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What can we expect from financial advice in 2023?

Exciting experiences drive economic growth.


The experience economy has been around and spoken about since 1998, but it’s yet to really become apparent in advice. Economists have typically lumped experiences in with services - which is what advisors provide. But experiences are becoming more distinct and being desired and bought by clients. This is because services, like goods before them, have become commoditized.


Robo-advice, investing apps, and other tech-driven financial services solutions have now proliferated the industry, commoditizing the traditional services advisors provide. However, most clients still value having a human connection within the field of finance; this is where experiences have emerged as the next step in the progression of value.


In 2023, expect many forward-thinking firms to start investing in their client experience, creating additional value for clients - value clients will be happy to pay for.


The client takes center stage in the advice experience


Clients will begin to demand changes to the advice experience, altering it to become more akin to what they have come to expect from other service providers. The annual review will no longer be the main event, becoming a hygiene factor to check in on progress and reassess their current situation. Instead, clients will come to expect "on-demand" advice.


Let me explain: much like we can watch any show at any time on Netflix, clients will expect they will be able to engage with their advisor or plan whenever they want. This means they’ll need access to a digital platform or portal to communicate with their advisor or interact with their plan outside of meetings and the office.


This will see an increase in advice engagement tools that help advisors to continuously engage their clients. Expect to see:

  • More automated nudges and notifications on mobiles and wearables to communicate with clients.

  • “In-portal” support becomes more thoughtful to guide clients on their next best action.

  • Many more new tools, features and technologies will empower clients to make informed choices aligned with their plans.


The best part: a decline in the old "just give me a call" or "just pop in" model as clients get smarter ways to engage with their financial plan outside of the traditional meeting structure.


To serve more clients, firms need more specializations.


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​To make advice more accessible to more people, advice businesses must operate at scale, serving many more clients than the average adviser does today. However, with scale comes the need for more roles and specializations in positions they might not have considered before, such as designers, data analysts, tech specialists, and relationship or lifestyle managers. Many firms will look to outsource these positions turning to consultancies, freelancers, or tech solutions. In contrast, others will double down on their employee value proposition and look to attract diverse talent from different industries to add the scale they need. One thing is certain: the war for talent, whether in-house or outsourced, will only increase alongside the need to scale and specialize to serve more clients.

​In 2022, firms largely grew their book of clients through M&A. This has led to many firms serving large numbers of clients differently across their entire organization. An inconsistent approach not only reduces referral potential but also limits a firm's ability to scale as it remains people-dependent. Those businesses looking to scale and expand will need to find in-house, outsourced, or tech specializations to help get their houses in order and achieve growth. This could mean hiring experience designers, data analysts, or relationship managers. Or bringing on board consultancies or freelancers to identify and plug the gaps needed to scale. What we expect: Even more will turn to technology and change managers to implement new consistent experiences across the organization. Using relationship managers to arbitrage clients to specialist advisors as and when they need them to provide holistic, client-centered advice at scale.


Know your niche

The word niche is commonplace in business circles, and the success of companies that have found their niche continues to make the headlines.


In 2023, we'll see advice firms get better at knowing and owning their niche - whether that be: 45-year-old holiday junkies who want to make work optional; purposeful CEOs wishing to dedicate more time to those they love; or family protectors who want to help others live a more purposeful life.


This impact will see businesses get laser-focused on the intricacies of their advice or their specific client's life needs. And, without the distraction of trying to build models for every type of client or advice, we'll see some really unique models explode onto the scene. Models that empower more clients to live their best life while the firm experiences significant growth.


Human-centered tech will continue to expand & businesses that can back it up will win

The FinTech juggernaut is one giant snowball. Each year it evolves, and we're seeing more and more human-centered tech taking advice principles and automating parts of the client experience.


As those FinTechs gather more data through usage, their capabilities will only expand into solutions we have yet to dream of, supporting clients in taking the next best action without human analysis or guidance.


However, deploying these technologies alone won’t make you a winning advice firm. Those who know how to intertwine new technologies with human skills and emotional intelligence to create a “bionic advice” experience will win.


Businesses that harness data will win.

How many years have we heard that data is the new oil? Yet, we have only seen the benefits of data play out for business and investment performance. 2023 will see more firms curious about how to best leverage their qualitative, unstructured data gathered from their high-quality conversations with clients.


By analyzing and understanding this client data at an aggregate level - including their values, goals, dreams and aspirations - they will uncover unique insights that will enable them to gain a competitive advantage.


Challenges remain around capturing and structuring this data, but those that deploy the technology, tools and time to understand it will see tremendous gains in 2023.


Differentiate or stagnate.





​With the challenges surrounding organic growth, firms will need to effectively differentiate in a market increasingly dominated by firms with size and scale. With M&A activity increasing in the IFA market, creating mini mega groups, and with banks and superfunds thinking of dipping their toes back into a market less regulated (should deregulation happen), they have the size and scale to compete nationally. They also have the capital to reach a large audience, with marketing campaigns to promote their size and broad scope of services. They also have the brand equity and trust to be seen as a preferred supplier - “I’ve heard of that brand, so I will choose them.” Our brains, as consumers, just love taking shortcuts when making decisions. This will make it much more challenging for smaller independent firms to compete directly, even locally. To do so, they must create, adopt and implement a more unique and valuable client experience. One that is memorable to clients and gets them referring their adviser in social settings, helping to increase the reach and trust of these brands amongst their target audiences. This means creating experiences that break free from the traditional financial advice experience focused on assets, portfolios, and super and into what people actually care about - their life, values, and goals. Expect to see many more “lifestyle” focused advisors kicking goals in 2023 as they put life first and finances second in their client experience.

​With the challenges surrounding organic growth, firms will need to effectively differentiate in a market increasingly dominated by firms with size and scale. Aggregators like Creative, Edelman, and the like have built firms large enough to go national. They also have the capital to reach a large audience, with marketing campaigns designed to promote their size and broad scope of services. They also have the brand equity and trust to be seen as a preferred supplier. This will make it much more challenging for RIA’s with under $1 billion in AUM to compete directly. To do so, they must create, adopt and implement a more unique and valuable client experience. One that is memorable to clients and gets them referring their adviser in social settings, helping to increase the reach and trust of these brands amongst their target audiences. This means creating experiences that break free from the traditional financial advice experience focused on assets, portfolios, and tax harvesting and into what people actually care about - their life, values, and goals. Expect to see many more “lifestyle” focused advisors kicking goals in 2023 as they put life first and finances second in their client experience.


Pumping up the pressure

After spending the last 12 years gathering assets, most RIA's need to pause and consolidate their gains. With the market no longer providing momentum to the upside, healthy margins are under increasing pressure. And, with fears of a recession on the horizon, they are starting to batten down the hatches and prepare for the worst, mainly as organic growth is not offering the lifeline it once was.


Firms must implement sound business strategies to reduce costs, flip fixed costs to variable and get back to sound practice management. It means focusing on what they do best and making the most of their critical assets within the business - with the number one most important asset being their people.


This means that any spending should focus on making their workforce more effective. That means replacing “excel sheet” processes, pen and paper data capture, and reliance on star performers with systems and technologies that remove the admin, manual data capture, and training requirements needed to make your team successful.


Expect to see a wealth of new technologies come to market built around the advice process that offers repeatable, scalable, and measurable support to the front office function. That will empower your teams to do what they do best - be human - while allowing the machines to take over the rest - data capture, workflows, and measurement.


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