Posted June 15, 2017 by Erjon Gjoci
Wirehouse and RIA channels combined make 33% of advisor population but control more than half of market assets. While traditionally asset management organizations have dealt with and targeted these channels as isolated entities, our data shows that advisor needs and expectations from asset managers have more similarities across channels than within. These similarities increase the need for asset management firms to upgrade their advisor territorial coverage beyond the traditional channel-based methods.
In March 2017, we conducted our Advisor Insights survey, in partnership with Horsesmouth, on the topic “Getting Value from Asset Managers.” One of the questions we asked 410 advisors was:
How can sales teams provide more value to you and your practice? (The question had an open-ended field for advisors to write their responses.)
The results show that nearly 50% of advisors gather “business development and practice management ideas” from asset management wholesalers. These results are consistent for both RIAs and wirehouse advisors. Results for “Client acquisition and retention” are also around 50% for both RIAs and wirehouse advisors. These results include overlapping advisors in both channels, which when calculated separately would add another 10%.
The following graphic shows aggregate responses of the combined Wirehouse Advisors and RIA population.
While there are some differences in advisor expectations between the two channels, when we next layer in the advisors that requested “market-updates-and-insights” we cover nearly 90% of total advisors in both channels.
Another important factor for asset management firms to keep in mind is that about 5% of advisors in both channels said they were interested in new product sales.
In conclusion, our survey and analysis found that similarities among advisors within the same ZIP Codes are stronger than those advisors within the same channel. Asset managers who are segmenting advisors by RIAs and wirehouse advisors may be draining their sales resources to cover advisors by channels when in fact sales teams can more efficiently focus on advisors with similar preferences and need. By looking at advisor expectations across both of these major channels, firms can engage a broader audience and optimize their outcomes.
Contact us to find out more about advisors in wirehouses, RIAs, other channels and/or advisor insights research
categories: advisor segmentation, advisor behaviors, advisor preferences, ria/rias
The views expressed in this publication are solely those of the author and do not necessarily reflect the position or policy of DST Systems, Inc. or its affiliates, subsidiaries, joint ventures, officers, directors, or management.