- The demand for advice is still rising with assets under advice rising from £64bn to £521bn in just 10 years.
- The first contact for Robo Advice is, in the majority of cases, for Retirement Advice.
- The Robo models that have succeeded have done so by converting existing customers and not in attracting new customers.
- The hybrid models of Robo have been successful and therefore IFAs are ideally positioned should they introduce a digital solution to complement their existing business.
- Parts of the advice process lend themselves to being automated.
- Since 1900, automation has removed a huge number of basic human tasks.
- There is no truly digitalised solution in the UK.
- A ‘digitalised solution’ means different things to different people. The same can be said for the word ‘advice’.
- A digital experience needs to offer more than just a product.
- It is recognised that there would be a lower cost to providing a digital solution.
- Investment fund discussions are about high cost v low cost and no longer about active v passive.
- Behaviours are changing.
- Cost of implementation.
- How to deliver two types of service.
- The definition of a ‘Digital Solution’ and of ‘Advice’ is not consistent.
Conclusions and solutions:
- Automation should be encouraged, it will create efficiencies to improve profits, but also it will enable employees to do the tasks that they enjoy and really make a difference.
- Businesses should be indifferent to their advice offering as long as price and services are appropriately aligned.
- Many adviser firms have been implementing automation for years, particularly in the areas of investment reporting, rebalancing of portfolios, risk profiling, asset allocation, portfolio management, fund selection, and cashflow projections.
- Consideration should be given to providing a digital solution to compliment Advice. Care should be given to how this is introduced to clients.
- We may see the larger providers of Digital Solutions such as Vanguard providing white labelled versions to help strategic partners.
Expert: Roy Wilkinson and Georgina Yarwood, Vanguard