For years, providers of managed accounts have been using various strategies to keep their names in front of advisors. Whether in the form of seminar hosting, visits from marketing reps or value-added business-building tools bearing the manager's name, most financial advisors are accustomed to receiving these kinds of benefits ancillary to the development of their practices.
Yet, partly due to recent scandals in the mutual fund industry, firms seem more determined than ever to get more attention-and business-from wealth managers. While the flap about advisor incentives, promotions or other offers is more prevalent among the fund crowd, separate account managers argue that it is still 'business as usual' with providing value-added support, one-on-one relationships, and strategic partnering and coaching.
The basics of value-added tools still exist; the level has just been "bumped up" a little. Presentations and seminars remain the cornerstone of firms' offerings to advisors, and with good reason. "It's really interesting," explains Ed Blodgett, director of private client services at Brandes Investment Partners. "Some advisors tell us that seminars no longer work, but that's not our experience. We're still hosting a number of seminars and attendance is at an all-time high, so there's clearly an interest, especially among high-net-worth advisors."
Blodgett, who oversees the development of broker-dealer and advisor relationships, summarized the thoughts of many management firms in saying that while seminars continue to be important, they are becoming more advanced and developed. Blodgett explains, "One of our formal presentations is called 'Becoming Highly Referable,' and it has techniques designed to improve referral strategies that are based on client understanding. An effective advisor has a defined investment process, but few clients understand it. Once a client understands the process and why it works, then the advisor is immediately able to increase referrals because that client will explain the process to their friends and associates."
"Best practices" is the advisors' hot dot, of course, and AIM Investments has incorporated various advisor best practices into their presentations. "We've created a series called Proven Business Strategies, which consists of mini-modules of strategic lessons and observations compiled from successful people in the financial business," explains Kamala C. Sachidanandan, senior vice president of marketing for the firm. "The lessons provide practical advice that advisors can implement right away, to help build their business."
The firm addresses topics such as "carving out a niche" and "duplicating best clients."
Increasingly, other factors, such as technology, are becoming a significant help to advisors looking to capture larger assets. To that end, money managers like Nuveen Investments are focusing on technology education in their presentations. Although the firm holds three-day workshops on stock option planning, corporate executive issues and other investment-related topics, the technology seminar seems more hands-on and popular with the advisor audience.
"It's not our goal to sell an advisor on a particular technology tool, but to teach how technology can make them more effective in their practices," offers John Nersesian, managing director of wealth management services for Nuveen. "For example, we train and teach advisors on Financeware and the benefits of Monte Carlo forecasting. We train how to generate these reports, and how to interpret and share the results."
James Seuffert, president of Lockwood, often takes the managed account industry to task for their advisor support shortcomings, but agrees that practical education is needed more than hypothetical theories and fuzzy concepts. "There's not enough point-of-sale training for these advisors," he says. "There's lots of products, but training is necessary. We've got to realize that managed accounts are much different than a mutual fund sale; we have to do more in teaching [independent] advisors how to go out and compete with Smith Barney or Merrill Lynch in this market."
Seuffert put his money where his mouth is by explaining the tone of his firm's popular Lockwood Universities. "The classes run from seven in the morning to nine at night, and there's no golf, no tennis, no schmoozing-none of that. Instead, we're teaching advisors how to explain SMAs to high-net-worth clients and how to position themselves as an independent advisor offering conflict-free advice versus what their competitors offer."