Practical Intelligence Barometer Summer 2012
Christopher Ambler Managing Director 91-93 Farringdon Road London EC1M 3LN
[email protected] +44 (0)7890 992785
www.fundamentals.co.uk
About the Barometer • Intelligent independent insight • A joint initiative – Fundamentals and Broadgate Mainland • Our commitment to the industry we serve
Fundamentals • Bringing fresh thinking to communication in the investment market through: • Insight • Intelligence • Inspiration
Topics • Major issues • The RDR • Which investment model? • Best Investment Houses • Views on DFMs • Best platforms • Marketing communications insights
IFA issues • RDR still top of mind • Concern about “a combative regulator” • Continuing lack of clarity • Fear of loss of confidence by investors • How to deal with lower value clients • Sheer volume of changes and issues • Finding income for clients
RDR readiness • Most are ready • Acceptance that the quality of advice will improve but... • Corporate culture more important than regulation • Clients have no interest, and... • Trust and service more relevant to clients than Independent or Restricted titles
“Clients don’t care, look at St James’s Place... they want people that can build relationships”
“The banks seem hell bent on destroying any vestige of trust in financial services”
“You have to earn client’s trust...they expect you to lead... that’s why they pay us”
“The issue is, can I afford the client?”
Investment selection models chosen 45% 40%
Investment selec+on models chosen -‐ %
35% 30% 25% 20% 15% 10% 5% 0%
Con,nue to Using model provide whole por>olio of market solu,ons advice through pla>orms
Partnering with DFMs
Using one of the growing number of mul,-‐asset funds
A variety of the above/ other ideas
Other
“Using a model portfolio solution takes us away from choosing funds and, generally speaking, IFAS are not good at fund selection. They rely too heavily on one factor – past performance”
“We use multi asset funds for lower end clients”
“I think model portfolios are totally unjustified because everyone is an individual”
“Some allocation to multi asset but as DFMs, it seems like dilution and duplication”
Attitude to DFMs • Focused on HNW clients • IFAs find it difficult to articulate how they evaluate DFMs • Relationship • Track record (concern about start ups) • Investment process/solutions • Duplication of process
• Some see DFMs as a problem “I will still be blamed” • VAT issue • Costs in general – impact on client and themselves
Best platforms • No platforms seem to stand out • Most use a variety • Consensus that there will be consolidation post RDR • Service and flexibility important e.g. “in species transfers” • Some still doing business direct
“We use AXA Elevate due to lower charges and more flexibility on switching”
“The obvious ones are Skandia, Cofunds and Fidelity Funds Network”
“We like Transact but they may get squeezed out”
“In my opinion the next storm will be about how the platforms attract business, and TCF”
“Vast majority of our new business is on Nexus because it offers open market access”
Business model impact Component buyer Decision maker
Continuing interest in investment houses and their propositions Need for a deep relationship with top companies
Segmented service
Solutions buyer
Decision maker and influencer
Influencer
Continuing interest in investment houses and their propositions
Declining interest in investment houses and individual fund propositions
Need for a deep relationship with top companies
Focus on brand and category expertise – Indirect relationship
Business model impact Solutions buyer
Component buyer
Segmented service
Decision maker
Decision maker and influencer
Continuing interest in investment houses and their propositions
Continuing interest in investment houses and Declining their propositions
Need for a deep relationship with top companies
Need for a deep relationship with top companies
Influencer
interest in investment houses and individual fund propositions Focus on brand and category expertise – Indirect relationship
Business model impact Component buyer Decision maker
Continuing interest in investment houses and their propositions Need for a deep relationship with top companies
Segmented service Decision maker and influencer Continuing interest in investment houses and their propositions Need for a deep relationship with top companies
Solutions buyer Influencer
Declining interest in investment houses and individual fund propositions Focus on brand and category expertise – Indirect relationship
Business model impact Component buyer
Segmented service
Solutions buyer
Decision maker
Decision maker and influencer
Influencer
Continuing interest in investment houses and their propositions
Continuing interest in investment houses and their propositions
Declining interest in investment houses and individual fund propositions
Need for a deep relationship with top companies
Need for a deep relationship with top companies
Focus on brand and category expertise – Indirect relationship
BRAND, REPUTATION AND CATEGORY EXPERTISE RELEVANT TO ALL
More distant relationship developing between some advisers and investment houses
rp et ua Ne M il W l & oo G df o Ju rd pi te Di Fid r m eli en ty sio In nal He vest nd ec e Ab rso er n de Sk en a Bl ndi ac a k Sc roc St hro k an d da ers rd Ne Life pt u Ar ne te m L Th ion is re tr ad us n t JP eed M le or ga n
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Spontaneous mentions of Investment Houses Spontaneous men,ons of Investment Houses
12%
10%
8%
6%
4%
2%
0%
M o Pe & G rp et ua Fid l el it Ju y pi t In er v He este nd c er Sc son hr od e Ne rs w Ab ton er d Fir een st St a Ne te p JP tun e Th Mo re rga ad n ne e Lio dle nt ru Sk st an di a Av iva AX A sc
ve
In
Total mentions 40%
35%
%
30%
25%
20%
15%
10%
5%
0%
Which campaigns stand out? • Move away from component investment advice makes product advertising and PR less relevant • Most have problems recalling campaigns, even when prompted However... • Strong campaigns with distinctive identity the exception • Agreement that brands are most important to them and their clients
Which campaigns stand out?
