riia vlc webinar: four strategies to win the hearts and ... · riia vlc webinar: four strategies to...

RIIA VLC Webinar: Four Strategies to Win the Hearts and Minds of Your Advisor Channel — and Grow Share

Presented by David Ehrenthal, Investments & Retirement Practice Leader

EMI Strategic Marketing

With special guest Dana Anspach, CFP, RMA

November 20, 2013

May 22, 2013 www.emiboston.com

Who We Are


Poll:

What is your biggest barrier to growing advisor channel share?

1. Awareness of my brand and products is too low

2. My value proposition is not resonating with target advisors

3. Needs of my advisor channels are changing; it’s hard to adapt

4. Our sellers are not consultative

5. We don’t know which advisor segments to target


Key Foundations for Formulating Strategy

Product Providers Product Providers

Growing dependence on

3rd party channels



Advisors

Product Providers

Advisors

Gradual shift in business model,

required competencies, and

channel asset share


Households/Assets


Advisors

Product Providers

Households/Assets

Boomers streaming into retirement,

concerned about longevity risk

Dramatic growth in retirement assets


Advisors

Product Providers Households/Assets

Economy


Economy

Low interest rates,

sub-potential economic growth,

persistent global economic

imbalances


Technology

Advisors

Product Providers Households/Assets


Economy

Technology

Great advances in web-delivered

DIY financial planning, practice

management tools, mobility


Poll:

What is your biggest barrier to growing advisor channel share?

1. Awareness of my brand and products is too low

2. My value proposition is not resonating with target advisors

3. Needs of my advisor channels are changing; it’s hard to adapt

4. Our sellers are not consultative

5. We don’t know which advisor segments to target


Increasing dependence on 3rd party channels

Source: 2003 Mutual Fund Book, Investment Company Institute, 2012 Investment Company Fact Book; Perspective (7/2003);

ICI Research Report Profile of Mutual Fund Shareholders; ICI Research Perspective (2/2013); Beacon Research

2002

2011

63% 68%

Variable Annuities

74%

86%

Fixed Annuities

83% 87%

Mutual Funds


Asset shares shifting between retail advisor channels

Wirehouse

Broker Dealer*

Dually Registered &

Independent RIAs

Source: Registered Representative, Cerulli Associates, Access Data & Strategic Insight

49%

34%

17%

2007

34%

41%

25%

2014P 2010

43%

38%

19%

2012

39%

39%

22%

Asset Shift Alert:

Q1 2013 RIA (9%) and IBD (6.5%) mutual fund asset growth outpaced wirehouse (6.0%)

* Includes independent, regional, bank, insurance


69%

Households net worth highly skewed toward 55+

25%

50%

75%

100%

<35

4%

35 – 44

9%

45 – 54

18%

55 – 64

26%

65 – 74

29%

75+

14%

Source: Federal Reserve Bulletin (6/2012)

Age of Head of Household

Net

Wo

rth

(%

of

Tota

l)

0%


Households are saving for retirement and emergencies

Source: Federal Reserve Board, Survey of Consumer Finances; 2012 Household Financial Planning Survey,

Consumer Federation of America (7/2012)

97% of households

with $100k income

are saving for

future retirement

“The primary reason why I save”

11%

33%

30%

1%

Other

Investments

Education

Purchases

Liquidity

Retirement

15%

8%

18%

34%

13%

8%

8%

10%

1989

2010


Households are allocating more assets to retirement goals

1983 1998 2010

Transaction Accounts 15% 11% 13%

CD 16% 4% 4%

Bonds 39% 4% 5%

Stocks 6% 23% 14%

Mutual Funds NA 12% 15%

Retirement Accounts 6% 28% 38%

Cash Value – Life Insurance NA 6% 2%

Other 18% 11% 10%

Source: Survey of Financial Characteristics of Consumers, Federal Reserve Bulletin (3/1984); Survey of Consumer Finances,

1983, Federal Reserve Bulletin (9/1984); Federal Reserve Bulletin, Recent Changes in US Family Finances (2006)


Financial advisor evolution mirroring the household’s

Transactional Household

For 4 in 10 advisors, retirement planning constitutes half or more of their business activities

(LIMRA’s “Advisor Perspectives on Retirement Planning”, 2012)

Primary

Persona

Value

Prop

Business

Model

1990 1980 2000 2010 Future

Stock

Broker

• Stock Picker

• Muni Sales

• Commissions

Investment

Advisor

• Manager Picker

• Commissions

• AUM fee

Financial

Planner

• Asset Allocation

• Budgeting

• Commissions

• AUM fee

• Hourly Fees

Lifetime/Retirement

Income Manager

• Accumulation

• Transition

• Decumulation

Professional

Service Fees?


