“Everything becomes symbol and irony when you've been betrayed”
― Jay McInerney, Bright Lights, Big City
You have witnessed the way Amazon continues to defy expectations and undercut disparate groups of competitors. You find yourself wondering what it would be like if they were to enter the investment management industry. You anguish over how your firm would be able to compete with them. You are pragmatic enough to realize that the legacy systems at most RIAs are no match for Amazon’s algorithms. And you have been around long enough to know that the strength of your client relationships tends to correlate with the performance of the stock market.
In this context, Overstock.com, the internet retailer, introducing its very own robo advisory platform is greatly symbolic. It should go without saying that Overstock is certainly more Amazon-like than any RIA you have read about. So this isn’t just the latest flavor of robo-advisor. No, this is much more than that. While you have contemplated a world where traditional investment managers are competing with Amazon, Overstock’s 40 million unique visitors per month are likely to provide a hint of what’s to come.
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According to WealthManagement.com, Overstock has been tipping its hand: “it became one of the first major retailers to accept bitcoin, and is also developing blockchain technology. The company’s FinanceHub also offers lending, credit cards, and insurance services.”
You recognize that financial advisory services were the next logical step.
Overstock CEO Patrick Byrne said in the press release, “we are excited about this new program that offers our customers the opportunity to bring artificial intelligence to their financial planning.” Yes, of course. But, more broadly, the use of artificial intelligence will also be applied to put this new service in front of the right users at the right moment while they browse through Overstock. After all, 75% of the content that’s consumed on Netflix is the result of the platform’s recommendations.
You recall that Overstock has 40 million unique visitors per month.
You decide not to lay down in front of the steamroller when you can drive it. Rather than continuing the false narrative that robo-advisors are just for millennials, you study Amazon and Overstock’s playbook to learn how to mimic their success.
Otherwise, if you recognize the symbolism behind Overstock’s foray into investment management prior to being betrayed by your clients, will you still feel betrayed?