July 30, 2024
Product offerings and value for the money play more of a supporting role in the consideration decision according to the latest Advisor Brandscape® report from Cogent Syndicated
As financial advisors adapt to meet the complex needs of their clients and build stronger relationships, they are focusing more of their time on client engagement and comprehensive financial planning, and less on portfolio construction and investment selection. This underscores the critical role of trust and guidance from asset managers as the primary factor influencing consideration among advisors. This is according to the latest findings of the Cogent Syndicated Advisor Brandscape® report by Escalent, an annual study that measures the impact of brand and loyalty on revenue in the advisor marketplace.
“Asset managers have traditionally been focused on marketing investment products, but they must now realize that product-related marketing takes a back seat to broader relationship-oriented themes in driving consideration,” said Meredith Lloyd Rice, vice president in Escalent’s Cogent Syndicated division.
While still important, range and quality of product offerings and value have a more indirect path to consideration. “Firms can deliver value by providing access to tools, research, and insights that help advisors create portfolios tailored to their clients’ specific needs,” continues Rice. “This highlights an opportunity for firms of all sizes to strategically message these capabilities to capture market share.”
“As advisors take a holistic approach to clients’ financial situations, including family and legacy planning, the complexity of clients’ needs and available investment options has increased,” explains Rice. “Financial advisors must justify their fees by offering value beyond stock selection, focusing on building robust relationships with clients and considering the needs of younger generations and future wealth transfer. Asset managers with strong engagement and trust are better positioned to succeed in this evolving landscape.”
Advisors who serve more affluent clients report an even higher proportion of clients planning for generational wealth transfer compared to those serving less affluent clients (64% vs. 45% on average). In addition, more than half of advisors indicate having met with their clients’ adult children at least occasionally, pointing to a need for an expanding array of client educational materials. Cogent Syndicated will also be exploring this topic in depth with affluent investors in its upcoming Trajectory of Intergenerational Wealth Transfer study.
About Advisor Brandscape®
Cogent Syndicated conducted an online survey with 1,483 registered financial advisors from January to March of 2024. 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. Cogent 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.
For more information about the full report, click below.
