The Financial Revolution. Simplify Fintech

10 November 2022

Client ExperienceDigitalFintechHybridMindful OfroboWealthTech Matters

Expert: Andrew Storey (EV) Facilitator: Owen Frankish (EY)


  1. Digital advice is enhancing, not replacing, the financial adviser
  2. It can make advice more profitable and accessible
  3. The client experience can be improved through better online engagement


Digital Advice Models

This different types of digital and hybrid advice models that Fintechs can adopt:

  • Digital Guidance will only cover the fact-finding stage (e.g., a retirement planner where the client enters information)
  • Self-service digital advice / Robo-adviser (e.g., ISA renewals)
  • Assisted digital advice is where digital tools can find a solution but advisers action and discuss recommendations
  • Supported traditional advice – Advisers used tech to improve efficiency, digitising some of the process e.g., using online fact-finding portals
  • Full traditional advice is where the adviser does all stages themselves (fact finding, solutioning and recommendations)

Organisations are finding shifting client focus to digitisation:

A few years ago, robo-advice had less than 2% penetration in the UK market. From the group’s perspective, they felt the engagement piece needs to be not only digitally-led, but human.

The pandemic was a huge factor in accelerating the way people are now having meetings and a major positive for the industry is time efficiency.

Data can flow seamlessly within back ends and complement ongoing advice. Having the adviser married up with tech means the new clients are keen to embrace technology, whereas existing clients are used to traditional advice. There will be a migration of people moving away from this experience (lower net worth), shifting movement of how the client bank is looked at. For new clients, social media is driving people to firms’ websites, they want advice to be underpinned by a digital experience that is engaging.

Firms are not waiting for a regulatory-led approach. The FCA said they are going to look at simplified personalised guidance but don’t expect this any time soon. Regulation to make this work is 4-5 years off due to Parliamentary sign off / approvals. The hope is to deliver this as a complete solution rather than waiting for the regulations.

Challenges of digital implementation:

Participants are trialling the process of having their clients do their complete fact-finding themselves prior to adviser meetings. The challenge identified being the back-end systems integration and getting these tools in place. An adviser firm highlighted issues with the flow, from mapping back office into cashflow systems (not all information is recorded and translates into systems).

Firms are finding that both advisors and clients want different journeys:

Some advisers want prospective customers to fill in everything so their first meeting is in-depth, while other advisers want basic information as they feel an in-person or Teams conversation is better to pull all the information around a client’s wealth and where they want to go. Firms are facing challenges catering for all of these as well as changing client preferences.

Current digital guidance tools are complex, requiring clients to input vast amounts of information and need to have a more customer-focussed experience e.g., triage process.

Attracting clients to seek financial advice:

There is a gap in the advice market with large client demand but is too expensive to run for clients with less investable assets. Those with less assets are paying a higher percentage fee ongoing.

Some firms are saying clients are coming through different sources such as professional connection referrals (e.g., their doctor, lawyer), even when they are not looking for advice at that point such as around usual life stages. Now, firms are pitching to the client to start the journey before this.

As a result, advisers need to start with guidance across many people to provide insights on why they need help. Advisers are implementing self-serve where they can, but when clients need the help, they have the option to go through one of the other routes.

Firms should provide a value exchange of their advice during the fact-finding process.

Conversely, firms catering to exclusively ultra-high net worth individuals have found their clients do not pushback on information adviser’s request, since they have higher hourly adviser fees and a typical advice session is 5.5 – 13 hours

Main ways to increase adviser profitability:

  1. Charge more (limited appeal and high effort to create a value-added service)
  2. Reduce costs (lower overhead and reducing time)
  3. Reduce complexity (by using a restricted model, increasing staff training automating repetitive processes to increase advisor efficiency)

Challenges of a demographic advice gap:

Over 50% of advisers are over 50 or 55 and firms recognise there will be less advisers in the future, causing unfulfilled demand.

Over the next decade, the solution must be a shift to more digital / algorithmic driven advice. Winners are those that have a blend of human advice alongside digital advice tools tailored to customer needs

Improving the client experience through better online engagement:

Creating better online engagement can come by embedding personality through nudges to clients (reminders for life events, market announcements etc.), catering online content for personality types and continuous feedback. 

A tailored communication style is key to improve clients’ digital experience.

Firms discussed that adviser’s profitability comes from maintaining ongoing relationships which a tailored digital experience will help with. Customers stay with advisers until they are disrupted by something better.

Participants discussed a solution needs to be tailored to a customer’s communication / personality style, but there are challenges grouping clients into one of many boxes

A personality type may not fit a client after time. Firms highlighted a personality type driven by their objectives and goals can change over time as client’s children grow up, invest in university.

Participants mentioned robo-advisors like Nutmeg’s key challenge is the cost of attracting individuals onto their platforms. Yet, there will be parts of the process the adviser can step away from to help reduce cost of advice for customers and improve margins.

Knowing these platforms are there, as well as having an adviser accessible is key in order for clients to feel comfortable.

Firms discussed there may be certain touchpoints the adviser needs to be involved, where they can add value to the digital experience.

Client Experience is better through Financial Advisers than Banks:

Industry papers on the frontier of financial advice proposed a solution to the advice gap is in the banking industry. A client’s first port of call is having a discussion with their bank, but firms think financial advisers are in the driving seat as the access, face to face adviser discussions and quality of service are higher.

An advisory firm suggested banks have a lot of technology that does not work, whereas advisers can take advantage if they have the technology in the future.

Key takeaways:

  • Organisations are finding shifting client focus to digitisation which presents its own challenges
  • The traditional adviser-led only model is becoming replaced by customers wanting a blend of adviser time with digital experience
  • Firms are trialling new ways to improve profitability with rising technology costs
  • A tailored communication style is key to improve client’s digital experience