Advisers believe the next generation will have to incorporate robo-advice into their offering and work under a hybrid advice model, Octopus research suggests.
A total 81 per cent of adviser respondents to the research say aspects of robo-advice must be included in advice models.
Three quarters believe the UK advice market will run entirely on hybrid models, though 60 per cent say the transition will take longer the five years.
Octopus Investments chief executive Ruth Handcock says: “As many advisers clearly recognise, technology will play an increasingly important role in the future of financial advice, and there are obvious benefits for the industry.”
Advisers responding to the research cite hybrid technology as presenting more opportunities to interact with clients face-to-face, with 36 per cent also saying competition in the industry will increase.
Seventy-four per cent say incorporating robo into a blended model will be the catalyst for attracting younger clients to advice as well.
Chartered Institute for Securities and Investment head of financial planning Jacqueline Lockie says: “Millennials have different communication preferences with a tendency to rely more on technology and information online.
“However, research has found that young people are still big fans of human interaction and relationship-building, which is key to developing trust. This is why a hybrid model, with face-to-face advice, will be key in the future.”
One in ten respondents to the Octopus survey say robo-advice distracts from a traditional face-to-face proposition, while 11 per cent have concerns about whether robo can offer tailored services.
Seven per cent also say risk profiling offered by robo-advice is too imprecise.
The figures show around a quarter of advisers have some form of online advice service in their business.
A total 57 per cent are actively considering introducing a hybrid solution, while 16 per cent have no plans.