Henderson
Schroders
How do they like to receive propositions? • Email favoured by majority • Subject line is key, • Accessibility of content • Knowledge based communications favoured • Products propositions need a strong and relevant story
• Need to build a dialogue
Stepping stones Marketing Communications Sales
Attraction
Engagement
Dialogue
Investment
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Frequency of visits to investment house websites 35%
30%
25%
20%
15%
10%
5%
0%
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Reasons for visits
80% 70% 60% 50% 40% 30% 20% 10% 0%
et Fid ual el it M y & Ju G pi I n St v ter an es da te c JP rd L M ife Sc org hr an Ab ode e r He rde s nd en er Ne son w Ne to Le pt n gg un M e as Ot on he rs
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Which websites? 80%
70%
60%
50%
40%
30% Visited
20% Most useful
10%
0%
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Reason to attend seminars %
90% 80% 70% 60% 50% 40% 30% 20% 10% 0% %
Most useful publications 0-‐10 6.2 6.0 5.8 5.6 5.4
0-‐10
5.2 5.0 4.8
Financial Adviser
Money Marke9ng
On or off line versions
Investment New Model Investment Week Adviser Adviser
Most useful on line sources Score 0-‐10 8.0 7.0 6.0 5.0 4.0
0-‐10
3.0 2.0 1.0 0.0
City Wire
Fundweb
Trustnet
Morningstar
Eq u e pr in t
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in osM e an t o ly st d prly pr in pr in t pin t ubt p bu licub t s aClic om onati So le e os, obns ly nl ut pr in in e t p ub lic aC Un on su s re / do n’ t k no w
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Readership in 2 years time %
70% 60% 50% 40% 30% 20% 10% 0% %
Conclusions Continuing sense of embattlement and need for support and ideas
RDR is having a major impact on the way IFAs relate to Investment Houses therefore...
The importance of brand and reputation is growing
Quality of data and segmentation will become increasingly important, and...
Conclusions Continuing sense of embattlement and need for support and ideas
RDR is having a major impact on the way IFAs relate to Investment Houses therefore...
The importance of brand and reputation is growing
Quality of data and segmentation will become increasingly important, and...
Conclusions Continuing sense of embattlement and need for support and ideas
RDR is having a major impact on the way IFAs relate to Investment Houses therefore...
The importance of brand and reputation is growing
Quality of data and segmentation will become increasingly important, and...
Conclusions Continuing sense of embattlement and need for support and ideas
RDR is having a major impact on the way IFAs relate to Investment Houses therefore...
The importance of brand and reputation is growing
Quality of data and segmentation will become increasingly important, and...
Conclusions Increasing need to communicate knowledge and expertise rather than just products
Shift from off to on line channels accelerating
Increasing need for a B2C presence
Important to use different channels and disciplines to build a dialogue
Conclusions Increasing need to communicate knowledge and expertise rather than just products
Shift from off to on line channels accelerating
Increasing need for a B2C presence
Important to use different channels and disciplines to build a dialogue
Conclusions Increasing need to communicate knowledge and expertise rather than just products
Shift from off to on line channels accelerating
Increasing need for a B2C presence
Important to use different channels and disciplines to build a dialogue
Conclusions Increasing need to communicate knowledge and expertise rather than just products
Shift from off to on line channels accelerating
Increasing need for a B2C presence
Important to use different channels and disciplines to build a dialogue
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