Have you done anything this week within your business (or at home) to improve a task that you work on every day or every week? Is there something about that task that allows you to complete it in less time? Could you spend an extra five minutes working on it to create an outcome that is more valuable than what you currently produce?
If you did, you would be ‘innovating’.
Many people assume that innovation is all about developing new technologies and exciting gadgets. But there are many types of innovation – ranging from different business models, to customer service innovation, and even brand innovation.
What does ‘innovation’ mean for people in the financial advice profession?
One area of the advice industry that is undergoing massive disruption, both in terms of regulatory and from a technology perspective, is the wealth protection sector.
People no longer rely solely on the expertise and advice from a planner when determining their options for services such as life and health insurance, tax reduction options, and estate planning.
Companies like iSelect and Compare The Market, and even Government run websites such as privatehealth.gov.au have had huge success is providing online comparison tools for consumers looking to make their own decisions on insurance products. iSelect, for example, provides consumers with the tools they need to compare rates, fees, and even tax benefits on a variety of marketplace offerings for insurance products.
These kind of wealth protection tools and services have proven to be so successful, that offerings are beginning to extend beyond comparing just health and life insurance – they’re now assisting users to protect their wealth by selecting the best home and car loans, phone and internet packages, and even electricity and gas plans.
Though the example above spells ‘disruption’ for the industry, the actual companies that are implementing these changes are using a method called ‘channel innovation’. By this I mean that the channels they’re using to connect with and service their customers have changed dramatically from those which they’d have used traditionally.
To put this type of innovation further in to context, think about the ways that we have changed our relationships with retailers. If we want to buy a new pair of jeans, a TV, or even this week’s groceries we don’t even have to leave our houses to visit a shop. We can order anything we want online, at any time. The channel through which we access ‘shopping’ has changed entirely.
How you provide your product or service to your end customer can deliver massive competitive advantages
We are seeing advice being offered via video face to face meetings, tablets used as part of initial meetings, online brokers, robo-advice via the internet, crowd-funding of early stage businesses and online payday lending.
Channel innovation is all about connecting with your customers when and where they want you to. Technology is an obvious way to do this – think for example how many clients you might be able to see in one day if you didn’t have to travel to see them.
It’s possible that using video conferencing apps such as Skype or Suite Box for some or all of a client’s reviews, will allow you to offer your clients greater flexibility and options for when and where they can ‘meet’ with you at a time that works for them.
A great story of a company employing channel innovation in their financial advice practice is LearnVest – a financial advice service that has its financial advisers solely providing advice over the phone and via internet tools.
For a flat fee of $299, one of LearnVest’s 50-plus planners will speak with a client on the phone, draw up a financial plan and then walk the client through the plan online.
For an additional $19 per month, users get continued support via email, plus access to premium educational tips online. LearnVest also has a website and an app to help users track their progress.
LearnVest is able to deliver high-quality financial planning for less, because they are utilising easily accessible technologies to connect to more clients, in more locations. And as proof of their success, LearnVest now has 1.5 million registered users. And they sold to Northwestern Mutual for more than $250 million after only six years of business.
In the connected consumer world we live in, it is vital to embrace innovation and to identify the types of innovation that will add the most value to your service offering. Your customers will demand it, and your competitors are already doing it.
Think about the ways that you might be able to adopt the concept of ‘channel innovation’ in your practice today.
If you’re interested in learning more about innovation and how you can start making changes in your business, download our free eBook about how to innovate in a world of digital disruption.
Disclaimer
The views expressed in this article are those of the author and do not necessarily reflect those of netwealth Investments Limited’s.s
