How ‘robo’ platforms for advisors should and should not be used

Michael Kitces, as is usual for him, asks some relevant and tough questions. You can read his recap of the T3 goings on HERE, but the key question that he raises is as follows: “Most advisors don’t have a high volume of prospective clientele coming to their websites, where their key problem is figuring out how to accept and onboard those clients in an efficient purely digital manner (with “robo” tools).”

So, are ‘robo’ platforms for advisors like Advisor BioniX solving a problem that most firms simply do not have? We believe that Michael is right and advisors should not count on converting any (much less many) users directly from their websites without speaking to them. The bar for someone to simply click on an advertising banner is raised very high nowadays,  because people are constantly bombarded with advertisements. To have someone actually open an account in your firm purely based on visiting your website is a very tall order indeed. In our opinion advisors will (and should) use ‘robo’ technology differently from the Wealthfronts of the world. A ‘robo’ platform like our BioniX really serves two functions. 
1. It allows advisors to keep and even actively sell clients who are not able to pay the full fee now. For example, what about children and nephews of your loyal clients? Instead of ignoring them and hoping they eventually come to you, you can actively solicit your loyal clients to bring them onto your ‘robo’ platform at a lower level of service (like a quarterly phone call and some tax advice for a few $100’s per year). This can be an efficient way to generate extra revenue and fill your pipeline for the future. This method can also work in advising on a huge 401K market that is out there. 
2. A ‘robo’ platform for advisors will serve as a client portal on advisor’s website with a login that will contain on-demand information that more and more investors now require.

New uses will no doubt develop, but advisors will need to use the platform actively and not just hoping for a flood of signups.


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1 Response

  1. Pingback : How Vanguard is Staying Competitive with Robo Advisors

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