Financial services firms, insurers and healthcare payers admit they will need to add new capabilities to serve baby boomers, who will control some $40 trillion in retirement assets by 2020, a study shows.
Boomers face great doubts about how they will fund their retirement and how wealthy they will be during those years, according to the study by Diamond Management & Technology Consultants Inc., Chicago.
Boomers who fail to plan now will fall short of their expectations, Diamond says. But unless they consider new strategies now, companies planning to serve the boomer market run a similar risk of missed expectations, Diamond warns.
In its "Retirement Study 2008," Diamond reports that 89% of insurers believe that "making products simple for their customers to understand" is a source of competitive advantage, but only 23% believe they have effectively developed that capability.
Among financial advisors, 77% see speed-to-market in bringing new products and services to the boomer market as a source of competitive advantage, but only 20% say they now have that capability.
Among bank respondents, 89% viewed pricing as somewhat or very important to compete, but only 51% said that today they have the capability to use pricing for competitive advantage.
