Last week’s launch of the iPad, which has to be the most hyped item of technology launched this year, combined neatly with the previous day’s news that Apple’s market capitalisation exceeded that of Microsoft. In effect, the market is saying that the most significant technology business on the planet, Apple, is now a consumer products company rather than an organisation that derives most of its revenue from servicing businesses.
These events carry an important message for anyone in financial services, they reinforce the view that power in the market is changing and no industry can be immune from the changes in demographics and behaviour which mean consumers of all types demand to be empowered. They want complex information but demand it is delivered in simple terms they can understand.
Increasingly, consumers operate on the basis of, “If I don’t understand something, I won’t buy it.” This is hardly surprising given the number of misselling scandals this industry has suffered.
I often hear people say that financial services are different and that consumers will not use the internet as an environment for financial services transactions because of security concerns. In this context it is important to recognise what Apple, Google and others are delivering with their app stores.
Clearly, the internet can be a very dangerous place, especially for people who are careless with their information. But if the internet is the digital equivalent of a big city where you are only a couple of wrong turns away from a dodgy neighbourhood, app stores are creating safegated communities where consumers can feel secure in the knowledge that their trusted brand is acting to keep out the cowboys.
Historically, advisers have been very good at building trusted relationships with consumers, so this is an obvious area to build on. Ideally adviser’s software suppliers should be building suitable apps for firms to deploy to build on this obvious opportunity. A couple have already done so, notably True Potential have had an iPhone app available for their clients to download for some time and Distribution Technology have a generic version available although I would have liked to see an adviser branded option.
Mobile phones are a massive opportunity to interact with clients as virtually everybody has one. Recent research by Morgan Stanley has identified that mobile internet use is in fact growing nearly three times faster than initial internet adoption did in the mid-Nineties, with use of mobile internet projected to exceed desktop use by 2014.
Tablet-type devices such as the iPad, because of their size, offer an opportunity to deliver an even richer experience. Personally, I have long believed that these devices will transform the way people access information in the same way as the iPod radically changed the way people store and listen to their music.
My early experiences with the iPad have been very positive. It is light enough to make it easy to use on the Tube instead of a newspaper, and the iPad app for The Times is a joy. From a work perspective, it took me only seconds to set up remote access to my MS Exchange email and the glass keyboard initially seems extremely user friendly. Because you don’t have the traditional noise associated with a real keyboard it seems quiet enough to use in a meeting to take notes. As a web browser, it is delightful.
To put this in context, yes, there are many things missing from the iPad, more output mechanisms, a camera for conferencing and a native handwriting recognition capability, but this is only version one. I fully expected my purchase of an iPad to be a research exercise but if my initial experiences are representative, I can see this becoming a valuable business tool very fast.
As someone who has been an avid Windows Tablet user for many years, I am seriously beginning to consider if this can replace my laptop PC. In the next few months, I will be testing a range of business applications for the iPad and will report back on my findings.
One of my main challenges has been keeping it out of the hands of my girlfriend who, having initially said she could not see herself having use for such a device, will now pick it up to use if I leave it idle for a moment. Emma is very much in Generation Y, so clearly the appeal is not just to boring business-types like myself.
Previously, I have predicted that Apple could make vast inroads into Blackberry’s market share if only they could address the security questions raised over their devices. It would appear they are making serious steps in this area. It was recently announced that Standard Chartered bank are to adopt the iPhone as their “smartphone of choice”.
There are also reports that Singapore’s Oversea-Chinese Banking Corp has taken similar steps offering their staff the choice of either Apple or Blackberry devices. This is a really important development and a subject I will be revisiting in this column in the near future.
Apple’s new role as the pre-eminent global technology supplier is a clear indication of a much wider change in society. This demonstrates the extent to which industries need to adapt to meet the needs of 21st Century consumers, if embraced apps can provide a secure complement to the advisers own services. One of the main questions I will be asking software suppliers in the coming months is when are you launching your iPhone and iPad apps as well as those for other platforms.
For the reasons outlined above, I believe this should increasingly become a key selection criteria for any adviser looking to acquire the technology they will need to service clients in a post-RDR environment.