With increased regulatory demands, new agile technologies, a generational shift in consumer behaviour and an unprecedented transfer of wealth beginning, what does a future advice business look like to become sustainable?
- The value of advice is and will remain a critical factor. If you cannot add value there will be questions about the sustainability.
- There is/will be an increased focus on technology in the next two years. Fintech market already very crowded.
- The economics of an organisation will play a big part.
Key issues and challenges:
- In an increasingly digital world the value of advice still needs to be demonstrated but how do you do so when clients perceive some of the job is being done by an app!
- The capital requirements to address the increasing demand/need for its solutions.
- The latest clients will require a hybrid of tech and client facing interaction.
- The market sees the likes of Amazon and Virgin entering the market. They are brands the clients already trust.
- Open Banking - friend or foe? Will depend on how the banks act on it. Will they risk their brand and clients’ trust?
Conclusions and solutions:
- A cultural change is required in firms to adapt. Advisers need to stop being so protective of their clients. A GP has no issue when referring their patients to the right expert for assessment and then recover the relationship for ongoing care. Advisers should be more open to doing what’s best for the client.
- Advisers need to be flexible and multi-tasking.
- Client’s trust is paramount. Most searched by clients on internet “Who is Nutmeg and can I trust them?”
- There will be a requirement to continue to justify on-going fees. Could the Australian financial concierge model work in the UK? Reducing the adviser time?
- Clients shouldn’t be presented with just the best option. They need to see all the work that has been done for them.
- It is all about consistency of service. No matter how you deal with them, be it face to face, robo or hybrid.
- The asset manager that relies on products for the next five years will struggle.
Experts: James Verner & Sophie Andrews - Legg Mason
Facilitator: Neil Baines-Thomas - Venture Development Solutions Ltd