We sat down with Sharesight CEO, Doug Morris, to talk about recent trends shaking up the financial services industry.  Read on for a recap of the discussion!

 

 

Demand for a 21st century financial experience  

 

From the way we get around to our exercising habits, technology has revolutionised many areas of our lives. Today, the pressure is mounting on finance and the investments sectors to deliver the same integrated, 21st century customer experience. Whether it be your mobile phone provider or your favourite food delivery app, the bar has been set high when it comes to the modern customer experience. Amidst the wave of industry change, new technology presents an opportunity for advisers to become the heart of their clients’ financial world.

 

The rise of self-directed investing (via a vis SMSFs)

 

Increasingly, investors are cutting out traditional and expensive wealth managers and adopting robo advice and “do-it-yourself” approaches. As digital technology becomes more critical to the client experience, more people are actively engaging with their finances. This is an encouraging trend for financial advisers as it gives them the opportunity to potentially play a key role in how clients evolve their financial world.

 

The proliferation of retail friendly products

 

Over the last 10 years, there has been a shift away from traditional managed funds as more and more investors turn to exchange traded funds (ETFs) to generate income. Today, ETFs are a phenomenon. People are investing more money in ETFs, and investment products such as LICs are becoming more sophisticated. In the last 12 month, 23 new ETFs have listed on the ASX, and the asset growth has been up around 70%.  

 

Fee pressure & the rise of fee-for-service models/IFAs

 

The way advisers are charging for their services is evolving. Arriving at the “right” price has been a challenge for the industry, which has been largely scrutinized by the Royal Commission. The emergence of robo advice and do-it-yourself platforms has placed pressure on advisers to re-think their fee structure with many moving towards a fee-for-service model. To be able to demonstrate and add value to clients in today’s investment landscape, it is key for advisers to embrace and accommodate a combination of traditional and do-it-yourself platforms.

 

Demand for transparency

 

Beyond finding the right fee structure – which now goes beyond highlighting one’s experience and approach – the Royal Commission has made disclosure and transparency top of mind for many financial service providers. Customers themselves are demanding more transparency; technology is helping advisers align client expectations and demonstrate value of service.

 

Shifting customer demands and industry trends are reshaping the face of the financial industry. But the good news is, technology can help advisers keep up with industry changes and deliver on (and even exceed!) client expectations.

 

How are you delivering on client expectations in the 21st century?