As much as they are disruptors of sorts, traditional banks view robo-advisors as healthy. They represent a challenge for incumbents, one that will ultimately result in better customer experiences. Financial institutions believe that the foundation of what they do is not going to go away; however, it puts pressure on them to focus on the customer experience and, ultimately, the customer journey.
A compelling digital strategy finds a balance between maintaining what you already offer while providing new, disruptive ideas that will get you to next level, hold off competition, and entice new customers. We present five digital essentials to help you rise to the challenge.
The conversation between incumbents and entrants has evolved over time. It went from hostility to a much healthier debate on how all parties are going to collaborate. Incumbents have been around for a very long time and customers have made a conscious decision to trust them with their assets. Trust is the foundation.
Robo-advisors may not necessarily eliminate traditional human-to-human relationships, but they put the onus on traditional banks to put forth a better customer experience with digital technology. If banks don’t respond to the challenge and stick their heads in the sand, customers will gravitate towards convenience and simplicity. The pressure is no doubt real.
Traditional wealth management services and robo-advising are actually quite complementary. Part of the market currently wants, and will continue to want, a hands-off approach to investing and wealth management, one in which everything is done for them. On the other hand, a growing portion of the market prefers to manage their wealth on their own. To meet this new demand from current and potential clients, banks must satisfy their thirst for this digital experience. Robo-advisor tools can help address this need.
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