You have probably noticed the constant chattering in the media about robo-advisers and how they will take all our jobs away. Is this simply hype, or do you think there might be something deeper going on in our industry?

Some experts have suggested that within the next 10 years 50% of advisory firms will disappear or get acquired by more agile players. That’s quite the assertion.

But the question is, when will we start seeing more drastic moves in our market towards online advice and efficiency?

My educated guess is simply that I don’t know. No one does.

But first let me tell you the story of Kodak.

I believe it’s a paradigmatic example of how the dominant player in a huge industry can go from cash cow to flat broke over time, all due to slow but certain disruption.

From analog to digital

Past experience in any market shows that where a product or service becomes digitised, it doubles in performance and halves in price roughly every couple of years.

Will robo-advice be the iPhone?
This is sort of what cool looked like in the 80s. Nowadays most of these technologies are in our smartphones and cost close to nothing.

The origin of the digital camera is pretty amazingIt was developed by American Steven Sasson in 1975. It weighed 8 pounds (3.6 kg) and had only 0.01 megapixels.

It first took only 10 pictures and it cost $25,000. All the big players dismissed it as a gimmick and something which would never replace traditional, chemical high-res photography.

Will Advicefront be Steve Saxon's digital camera?
Steve Sasson with the original digital camera

Slowly but surely, as it happens in every industry, every couple years, we saw a 50% drop in price and a 100% increase in resolution.

First it was 0.01, then 0.02, then 0.04, 0.08, 0.16, 0.32, 0.64, 1.28, 2.56, 5.12, 10.24 and so on. And boom, the analogue camera was made almost obsolete.

And do you know who invented the digital camera? Eastman Kodak itself did.

However, Kodak was overtaken by other companies who saw the future of digital photography – Nikon, Canon, Panasonic and others.

Just like it happened with cameras, books, newspapers, music, voice telephony, taxis and hotels, financial advice is also undergoing silent disruption.

Everything from fact finds, signatures, rebalancing, cash-flow planning or CRM, just to name a few areas, seems to be moving online. Even meetings with clients are being conducted over the internet. Change in the way advisers operate is happening at a very fast pace.

It may not be too far-fetched to believe that within the next decade, meetings with clients could be carried out using high-definition holographic technology.

Robo-advice is sign of disruption

Whether or not this is the case, the times are changing. You might not notice it yet, but the technology is advancing and the smartest players are adapting to the spirit of the digital times.

And guess what? It’s also what clients want: convenience, pleasant experiences, shiny objects, feeling they are getting the best out there.

It’s pure business Darwinism, and whether you like it or not, it’s here. Firms will either adapt or be replaced by players who think differently and are willing to start disrupting themselves.

This can be done by starting to serve clients who are high earners but aren’t rich yet (‘HENRYs’) and Millennials who will inherit their parents’ money, just to give a couple of examples.

At Advicefront we are helping advisers digitise what is mechanical and low value, and focus on helping you plan your clients’ financial future, creating strong relationships with clients, and assisting them with the emotional side of money.

To find out how having a digital advice channel can help you, just request a demo or go to our website to learn more about how we can assist you in saving many hundreds of hours and thousands of pounds each year.

Let me know your thoughts about the direction of financial advice in the comments below or by following Advicefront on Twitter.