February 10, 2021
New data from Cogent Syndicated find virtual interactions with wholesalers are nearly as effective as traditional interactions, with the added benefit of increased accessibility. As a result of the pandemic, advisors’ communication preferences are changing. Wholesaler interactions are now taking place via phone and video conference with very few in-person interactions, leaving asset managers to question whether these types of virtual interactions are an effective strategy in the long term. These and other findings are from Cogent Syndicated’s Cogent BeatTM Advisor, a continuous data collection engine that allows real-time analyses of advisors’ evolving practices from Escalent, a top human behavior and analytics firm.
The vast majority of advisors report interacting with external wholesalers remotely via the phone (42%), email (40%) and videoconference (14%). Just 4% of advisors met with a wholesaler in-person in October and November 2020, with almost all of these advisors younger than 55. Advisors provided strong ratings for the impact of remote and virtual interactions. On an 11-point scale, average impact ratings are 7.4 for videoconference interactions and 7.6 for phone interactions, while ratings are weaker for emails directly from the wholesaler (6.7). Notably, wholesaler effectiveness ratings for remote and virtual interactions show little sign of deterioration compared with this time last year when in-person meetings with external wholesaler meetings were more of the norm.
“This is strong evidence for a continued shift toward hybrid distribution models,” said Meredith Lloyd Rice, vice president at Escalent. “Certainly, these types of remote interactions can present some challenges in developing deep, personal connections and may not be the right fit all of the time. However, many advisors appreciate the accessibility of virtual meetings.”
Advisors are also increasing their reliance on digital tools beyond wholesaler interactions. In addition to email, provider webinars and websites are now frequently cited as preferred ways to engage with providers. Preference for social media and provider apps is relatively higher among younger advisors. Signaling that demand for digital engagement is here to stay, three in ten advisors plan to have fewer in-person interactions even after the pandemic is over.
“The pandemic is accelerating changes that were already under way in the advisor market and we expect many of these shifts will have long-term staying power,” continued Rice. “Adjusting outreach strategies and optimizing service models now to meet changing advisor expectations as well as the needs of younger advisors gives firms an opportunity to ensure relevancy for years to come.”
Communication Method Used with External Wholesalers
| Phone | 42% |
| Email directly from wholesaler | 40% |
| Videoconference | 14% |
| In-person meeting | 4% |
Mean Impact of External Wholesaler Interactions
| Overall | Videoconference | Phone | |
| October/November 2020 | 7.2 | 7.4 | 7.6 |
| October/November 2019 | 7.5 | N/A | N/A |
Base: All advisors using mutual funds
Source: Escalent. Cogent Syndicated™. Cogent BeatTM Advisor. October to November 2020.
About Cogent Beat™ Advisor
Cogent Syndicated conducts an online survey with approximately 400 registered financial advisors each month, with the most recent data from the combined months of October and November 2020. In order to qualify, respondents were required to have an active book of business of at least $5 million and offer investment advice or planning services to individual investors on a fee or transactional basis. Escalent sets quota targets and weights the data to be representative of the overall advisor universe using the Discovery Data Financial Services Industry database as a sample source. Escalent will supply the exact wording of any survey question upon request.
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