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Robo-Advice 2.0: The Next Generation




No new trend or development in the world of wealth management could have attracted more discussion, printed words or conference speeches than Robo-advice. Hailed as the new era in providing investment advice on a large scale to the emerging, digitally savvy generation, Robo-advice has spawned new names in this most traditional of markets. Betterment, Wealthfront, Nutmeg and others have emerged in recent years offering simple, engaging user interfaces, automated advice via algorithms and low fees. But already we are starting to consider how the next generation of such services will develop as the market matures. What is clear is that successful Robo-advice 2.0 services will focus not on the technology, but on the underlying investor and their very human needs. The key to successful proposition development continues to be a clear focus on the needs of the consumer, not on the clever technology. We believe this focus must be on three critical elements: an offer which is meaningful and relevant at all stages of the customer lifecycle, a cost structure that is transparent and low relative to traditional advice services and genuine simplicity (in language and process) throughout. If Robo-advice is to transform into a truly mainstream and global form of digital advice, Robo-advice 2.0 must create personal, relevant and differentiated services for real people.

Suggested Citation

  • Arwas, Andrew & Soleil, Katie, 2016. "Robo-Advice 2.0: The Next Generation," Journal of Financial Transformation, Capco Institute, vol. 43, pages 30-36.
  • Handle: RePEc:ris:jofitr:1567

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    References listed on IDEAS

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    More about this item


    RoboAdvice; wealth management; new entrants; new technologies; digital advice; asset management; Robo-advice;

    JEL classification:

    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D


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