Following an ifa editorial that examined the significance of AMP’s goals-based advice strategy, the company granted ifa access to the flagship “Goals 360 experience” store at AMP’s Circular Quay headquarters and a demonstration of its goals-based advice process.
The process allows consumers to identify their priorities among 29 financial and life goals and use an artificial intelligence-backed system to embark on an advice process with one of AMP’s “goals coaches”.
In an exclusive interview after the tour, Jack Regan, AMP group executive, advice and New Zealand, revealed that the country’s largest advice provider potentially has big plans for its new toy.
“We’ve essentially created a scaled pilot to effectively test and learn and develop out the program,” Mr Regan explained.
“Most of the IT build we expect will be completed in 2017 [but] a lot won’t still be embedded until we get to about the middle of 2018. And it’s after that point in time that we’ll start to think about scale.”
Mr Regan said that AMP-aligned practices will have the opportunity to integrate elements of the AMP Advice goals-based model into their business but stressed that the rollout would not become mandatory.
“The key premise here is that most of our licensee businesses are self-employed practices so ultimately it’s the business owners who are going to be making that decision,” he said. “They get sovereignty over their businesses.”
Asked whether AMP may also look to white-label the product outside of the network, Mr Regan said the company is considering offering it to the IFA market or even competitors in the long-term, pending the results of the pilot program.
“We think that there’s an opportunity there potentially down the track so it is more over the immediate horizon, but the reality is that we will use this as a vehicle to take advice more broadly,” he said.
“It sort of follows then that if we can do that then we have a digital spine, we’ve got a capability around building goals-based advice that is in fact leverageable across many brands.”
The program is currently only being used by advisers licensed by AMP Advice, many of whom are salaried advisers transitioned from ipac by the company since late 2016. AMP chief executive Craig Meller told an investor briefing in May that AMP Advice is at the centre of the company’s plans to drive revenue in its wealth arm.
AMP values its “goals exploration sessions” at $350 but is currently providing them free of charge to consumers for a “limited time only”, according to its website.
Mushroom, you’re right. In fact, goals-based advising is a tautology (for example ‘the dark night’). What other form of advice is there?
Honest question: Can someone explain goals based advice to me. I keep hearing it but no description of the process. Is it identifying a person/s goals and objectives, allocating a cost to it and a time frame? Then developing a strategy to meet each of these and reviewing periodically progress towards them. Am I missing something as this is what has been part of the advice process for over 20 years. I am interested in what this means in 2017 compared to 1996 because I really don’t know. Maybe its just corporate ‘speak to make it look like something new?
Read the article from Jacqui Henderson on the IFA home page.
Thanks, that helps. Seems a lot of advisers are wondering what others have been doing all these years before AMP decided to brand it as something new. Pretty sure identifying goals is the first step of the FPA’s advice process which has been around for years.
So that means existing commission plus $350 capped in the mind of consumers.
When we get to 80% commission the client will pay that, plus $350, and the adviser will be discouraged from spending more.
sovereingty over their businesses my arse. good one AMP
As someone that works at AMP I don’t know where you’re coming from. We allow you to use COIN, XPLAN, we provide a possibility for you to use neither, and we support all of that directly. Now you’ve also got the option of AMP Advice, which granted is a huge business change, is still another option you have. What is it that you don’t have sovereignty over? I worked for an MLC practice and it was much more rigid.