The rise of digitally-attuned consumers is not limited to the millennial generation.
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New digital advice services expected to arrive in New Zealand next year will benefit a range of consumers from beginner investors through to high net-worth individuals, according to a new white paper published by Auckland specialist consulting firm Mosaic Financial Services Infrastructure.
While digital advice is said to be targeting lower income groups, the report points to offshore evidence showing wealthier consumers are also switching on to automated advisory services.
Mosaic founding partner Myles Allan said the rise of digitally-attuned consumers is not limited to the millennial generation.
“All demographics are experiencing a ‘millennial’ shift,” Allan said.
“This is characterized by the increasing ease with and reliance on digital service delivery and an expectation of a great user experience across all personal services via their mobile phones or other digital devices.”
The Mosaic paper said, "it turns out the ‘millennials’ do have money and they need accommodating right now.”
However, Allan said digital advice also offers investors with fewer assets access to robust, institutional-grade financial advice.
“Face-to-face financial advice is usually a reasonably expensive exercise with advisers unable to efficiently service clients who fall below a certain level of assets,” he said. “DA provides those consumers an opportunity to receive decent financial advice and access to low-cost products – such as exchange-traded funds (ETFs) – albeit without much of the nuance associated with human-based advice.”
TheMosaic white paper also said the coming automated financial advice services won’t decimate traditional face-to-face advisory businesses – if they position themselves correctly.
“NZ is likely to follow overseas trends where ‘hybrid’ digital advice services are rapidly becoming the norm,” Allan said. “Progressive institutions and boutique advisory firms are including digital advice as part of a continuum where clients can graduate to human-fronted financial advice when they feel comfortable enough to do so,” Allan added.
While digital advice is said to be targeting lower income groups, the report points to offshore evidence showing wealthier consumers are also switching on to automated advisory services.
Mosaic founding partner Myles Allan said the rise of digitally-attuned consumers is not limited to the millennial generation.
“All demographics are experiencing a ‘millennial’ shift,” Allan said.
“This is characterized by the increasing ease with and reliance on digital service delivery and an expectation of a great user experience across all personal services via their mobile phones or other digital devices.”
The Mosaic paper said, "it turns out the ‘millennials’ do have money and they need accommodating right now.”
However, Allan said digital advice also offers investors with fewer assets access to robust, institutional-grade financial advice.
“Face-to-face financial advice is usually a reasonably expensive exercise with advisers unable to efficiently service clients who fall below a certain level of assets,” he said. “DA provides those consumers an opportunity to receive decent financial advice and access to low-cost products – such as exchange-traded funds (ETFs) – albeit without much of the nuance associated with human-based advice.”
TheMosaic white paper also said the coming automated financial advice services won’t decimate traditional face-to-face advisory businesses – if they position themselves correctly.
“NZ is likely to follow overseas trends where ‘hybrid’ digital advice services are rapidly becoming the norm,” Allan said. “Progressive institutions and boutique advisory firms are including digital advice as part of a continuum where clients can graduate to human-fronted financial advice when they feel comfortable enough to do so,” Allan added.
