and transfers this belief down to the lowest levels. Whether Swiss banks can achieve this, is something only time will tell.