Finding the Right Fit

July 10, 2019

After marking the anniversary of a ten-year bull market in March, few are celebrating. Rising international tensions, tariffs, market volatility, and an upcoming presidential election are feeding into investor uncertainty and leading many to wonder when this historic run will end.

Compounding these worries, small to mid-sized asset managers face unprecedented challenges. Advisors report working with fewer providers, benefiting the best-known firms with the highest market penetration and scale to compete on price. Armed with a full range of investment offerings, larger firms have the opportunity to focus less on product and more on advice that achieves desired outcomes. Furthermore, larger firms are more likely to have the resources available to make capital investments in data and technology to better serve advisors and their clients. Indeed, in this year’s Advisor Brandscape study, industry giants American Funds, Vanguard and BlackRock appear stronger than ever.

Despite these headwinds, opportunities remain for firms willing to take the initiative. Relatively smaller players have an opportunity to step up in delivering authoritative insights that offer a distinct point of view and build on areas of perceived expertise. Mid-sized managers able to find a complementary partner can scale up quickly through M&A activity. Notably, the size of the $5 billion-plus Invesco-Oppenheimer deal could be a harbinger of things to come.

Taking a longer view, one wonders where potential acquisition activity could lead and whether tech giants such as Amazon, Apple and Facebook could enter the market and bring a new era of disruption. Investment providers that take the time now to assess where they fit in this changing landscape and what gaps they need to fill to effectively compete will be best positioned to thrive.

 

With Advisor Brandscape, you get a holistic view of the advisor landscape including practice models, product usage, brand perceptions and user experience, and is the leading industry benchmark for the nation’s top mutual fund and ETF providers. Click below to learn more.

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Meredith Lloyd Rice
Vice President, Cogent Syndicated

Meredith Lloyd Rice is a vice president in Escalent's Cogent Syndicated division. She manages the firm’s syndicated research products focused on the financial advisor market and is the lead author of the Advisor Brandscape® report. She has more than 15 years of experience managing research initiatives in the wealth management industry and has explored a wide range of business issues on the client and supplier side. Prior to joining Escalent, Meredith was an associate VP at Chatham Partners where she oversaw a team of researchers and managed the overall design, analysis and interpretation of large-scale studies for institutional financial services clients. Meredith earned an MBA from Thunderbird School of Global Management and a bachelor’s degree from Colgate University. She is a former collegiate rower who now gets her exercise chasing after her daughter and Clumber Spaniel.