Mobile technologies, artificial intelligence, and predictive analytics at firms such as Amazon, Netflix, and Pandora anticipate customer needs and improve customers’ daily lives. These firms are setting new standards for personalized experiences, creating the expectation that any information, product, or service will be available in the context in their moment of need to manage their personal financial lives, as well.
Similarly, in the wealth management industry digital technologies are now at the core of how investors, advisors, and financial institutions operate. Retail investors are now benefiting from superior digital investing experiences provided by disruptors such as Ellevest, Personal Capital, and Wealthfront, which are being lauded for delivering innovation at a faster pace than incumbent wealth management firms.
An overlooked part of the investing value chain that is also being impacted by digital disruption is the financial advisor. Digital technologies are transforming how financial advisors do their jobs and the types of advice they provide to clients. Powered by these same technologies, fintech startups are threatening advisors’ role with automated financial advice, automated portfolio management, and lower fees. Because of digital technologies, changing customer behavior, and market dynamics, advisors are under pressure from many directions to serve their clients effectively.
Rising investor expectations and competitive pressures are the catalysts driving investment management firms to arm advisors with digital capabilities that enable them to drive more effective interactions with prospects and clients. Consider the following use cases of technologies that are changing the role of advisors:
Read more in my latest report on my view of the six interconnected technologies benefiting financial advisors and how they will eventually reshape the financial advice industry, creating new business and operating models for both financial advisors and investment management firms.
Vijay Raghavan, senior analyst, Forrester, authored this article, which can also be found here.
The views and opinions expressed in this article are those of the author and do not necessarily reflect those of CDOTrends.