Digitally Native Consumers a Significant Opportunity for Advisors

With younger generations of more digitally native consumers taking a bigger slice of the global disposable income pie, the economy is poised to undergo a substantial change. And while most financial advisors believe it’s worth investing in funds that target the consumer habits of Generations Y and Z, few are adequately exposed to such strategies in their portfolios.

In a post-viewer poll following the VettaFi webcast, What Advisors Need to Know About the Connected Consumer, 88% of the respondents agreed that a data-driven strategy focused on the Gen Y and Z cohort represents a significant opportunity, with 36% strongly agreeing. And yet, only 9% said they were “very exposed” to the growth opportunities of early-stage consumer trends, while 61% are only “somewhat exposed.” Meanwhile, 30% of respondents said they have no exposure to investment strategies that focus on such opportunities.

In the webcast, Neuberger Bergman and VettaFi discussed the consumer power of Generations Y and Z and how the Neuberger Berman Connected Consumer ETF (NYSE Arca: NBCC) uses data science to identify and tap into future consumer trends primed for mass adoption. The actively managed NBCC targets companies that demonstrate significant growth potential from connectivity-based consumerism. The fund spans a broad range of industries globally and may invest in companies of any market cap.

NBCC is managed by Kevin McCarthy, John San Marco, Kai Cui, Timothy Creedon, and Hari Ramanan. The team will evaluate the web search and spending tendencies of millions of consumers and the daily call transcripts and filings of over 4,000 public companies to identify the best opportunities for mass adoption in the digital age.

“Retailers need to reimagine their technology or business model to connect with the Gen Y and Gen Z consumers,” said John Aguilar, senior vice president and head of U.S. intermediary marketing at Neuberger Berman. “How are companies reimagining themselves to future-proof their business to connect with that digitally native cohort?”

The poll also revealed that most respondents (70%) are either somewhat (44%) or very likely (26%) to consider adding thematic strategies to their clients’ portfolios, with 68% saying they plan to add to or initiate a position to the NBCC in the next six months.

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