Social networks are all the rage, but there is a degree of scepticism about their application to the private wealth industry, particularly around security. Lombard Odier’s Olivier Collombin is a social network evangelist, and his experience with the bank’s E-MERGING platform is pushing him to organise the first ever 3D virtual financial forum.
Technology is forcing a change in every aspect of the wealth management industry, especially as the needs of the younger generation of clients and professionals are increasing exponentially. In the same way, the products that private banks and wealth advisors offer must also be adapted to fit every professional community.
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Following these changing needs, Swiss bank Lombard Odier created its B2B social network, E-MERGING, in 2009 to help experts in wealth management connect with each other anywhere from independent portfolio managers and family offices to IT solution providers.
With around 884 members in 42 countries with 9,070 employees, E-MERGING is pursing its international goal of connecting independent financial experts. Its members currently manage around $288bn by creating a unique platform of services sharing. Social networks are in fashion, yet many banks and wealth managers have been wary about its adoption. Not so Olivier Collombin, head of the independent asset managers department for Lombard Odier and head of E-MERGING – the Swiss bank’s B2B social network dedicated to independent financial experts.
"We wanted to create an online tool that would enable professionals to learn more about other companies’ strategies. We had to come up with a solution, an online solution," he explains.
"The idea is that somewhere there is a professional who has the expertise that you need. We don’t know where to get it and there are many other areas where the situation is exactly the same. You have very good professionals around the planet, but they are not well connected."
"So we considered that it was useful for the community of professionals to have a place where they could network together with their own professionals in their own profession, but also horizontally with other professionals".
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By GlobalDataCollombin said the benefit to Lombard Odier is directly measureable in referrals. In 2012, 25% of the growth in the external asset managers business (EAM) at Lombard Odier was due to the E-MERGING platform.
"That’s purely because the external asset managers used Lombard Odier to carry out the functions for whatever the new client has asked them to do", he adds.
Since the beginning of this year, there have been more than 2,000 internal messages to the platform, with more and more people wanting to test it.
"[With E-MERGING] there is a way we can get in contact with professionals we would not be able to reach with traditional means".
Changing the rules
E-MERGING has been created to open new doors in the traditional business of serving independent portfolio managers. The offering has evolved from its initial concept.
It began with a B2B "speed- merging day" at the beginning of the 2000s, where managers were invited to meet other professionals in private brief sessions,
Collombin and his group decided to turn those successful meetings into an online information provider, just in the same period the giant Facebook was taking over.
"We just decided to use the Facebook concept and give it to this financial community. At that stage, the major objective was to find potential partners and potential alliances through the search engine for the portfolio managers’ professional community".
"On the platform now we have 80 partners, independent professionals who do pay CHF5,000 a year to become partners. They can assist at our events, have access to the search engine and promote their service on the platform".
The E-store tool
The new E-MERGING tool is the E-Store, which was added earlier this year. It is a place where members can download applications that are useful for their activity. The apps offer online, due diligence name-checks and cross-border regulation manuals.
Collombin explains: "The idea is to promote some type of services that already exist among the partners, but that they were not able to sell to this community of fragmented players".
"Now we have a list of partners waiting for their application to be put on the E-Store, we have started with an e-learning tool for the cross border rules. We do have cross border country manuals, and then we will introduce new tools depending on what is offered by partners if we consider that business is useful for the community."
Security and confidentiality
Many professionals remained reluctant to E-MERGING initially. Social networking is relatively new in the wealth management industry, and many people are still developing their capabilities with the medium for their business.
"What is very difficult is to convince, lets say, traditional or in some way, conservative professionals to come in to social networks considering that all the data can be misused by the promoters of the network".
Collombin specifies that professionals who join E-MERGING own personal information and are free to get out of the networks without any risks.
"We won’t keep anything from you. The major advantage is you can go into the market without disclosing your intentions and name. It’s your decision to disclose your name or not. You can go further enough to create a shortlist of potential partners before you disclose your name".
The 3D virtual financial forum
In an attempt to extend its social network and expand its possibilities, Collombin is also organising the Virtual FinFair, the first 3D virtual financial forum that will take place in October this year.
"Each member [of E-MERGING] will be able to send each avatar to the forum at a specific time. Avatars will be able to sit to look at the presentation, and then also ask questions out of their PCs".
Partners can also buy their own booth, a virtual stand made to offer different financial services as well as giving presentations.
"We really want to have a chance once a year to have a moment where we can have everybody in the same place at the same moment", he says.
Targeting its younger members is the ultimate goal of this project as the new generations are more technologically-oriented and reliant on online tools.
"We have to open minds to other types of technologies and other means. I do believe that we can if we use the right tools, we still can be very serious in the way we do things, in the way we serve professionals and clients by introducing some fantasy in this forum. Maybe it is too big, maybe the last place where this type would be used, but I would like to be the first to do that," Collombin concludes
