Originally published on Financial Planning | September 11, 2018

By Anton Honikman, MyVest CEO

I’m just a regular guy, average height, average build, but I have a 17.5-inch neck. That makes shirt shopping incredibly difficult. What fits my neck leaves the rest of me swimming in fabric.

Until recently, someone like myself had two options: Get a personal tailor and build a custom wardrobe, or buy a shirt off the rack and pay extra for alterations.

But now, digital platforms are disrupting the apparel industry, just as they have wealth management.

Custom clothing apps are bringing bespoke tailoring to a broader audience. With the click of a button (your phone’s camera) you take your own measurements (20% more accurately than a professional tailor), you choose your fabric and shirt style, and voila, your custom-tailored shirts are delivered to your doorstep. All at the same price of an off-the-shelf department store shirt.

Now anyone with a smartphone has access to made-to-order clothing — previously only available to the wealthy. Mass production has been replaced by mass personalization.

All of a sudden, we see an industry conforming to us, rather than requiring us to conform to the needs of an industry. Each of us now represents a “market of one.”

Consider the first few decades of the mutual fund. While they provided retail investors with an easy way to buy a diversified and professionally managed portfolio, they still represented a fairly narrow set of categories. This mass production offered firms economies of scale and gave more consumers diversified access to the market. But it was not necessarily the best fit for the customer; it was still a one-size-fits-most mindset.

The advent of the ETF industry produced a generally better product, enabling lots more choice. But ultimately, it is still about the consumer conforming to an industry that must mass produce product to achieve margin.

Our industry will follow in the footsteps of made-to-order apparel. I envision a post-mutual fund world, in which consumers will no longer be forced to choose from off-the-shelf packaged products and will instead receive portfolios tailored precisely to their unique measurements.

All of this converges to create a world in which not only is the solution itself better, but the experience of consuming the solution is better.

We see this transformation happening around us every day — from what Netflix is doing with media, to Spotify’s influence on music, to Amazon’s impact on retail. And it’s coming to wealth management faster than you think.

Author’s note: the term “markets of one” is not original. I was inspired by Hemant Taneja’s Unscaled, a superb book in which he outlines a vision for the artificial intelligence-based disruption of many traditional industries built on scale economies, including financial services.

This article originally appeared in Financial Planning’s Voices.