30 Nov Advisory Qualities are the Most Important Factor in Robo-Advice
As an increasing number of financial institutions are starting to provide robo-advice to its clients, it is becoming increasingly more important to understand the factors that determine the robo-advice customer experience.
According to research published in Economics World by Diedrick Van Thiel, CEO of Advice Robo, and Fred Van Raaij, Professor of Economic Psychology at Tilburg University, the most significant factor affecting customer experience are the robo-advisors’ advising qualities.
Robo-advisors combine machine learning and big data to provide financial advice to customers. However, as Van Thiel states in his research, currently most “’robo advice’ is one a one size fits all solution. This could be much better, much more tailored.”
To determine how to improve customer experience and make robo-advisors more personalised, Van Thiel and Van Raaij developed the first cross-cultural model to evaluate customer experience of financial advice called the Digital Customer Experience (DCX) model. The DCX model designates the factors that affect the customer experience for digital financial advice platforms. The model was tested using an online survey encompassing 2,332 robo-advice consumers in the Netherlands and the UK. The model concluded that advising qualities is the most significant factor in both countries.
In the Netherlands, the top five factors affecting customers experience in digital financial advice are: advising qualities, advising style, pre-selection, co-creation and price.
In the UK, the five most influential factors affecting customer experience are advising qualities, process influence, price image, advice width, and accessibility.
While most robo-advisors today are not as personalised as customers would like them to be, there are startups that are actively addressing this issue. One of these startups is the Amsterdam-based fintech startup Advice Robo. Advice Robo offers robo-advice solutions and artificial intelligence scoring for innovative lending intuitions and is currently a member of London’s Level39 accelerator.
