Financial advisers should adopt a hybrid approach to customer interactions when it comes to helping digital natives – or the so-called Millennials and Generation Z.
Katrina Shanks, CEO of Financial Advice NZ, recommends advisers use a mixture of personal service and automated systems in a mix-and-match approach to doing business in today’s online world.
“Digital native consumers are looking for experiences rather than products and their views on life insurance are changing, she says. “They want holistic solutions that are tailored to their needs rather than one-off transactions happening in a vacuum.
“Younger generations expect digital capabilities – they look for convenient, personal, quick, digital experiences with all the companies they interact with. What’s more, generational views on life insurance are also changing, shifting to an holistic view for health, wealth, and wellness.”
Shanks says these are all key considerations for adviser businesses wanting to adapt their services to clients’ evolving needs.
“The issue of underinsurance in New Zealand is well-documented, stemming from varied factors such as demographics, perceived affordability, misinformation, reliance on public healthcare, ACC, and a lack of understanding of the insurance solutions,” she says.
“In this landscape, the right digital tools – calculators, chatbots, automated emails to name a few – can facilitate access to quality advice, while also empowering financial literacy.”
This transition to transactions via apps, automated phone systems, and websites doesn’t mean financial advisers will be excluded from the conversation, says Shanks.
She points to a 2020 report by accountancy firm KPMG Australia that found 72% of respondents to its survey wanted assistance from a real person when extra help with their queries was needed.
…robo-advice cannot – and probably never will – replace the emotional support of a professional financial adviser…
“It’s becoming clear that robo-advice cannot – and probably never will – replace the emotional support, expertise and wisdom offered by a professional financial adviser,” says Shanks.
“There’s a strong argument for advisers to adopt a hybrid approach, designed to provide a seamless link between human touch and digital experience.”
Shanks says traditional and innovative approaches can co-exist.
“The substance of financial advice doesn’t change; at its core an adviser’s empathy, knowledge and expertise are irreplaceable,” she says.
“By adopting digital technologies and innovative pathways that meet and exceed the changing needs of consumers, advisers can let the fundamental strength of quality advice shine even brighter.”