GDP, 10-Year T-Note, 1955 – 2012

Low interest rates, slow growth, limited visibility

Source: Bureau of Labor Statistics; Team analysis

0%

2%

4%

6%

8%

10%

12%

14%

1955 1960 1965 1970 1975 1980 1985 1990 2010 2012

GDP Growth - 5YMA

10-Year Treasury

1995 2005 2000


Technology enabling remote and more efficient delivery

Wealthfront Jemstep



Growth increasingly dependent on 3rd party advisor channels

Distribution opportunities shifting toward independent and dually

registered RIAs

Financial assets increasingly held by transition and retiree

households, many of whom are struggling with cash flow

Challenging economic environment in the foreseeable future

Technology disrupting conventional models


The Product Provider’s Riddle

650+ Mutual Funds sponsors

40+Annuity providers

37+ETF sponsors

Breaking Through Is a Challenge Because…

Advisors manage an average of 14 product provider relationships

and receive 1200+ “touches” per year

81% work with 4 mutual fund providers or less

87% work with 2 ETF providers or less

1 in 3 are likely to reduce number of product provider relationships

How do you grow advisor mind and market share

in the context of massive change and a very crowded market?


Solving the Riddle: 4 Strategies for Growing Share

Be the best at:

Wholesaler –

Advisor Interaction

1) Knowing & understanding each advisor’s practice

2) Making relationships more personal & effective

3) Driving sustained advisor engagement

4) Supporting the advisor-client relationship

Direct-to-Advisor

Relationship Marketing

Corporate

Brand Advertising


Poll:

If your advisor channel only says one thing about you, what should it be?

1. Sends me great research and commentary

2. Is the best at supporting my client relationships

3. Shares great ideas I can use with my clients

4. Spends time to get to know me and my practice

5. Offers great products


What Dana Values Most

Consultative approach, not trying to sell me something

Product expertise and the ability to map products

to my practice/the needs of my clients

A value proposition that includes

Saving me time and making my practice more efficient

Adding value to my client relationships

Something that really distinguishes them, for example:

Great research

Insightful, practical commentary

Best product in the market


What a 2007 Survey Says

What do advisors value most in a wholesaler?

1. Takes a solution-oriented approach to me and my clients

rather than pushing product

2. Understands how I do business

3. Offers ideas based on what’s working for other advisors

4. Offers ideas on how to market business more effectively

5. Offers ideas on how to run practice more efficiently and productively

Note: Product was listed 6th

Source: Horsemouth/FRC Wholesaler Effectiveness Survey (2/2007)


Poll:

If your advisor channel only says one thing about you, it should be…

1. Sends me great research and commentary

2. Is the best at supporting my client relationships

and helping me find new clients

3. Shares great ideas I can use with my clients

4. Spends time to get to know me and my practice

5. Offers great products


Use my product, please

Be the best at knowing & understanding your advisors’ practice

Greet Present Respond Convince Depart

Strategy #1 Strategy #2 Strategy #3 Strategy #4

Old school…



Listen Collect Synthesize Connect Solve

• About the

advisor

• About the

practice

• Tablet

• Desktop

• Attitude

• Preferences

• Priorities

• Map to:

- You

- Your brand

- Your products

• Demonstrate

you listened

• Present your

products, and

where they fit in Here’s how I can help


Best practice…


Be the best at making personal connections with target advisors

“Advisors work with wholesalers they are comfortable with”

Two keys to achieving this state…

Self-disclosure: the hallmark

of a strong relationship

Not manipulative, framed as

furthering the relationship

Relevant information about

the wholesaler

Readiness to work together

To achieve advisors’ goals

Understanding that

this comes before the

wholesalers’ objectives




Yesterday

Business card

Brochure

Corporate web site

Tactical execution example:




Personal Digital Profile (gateway to corporate site)


Today & the Future

Personal brochure

Social presence


Be the best at engaging target advisors

Effectively harness Intermediary Relationship Marketing to create distribution platform leverage:

Value Proposition

Messaging

Segmentation

Precise, consistent value proposition to your advisors

Advisor channel segmentation to ensure profitability

content relevance, and prioritize activities

Messaging: narrative, anchored in value proposition

and shaped by segmentation

Dynamic intelligence accumulation and synthesis


Accumulation/

Synthesis


Be the best at engaging target advisors

Examples of IRM

Paid Search

Defining

Preferences

Commentary



Be the best at supporting advisors in building client relationships

Low level of financial literacy

Anxiety over personal finance topics

“Are you anxious about having enough

money in retirement?”

Those within ages 45 – 65 responding

“somewhat” or “very anxious”

All >$200k

in savings

56% 44%

Source: 2013 Survey of Financial Decisions among Washington State Residents AARP



Be the best at supporting advisors in building client relationships

Today’s Necessity

Chief investor

concern

Tangible,

entertaining

content to

frame concept Real life stories investors

can relate to

Investor name

Yesterday’s Convention



Reprise: The Four Success Strategies

Be the best at:

Knowing & understanding each advisor’s practice

Making relationships more personal & effective

Driving sustained advisor engagement

Supporting the advisor-client relationship


Four Strategies to Grow Share with Your Advisor Channels

Questions,

Discussion

Contact Information

David Ehrenthal EMI Strategic Marketing

[email protected]

617-226-4352

Linkedin.com/in/davidehrenthal

@EMI_mktg4retire

Dana Anspach Sensible Money, LLC

7051 East Fifth Avenue Suite F

Scottsdale, AZ 85251

[email protected]

480-719-7290

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