AJ Bell’s new direct to consumer investment app Dodl has launched today (April 20), with its boss suggesting it will “create the advised clients of the future”.
Dodl is an execution only platform which operates alongside Youinvest, AJ Bell's other consumer-facing platform.
We ought to take at least 7 per cent, or more like 10 per cent, of this market over the next three years.Kevin DoranAccording to Kevin Doran, AJ Bell’s managing director of investments who has been overseeing Dodl’s launch - which was first announced in November - said the new service has been 14 months in the making, from concept to go-live.
“We’re creating the advised clients of the future,” he told FTAdviser. “Dodl is about extending the reach of AJ Bell. We’re focusing on people who haven’t invested yet.”
Drawing from recent Financial Conduct Authority data, Doran said there are around 8.6mn people who have more than £10,000 sitting in a deposit account which they have yet to invest.
“Around 20 per cent of those people will begin their investment journey in the next three years,” Doran explained.
At present, AJ Bell claims to hold a 7 per cent market share in the direct-to-consumer space through Youinvest, a web-based service.
But it anticipates holding a further 10 per cent share in what it would call an “adjacent market” Dodl is serving over the next three years.
“In the app-based investment platform, we ought to take at least 7 per cent, or more like 10 per cent, of this market over the next three years,” said Doran.
This translates to a target of around 1.72mn customers by 2025.
According to AJ Bell’s own market research prior to launch, the main reason why this 8.6mn market has not invested is down to being too scared, and not thinking investing is for them.
The company is therefore keen to keep charges as low as possible on this platform, as the cost and complexity which can come with cost was a big reason why people said they felt scared.
The charging structure for Dodl, compared to AJ Bell’s other two investment platforms, are as follows:
| Platform | Core annual platform charge | Dealing charges – ie, buying and selling investments |
|---|---|---|
| Dodl by AJ Bell | 0.15% (minimum of £1 per month) | Zero |
| Youinvest | 0.25% which scales down as assets grow | £9.95 |
| Investcentre | 0.2% which scales down as assets grow | £3.95 |
FTAdviser asked why the company decided to set different dealing charges, and how it might respond to advisers who feel they and their clients are fronting the cost of its direct-to-consumer platform.
An AJ Bell spokesperson highlighted that dealing charges for Investcentre (£3.95) are lower than its existing consumer platform Youinvest (£9.95).
They also added: "Dodl has a vastly reduced investment range compared to both Investcentre and Youinvest – 30 funds and 50 shares – and dealing is only processed once a day, as opposed to real time for shares via Investcentre and Youinvest.
"This simplified range and service enables us to operate Dodl without any dealing charges. That is not a proposition that would work for advisers though."
We don’t want to force advice onto people.Kevin DoranBeing an execution-only service, if a Dodl customer’s assets grow to a certain size there is no official step in place which will direct them to financial advice.
Instead, as has been the case with YouInvest, client communications and education material will suggest financial advice as an option if customers are unsure on how to manage their assets.
“We don’t want to force advice onto people,” said Doran. No advisers are on the Dodl roster, meaning customers will have to find an adviser themselves and then switch to AJ Bell’s advised platform, Investcentre.
ruby.hinchliffe@ft.com
