Over the years there’s been a significant evolution in the mortgage advice market, with technology playing a crucial role in its transformation.
From robo advisers to artificial intelligence, the sector is rapidly changing to service clients better and reach more people.
There are five stages of the tech-adoption curve: innovators, early adopters, early majority, late majority and laggards.
At some point, being behind the curve will prove an issue
The first to adopt new tech are innovators; usually a smaller group of risk takers who aren’t afraid to try new products and are excited about new concepts.
Early adopters are next. They are often leaders who want to copy innovators and adopt the tech if it can give them a competitive advantage.
After early adopters comes the early majority; the largest group of tech adopters. They tend to introduce new tech cautiously and want to know if it has a record of success.
The late majority follows. They generally jump on adopting new tech when they realise, if they don’t, they will be left behind.
Keep your tech-adoption curve in mind but take a closer look at the group of people you want to reach
Laggards are the last group, often set in their ways. They may eventually adopt new tech but they’re usually buying version one while you’re selling version two, or even version three.
The best way to reach and convert the different groups is to understand their motivations and concerns.
Both innovators and early adopters are actively seeking new ways to get ahead of others. They don’t mind taking risks and trying new things. The most important thing to show them is the potential your tech has and its uniqueness. What does it do that other tech doesn’t? What problem can you fix for them?
Partnering with innovators
At Twenty7tec, when we set up the business we partnered with people who were innovators and who had already identified the problem that we then solved for them. They wanted certainty in results when sourcing mortgages across the whole of the market, and we found those people and successfully created a product that worked for them.
There are broader groups out there that still haven’t adopted the tech that would improve their methods and make them more profitable
The early adopters are influenced by the innovators: the cool kids. They see a trend and jump on it early. When some brokers knew what we’d done for the most innovative group, they simply had to be on board.
The early majority wants proven success. They may be concerned about the cost or practicality of new tech but, if you can demonstrate that it’s worth their time and investment, you can win them over.
But the biggest hurdle for them is risk: will it make them better at their job? Will it help their business?
Many of them will act only when they think that by not acting they are risking their career or company
To win over this crowd, you don’t need to bedazzle them with new functionality. You have to use cases studies and show them it’s safe. The early majority of mortgage brokers saw that the innovators were having success with our product and that there were clear benefits to adopting it.
Late majority
The late majority is more resistant to change. They don’t want to take risks, so they need convincing through practical benefits and when something is becoming the market standard.
For this group, psychological safety is still really important, but many of them will act only when they think that by not acting they are risking their career or company. Early-stage marketing (to the first three groups) should avoid using fear, uncertainty and doubt to ‘sell’ a product. But, if you’re at 50% of the market, it’s one of the main motivating factors.
Finally, converting laggards can be a slow process. My sense is that, by the time the late majority is buying your service, you’re probably on to version 2.0 and engaging with innovators again. In other words, doing cutting-edge, profitable work. If so, most tech companies will focus on the next round of development.
The late majority generally jump on adopting new tech when they realise, if they don’t, they will be left behind
In the past nine years of Twenty7tec, we’ve been through all these stages in the mortgage sector and marketed to all these groups repeatedly. Yet, in the wealth sector, we’re at a different point in our journey. We’re starting to get the innovators on board, and the early adopters are looking too.
But there are broader groups out there that still haven’t adopted the tech that would improve their methods and make them more profitable.
At some point, being behind the times with adopting tech will prove an issue for advisers because there will be a disparity between those who have adopted it and those who need to catch up. And there will be a gap between the clients who are getting the best service and advice they can, and those who aren’t.
The first to adopt new tech are innovators; usually a smaller group of risk takers who aren’t afraid to try new products and are excited about new concepts
Although we can categorise these groups by shared behaviour, people don’t consistently fall into one group. For example, you may be an Apple super-user and buy all the devices as soon as they’re released, yet refuse to engage with any form of mortgage advice technology.
People are complex. That’s why it’s essential to keep your tech-adoption curve in mind but take a closer look at the group of people you want to reach.
James Tucker is chief executive of Twenty7Tec
This article featured in the April 2023 edition of MS.
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