Seven out of 10 Consumers Globally Welcome Robo-Advice for Banking, Insurance and Retirement Services, According to Accenture

Seven in 10 consumers around the world would welcome robo-advisory
services – computer-generated advice and services that are independent
of a human advisor – for their banking, insurance and retirement
planning, according to a new report by Accenture (NYSE:ACN). Yet, a
large number of consumers still want human interaction for their more
complex needs, leaving firms challenged with blending a physical
presence with an advanced digital user-experience, as they look to
integrate robot and human services.

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The global Distribution & Marketing Consumer
research
by Accenture, which includes a survey of nearly 33,000
consumers in 18 countries and regions, found that the vast majority are
willing to receive exclusively robo-generated advice for certain banking
and insurance products. Consumers are now open to robo-advice to help
determine which bank account to open (71 percent), which insurance
coverage to purchase (74 percent), and how to plan for retirement (68
percent). Nearly four out of five (78 percent) consumers said they would
welcome robo-advice for traditional investing, where the technology
first emerged.

Consumers also Expect First-Class Human Interaction

However, the study also found that nearly two-thirds of consumers still
want human interaction in financial services, especially to deal with
complaints (68 percent) and advice about complex products such as
mortgages (61 percent).

Piercarlo
Gera
, senior managing director, Accenture Financial Services, said:
“We found strong consumer demand exists today for robo-advice in all
areas of financial services – banking, insurance and financial advice.
While financial institutions may expect to benefit from internal cost
reduction by providing customers with a ‘robo’ option, our research
found that consumers also expect first-class human interaction.
Successful financial services firms will therefore need a “phygital”
strategy that seamlessly integrates technology, branch networks and
staff to provide a service that combines physical and digital
capabilities and gives consumers a choice.”

Consumers indicated the main attractions for using robo-advice platforms
is the prospect of faster (39 percent) and less expensive (31 percent)
services, and because they think computers/artificial intelligence are
more impartial and analytical than humans (26 percent).

The research found that the countries with the biggest appetite for
robo-advice are in the emerging economies of Indonesia (92 percent),
Thailand (90 percent), Brazil (86 percent) and Chile (84 percent) – all
markets where it is already common to use a smartphone or other digital
device as the primary vehicle for financial services interactions. Even
in the countries with the lowest demand – Canada (56 percent), Germany
(59 percent) and Australia (61 percent) – more than half of consumers
surveyed said they are willing to use robo-advice.

Non-traditional Providers Hold Strong Appeal

The survey also found that consumers are willing to switch to
non-traditional providers for financial services. Nearly one-third would
switch to Google, Amazon or Facebook for banking services (31 percent),
insurance services (29 percent) and financial advisory services (38
percent). For consumers aged 18 to 21 years old, the number willing to
switch banking services to one of these companies only rises to 41
percent, indicating that many younger consumers see value in traditional
financial institutions. Tech giants are not the only ones putting
pressure on financial service firms; nearly the same percentage of
global consumers would also consider switching to a supermarket or
retailer for their banking (31 percent) and insurance (30 percent)
services.

Alan
McIntyre
, senior managing director, head of Accenture
Banking
, said: “Consumers expect nearly all of their transactions to
be on par with the service they receive from GAFA (Google, Amazon,
Facebook and Apple) companies, which poses a challenge for banks in
particular. Banks need to create branches that provide an advanced
digital experience combined with convenient locations, while also
developing an online digital experience that can compete head on with
the tech giants. The vast majority of today’s consumers view their bank
relationships as entirely transactional; in order to gain customer
loyalty, banks have to be more assertive in using technology to provide
tailored, personalized offerings when, where and how customers want
them.”

Personalization

The survey found nearly two-thirds of consumers are interested in
personalized insurance (64 percent) and banking (63 percent) advice
based on their individual circumstances, and when asked about wealth
management advice, that increases to 73 percent. Nearly half of
consumers (48 percent) want banks to play a supporting role in the
purchasing process for non-banking products, such as a house or new car
or services related to those purchases (i.e. insurance products,
assistance with the sale and/or closing process). Consumers indicated
that banks could assist with these important decisions by sending
helpful information based on consumer location data, price range and
other personal preferences.

Data as Currency

The survey also found that consumers are willing to share their data
with financial services providers in exchange for benefits like less
expensive and faster services. Globally, 67 percent would grant their
bank access to more personal data, but 63 percent want more tailored
advice and demand a priority service – such as expedited loan approvals
– or a monetary benefit, such as more competitive pricing, in return for
the information they share. More than half (57 percent) of consumers
would grant their insurance provider access to personal data, but 64
percent want more tailored advice in exchange.

Three consumer personas

Accenture identified three distinct consumer personas from the research
with specific characteristics around what they value most from their
financial service providers, how they want to access services in the
future, and how they would like to embrace digital innovation.

Nomads: Highly digitally active group, ready for a new model of
delivery, represents 39 percent of consumers surveyed, but significantly
more in less developed economies, such as Brazil where Nomads were more
than 60 percent

Hunters: Searching for the best deal on price, represents 17
percent of consumers surveyed and tend to skew a little older

Quality Seekers: Looking for high quality, responsive service and
data protection, represents 44 percent of consumers

The full report can be downloaded at www.accenture.com/FSConsumerStudy.

Methodology

Accenture surveyed 32,715 respondents across 18 countries and regions
including the US, Canada, Benelux, France, Germany, Ireland, Italy,
Nordic countries, Spain, the United Kingdom, Brazil, Chile Australia,
Hong Kong, Indonesia, Japan, Singapore and Thailand. Respondents were
consumers of banking, insurance and wealth management services; they
were required to have a bank account and an insurance policy and were
asked if they used an Independent Financial Advisor, Wealth Manager or
Asset Manager, with total financial advisory responses totaling 9,987.
Respondents covered multiple generations and income levels. The survey
was conducted during May and June 2016.

About Accenture

Accenture is a leading global professional services company, providing a
broad range of services and solutions in strategy, consulting, digital,
technology and operations. Combining unmatched experience and
specialized skills across more than 40 industries and all business
functions – underpinned by the world’s largest delivery network –
Accenture works at the intersection of business and technology to help
clients improve their performance and create sustainable value for their
stakeholders. With more than 394,000 people serving clients in more than
120 countries, Accenture drives innovation to improve the way the world
works and lives. Visit us at www.accenture.com.

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