Asset managers that assume every advisor in a distribution channel (e.g., “Wirehouse” or “RIA”) is the same are missing opportunities to better connect with their customers. Enhanced data and segmentation can help segment advisors for better coverage, more meaningful engagements and an improved customer experience. In our advisor surveys, conducted in association with Horsesmouth, we ask advisors across the wealth management landscape about their portfolios, their experience with asset managers’ product offerings and wholesaling teams, and other topics relevant to trends in distribution. In our most recent survey, we asked advisors “Please select what best describes your operational model/practice affiliation” and compared their answers to the ones they gave when asked “What type of firm do you work for” and found several variations.
Of advisors who worked at an “Independent B/D Firm,” 23% identified their operational model as a “Hybrid RIA” and 8% as an “Independent RIA.” Of advisors who were “Dually Registered RIAs,” 28% identified their operational model as “independent affiliation with broker/dealer” and 16% as an “employee of the broker/dealer.”
We also encountered several advisors across firm types who identified their business model as “Private Client Group.” While some of these associations may be intuitive, the variation in the way advisors at the same type of firm think of their businesses points to the need to look beyond basic channelization of advisor firms. The type of firm that an advisor is associated with is increasingly not the optimal way to determine the coverage needs of that advisor. An advisor employed at an independent B/D firm may have more in common with an RIA due to the size of their underlying book of assets and their portfolio construction strategy. An independent RIA can potentially have business needs similar to a wirehouse advisor due to his/her use of an RIA home office or a TAMP.
Asset management firms can best determine these needs by undertaking extensive collection and tracking of data from all touchpoints with an advisor. Along with detailed quantitative and qualitative notes from sales meetings with each advisor, these will include:
- Feedback from marketing campaigns
- Conversations with portfolio specialists
- Ad hoc requests from the advisor
- Data from third parties
- Advisor visits to the company website
- Interaction through webinars/conferences/thought leadership/social media
This data should be used to create specific customer segments that group advisors according to similar business characteristics, priorities and requirements. Consequently, all internal groups within the asset manager must share the same customer segmentation model. An advisor should receive the same treatment whether dealing with a salesperson, a portfolio specialist or a marketing professional. All parties should also be up to date on the advisor’s latest interactions with their firm. Asset management firms that do this successfully will be able to consistently provide a highly personalized customer experience—an essential requirement for asset managers to align themselves with advisor interests and build long-term relationships in an environment filled with increasingly competing investment options.
SS&C’s Research, Analytics, and Consulting team can help asset managers target the best opportunities and optimize their distribution efforts. To learn more, read about our WalletShare analytics service and our consulting capabilities.
Research, Analytics, and Consulting