This may be acceptable to the baby boomers who make up much of the current client base of the typical adviser but is hardly an approach which is likely to go down well with the next generation of financial consumers. These young adults have grown up with the internet at their fingertips and have different attitudes to researching and buying goods and services.
It is fortunate that the baby boomer generation is approaching or entering retirement and there is an enormous need to provide them with advice on how to stretch their assets to last for the remainder of their lives. This will probably provide anyone currently working in the adviser community with an adequate source of income for the rest of their careers. This is just as well since IFAs' technophobia is increasingly causing me to conclude that face-to-face advice as we know it will die with the current generation of advisers.
The at-retirement market may provide an adequate income stream for individual advisers but this does not bode well for the future of the businesses they work for.
I am increasingly coming across organisations where a long-term strategic review indicates that over the next 20 to 25 years, financial advice will become a very different service, delivered primarily online or via call centres by major providers.
If our industry wishes to service the financial services needs of the emerging generations, it is essential that we learn about the ways in which they wish to do business and communicate. Sadly, there are few examples of companies putting in place new ways of working to meet the needs of young consumers.
Elsewhere in the world, it would appear that at least one life office is taking an innovative approach to the challenge of working with the next generation. Encouragingly, it is an offshoot of a UK company that seems to be leading the way. Aviva USA has recently created an island within the Second Life virtual world (see secondlife.com) with the objective of recruiting the next generation of life insurance salespeople.
Second Life is a computer generated virtual world where players can create an identity and interact with one another and even buy and sell services, goods and property. There are more than 15 million registered users for the service.
Working with IBM in the $500,000 project has enabled Aviva USA to address an Admittance to the Aviva island is currently by invitation only but a demonstration of the service can be found at http://www.hanser.com/AvivaUSA_Machinima_Short_FINAL.wmv important business need while examining the potential for this rapidly growing technology. Executive vice-president and chief information officer Mike Boltz is adamant that "this is not like your dad's insurance company" and says the objective was to make it clear to future business partners that Aviva is keen to communicate with young consumers in new ways.
During the construction of the site, Boltz was able to interact with the IBM team carrying out the work. He says: "I was able to go on to the site and ask IBM staff what they were doing at any time. This was an entirely new way of working and it really got my spine tingling."
Aviva's island created considerable interest when launched at the Million Dollar Round Table meeting in Toronto in June. Entering the island, visitors arrive at a welcome area which shows all the countries in which it operates. An orientation trail allows them to understand the basics of Second Life and a waterway transportation system can take them to key destinations on the island.
One such stop along the waterway is an area designed for financial professionals, including an amphitheatre for viewing presentations and conference rooms for smaller groups. During the fourth quarter of 2008, Aviva will be launching dedicated training material to be used in this area.
As a communication tool, the service operates in a similar way to web-based conferencing services such as Go To Meeting and WebEx but is a far richer visual experience. Designed to work with a parallel audio conference call, video, documents and a wide range of other materials can be built into the service and be accessed by users.
It is clear that Aviva sees major commercial benefits in being able to deliver highly interactive training to advisers without the need for face-to-face meetings.
Other areas within the site include a history of Norwich Union, including interesting facts such as NU's introduction of the first motorised fire engine in England in 1905 and Commercial Union insuring the Titanic in 1912. I actually learnt a great deal about the history of the business and it is easy to see how this would bring to life a company that many young people may find rather staid. The Bright Future area gives visitors a feel for the future of the company, including information about its new US corporate headquarters due to open in 2010.
It is great to see an insurer delivering a highly interactive experience, for a relatively modest budget, which will be relevant to young consumers. Many areas of the US site could clearly be imported to the UK relatively quickly. If we are to face up to competition from more vibrant consumer-orientated companies, it is essential to start talking to young consumers by their chosen methods.