Impact of Robo Financial Advice Apps on CX

Wealth management firms have long been prosperous because of the trust they have built through with customers/clients. That trust is rooted in their ability to work through the ups and downs of the market.

According to the COO of Vanare, Alexey Sokolin, the present generation of investors are finding it much harder to place their trust in financial institutions because of the economic problems during the 2000s. To compound the challenge, the financial advice industry is facing an unforeseen competitor that is poised to disrupt the way business is conducted.

Attack of the Robo Advisors

A Robo Financial Advisor is the marriage of the financial advice industry with the smart phone era. The apps are based on the basic structure of traditional financial firms, but they provide a much more personalised and time conserving method of managing finances to the tech savvy consumer. 

Already, hundreds and thousands of investors are using popular online financial management apps and a recent report by AT Kearney shows that Robo Financial Advisors will be controlling more than $2 trillion worth of assets by 2020.

Why Robo Financial Advisors work

The main reason that Robo Financial Advisor apps work is because the present generation of investors are hard pressed for money. In such a situation, it is not feasible to pay for transaction fees and to have an account minimum. 

Most financial transaction companies do not have feasible options for small amounts. At the same time, a business model cannot distribute the time of human financial advisors amongst a large group of low-asset clients and still manage to reap a profit.

Robo Financial Advisor apps are merely fulfilling the need to have a secure financial goal for a generation that is more comfortable with the technology of today.

How customers benefit

Most may argue that having apps to provide financial advice to people will mean that consumers will be far more disconnected with human beings than that already are. However, users of such apps usually tell a different story.

Jon Stein, the CEO and founder of Betterment, a financial planning company, believes that having Robo Financial Advice apps makes it possible for people to find more time to do the things they want to do. And as these apps have been tailored to suit each customer personally, the present generation of users are able to find much more freedom in their financial plans than ever before.

Want to know more about how mobile is impacting on consumer trends? Have a listen to our free customer experience webinar by clicking on the image below:


 Photo credit: Michelle M. F.

Brad Arsenault

Written by Brad Arsenault

Brad is the Head of Marketing at Fifth Quadrant. For over 16 years he's worked across digital marketing and content production. He actively publishes content on LinkedIn and Medium.

Topics: CX

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