crypto strategy

“We will never be Coinbase”: how Pictet WM attracts the next generation of customers

At a time when many wealth managers are downsizing their local workforce, Pictet sees on-the-ground presence as key to getting closer to clients.

This strategy becomes evident when you enter the company’s offices in Zurich, located in the Leuenhof, a 105-year-old bank building, which the Geneva bank lovingly renovated a few years ago.

The carefully placed wooden panels and artwork all send the message: we’re here to stay and we intend to leave a mark.

Victor Aerni, head of the group’s wealth management in Zurich, said that while customers need digital support, it’s equally important for them to know how highly rated the bank is, who runs it and who is the CEO of the local branch.

“In Germany, we compete with, among others, Deutsche Bank and offer wealth management from Germany rather than Switzerland. If you’re not there, you’re often seen as the second choice.

The wealth manager provides digital solutions, such as Pictet Connect, which allows users to slice and dice their account information in different ways, but it does not target clients who want to do it all themselves.

More than 14 years ago, while working for Boston Consulting Group, Aerni examined the needs of different client groups and their level of involvement in the wealth management process.

He admits Pictet is great for delegators but probably not the bank of choice for someone who wants to do it all themselves.

“We will never be Coinbase, we are Pictet, and if someone wants to trade all day online, you can go to an online broker for that,” he said.

Focus on organic growth

Aerni said the bank continues to grow organically and will continue to hire next year, both in private banking and support functions.

According to the firm’s 2021 annual report, the number of bankers in its wealth management division fell year-on-year from 363 to 355, which is likely linked to the departure of managing partner Boris Collardi. . However, this decline contradicts the growth that preceded it.

The bank has not made any acquisitions in its 217-year history, whether in wealth or asset management.

“It’s a sign that we have a distinct culture, where we want to grow step by step with the right values, rather than to grow,” Aerni said.

Pictet has 220 employees in the Zurich office alone, where it moved 18 months ago, but there is room for 300. Rather than targeting specific geographies, the wealth management team will continue to focus on hiring talented people when opportunities arise.

“We are a private company so needless to say we plan to add 80 people over the next 12 months. If we find the right match and the right talent, we’ll get more people into this building faster.

Aerni said times of uncertainty are the best times for the company to hire because that’s when the right people sometimes don’t get the right support or don’t see the strategy behind hiring or opportunistic dismissal.

Nor is he in a rush to go after corporate bankers who are going through tough times, be it Credit Suisse or any other peer in the market.

“It’s not like we’re saying, ‘Okay, this bank is in trouble now, let’s get the best people there. It’s not our way of doing business.

Promote from within

Besides hiring teams from outside the organization, one of the latest improvements for the group has been better internal mobility.

A good example is head of fund selection Mussie Kidane, who is now the CIO of the firm’s North American Advisors unit. Aerni works closely with Kidane and the team whenever third party funds are required for client portfolios.

‘Perhaps in the past you would have said, “I don’t see my next opportunity within the bank and I have to go to a competitor.” With my hat as a former consultant, I think it’s good to have better internal mobility.’

Another change of course for the group, which now exceeds 5,000 total staff, in search of younger and less experienced recruits.

“There aren’t a lot of experienced people to hire, and everyone fights for the few people available at any given time. This is why we are hiring more and more young people.

It also helps build a bridge with millennial clients, often misunderstood by traditional wealth managers.

Aerni said the younger generation of bankers are more likely to highlight the group’s research on crypto assets in front of millennial clients for example.

“Perhaps some senior bankers would put it aside, while younger ones would suggest reading it. It all starts with knowing the topics of interest to the younger generation.

Serving Generation Y

However, Pictet is wary of the millennial generalization and realizes that in a family you can have two siblings a year apart with opposing views on digital assets.

For many younger clients, the “passion project” is to launch their next business, rather than be their own private banker for the next 50 years.

“They are digital natives and they like business models based on these principles. But they also make money as entrepreneurs, which doesn’t mean they want to do private banking themselves.

“It would be wrong to say that millennials are equal to crypto. I think they’re much more interested in new business models, like blockchain, and thinking about what they can do to disrupt the world, whether it’s biotech or developing a new app,” said Aerni.

Whether it’s traditional or next-generation customers, Aerni believes that Pictet can offer something that its peers rarely can.

The business is a private partnership whose owners are still very involved in its day-to-day running, which was an attraction when he joined all those years ago.

“Pictet is a partnership of entrepreneurs active within the company. They don’t stay in Saint-Tropez all year round and only watch us occasionally, they work alongside us and with their own clients.

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