Going Beyond Traditional Advisor Segments to Increase Marketing ROI

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All Cogent Advisor Segments

Asset managers are collecting more data on financial advisors than ever but often struggle to transform their CRM systems into relevant and meaningful opportunities for advisor outreach and engagement. Undoubtedly, the competition for the attention and assets controlled by financial advisors (FAs) is intensifying, prompting many asset managers to seek better ways to target and communicate with advisors.

Data analytics and distribution teams spend about half of their time on data acquisition and data management, with just 14% of their time on more advanced analytics that fuel advisor segmentation and sales-lead generation, according to Applying Data to Distribution, a report by Ignites Research.* Perhaps more astonishingly, the report reveals that only one-third (39%) of asset managers incorporate advisors’ content preferences into advisors’ CRM systems, and one-fifth (11%) categorize financial advisors by types or “personas” that help determine their sales and marketing approach.

The current methods for segmenting the FA population for sales and marketing tend to be broad in nature and fail to take into account important differences in the attitudes, mind-set and preferences of FAs. Often, the desire to send more-targeted, customized communication is there, but firms fall short in their efforts to implement effective strategies given the additional time and money required to create their own proprietary models. Continue reading

Financial Advisors and Investors at Odds Over DOL Fiduciary Ruling

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The future of the DOL fiduciary ruling is anything but certain. We do know, however, that the majority of financial advisors have some concerns about the ruling, with six in ten advisors (60%) favoring repeal. Advisors employed in the broker/dealer channels—particularly the Bank channel (82%)—and commission-based advisors (72%) are most likely to support repeal. In contrast, RIAs, most of whom are predominantly fee-based and already consider themselves fiduciaries, are more likely to oppose repeal (45%) than support it (29%).

Advisors Weigh in on the DOL Fiduciary Rule

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ETF Growth Encompasses Multiple Markets

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It’s no secret that ETF use is up. In fact, a multitude of industry forces are fueling the growth in the ETF category, and the momentum is only poised to continue. Not only in one market, either. ETF use is reaching new levels among advisors, affluent investors, DC plan sponsors and both US and international institutional investors. While this is great news for top ETF providers, many smaller providers are nipping at their heels. The influx of growth will bring in new players and new challenges that providers will need to be aware of in order to survive and prosper.

In nearly all of our Cogent Wealth studies, we ask respondents about ETFs, which gives us a unique perspective on the category. We have gathered ETF-related findings from five of our most popular reports to provide a broader understanding as to why this category is experiencing such steady, and at times, extraordinary growth.

The following are the most important factors in what industry leaders will need to consider to continue to stay informed and be able to pivot when needed.

Focus on Fees

Across all sectors of the financial services industry, there is clear evidence of increasing pressure on product providers to reduce the fees associated with their investment offerings. In addition, the recent Department of Labor (DOL) fiduciary ruling is pressuring product providers and advisory firms to defend their fee structures and offer lower-cost options to clients whenever possible. Upon examining our data, it’s clear that this heightened focus on costs and fee transparency is strengthening the appeal of ETF products across all markets. Continue reading

LinkedIn Is Key to a Successful Social Media Strategy

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LinkedIn Key to Successful Social Media Strategy

Advisors and Affluent Investors Look to LinkedIn

Thirteen years after LinkedIn launched, twelve years after Facebook made its first friends and ten years after Twitter went live, social media is no longer viewed simply as an easy means of reaching and courting affluent investors and tech-savvy producers. Increasingly, asset managers and product providers are realizing they need to do more than merely set up a virtual storefront. That is, they need to develop a social media strategy, analyze connections and figure out how to work their followers effectively to stay top-of-mind. Recent findings from Cogent Reports™ highlight the critical role that LinkedIn plays for both financial advisors and affluent investors.


Among advisors, YouTube, LinkedIn and Facebook are the top three social media platforms most commonly used across all channels. That said, when we asked advisors to identify their primary platform for business and financial news and information, LinkedIn claims a commanding advantage at 60%, far above Twitter (16%) and Facebook (13%), with YouTube barely registering (4%). So for advisors, it is the quality of information they find on LinkedIn that differentiates this platform, not the quantity. Continue reading

RIAs Seeking Diverse Perspectives Online

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RIAs Seeking Diverse Perepectives Online

As competition to reach financial advisors intensifies, asset managers are increasingly augmenting sales and marketing outreach with paid advertising. Advertising is a key touchpoint when building brand awareness, the first stage in the advisor journey toward consideration and usage. However, advertising is expensive, and firms often feel they lack the information they need to make smart decisions. Cogent Media Consumption™ Advisor captures advisors’ ongoing use of and preferences for all types of media, giving asset managers and their agencies critical information to inform targeted media buying strategies.

Within the website category, the top media properties visited by advisors are relatively consistent across distribution channels. Yahoo! Finance is in a heated battle with Morningstar for the highest reach (55% and 53%, respectively), followed by Bloomberg (46%), The Wall Street Journal (42%) and CNBC (38%). However, we observe some distinct differences in advisor preferences and use by channel when moving further down the list. Continue reading

Advisor Enthusiasm for Smart Beta and Active ETFs Not Slowing

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Smart Beat and Active ETFs Not Slowing

As advisors’ ETF use surges and current users look for new ways to incorporate ETFs into their investment strategies, there is clearly an opportunity for traditional mutual fund managers and established ETF players to leverage this increasing market demand. To better pinpoint where this demand is coming from, Cogent Reports began tracking advisors’ current and anticipated use of specific types of ETFs in Q3 of this year. Specifically, we ask ETF producers how they expect their usage of ETFs to change over the next six months.

While the ETF category was founded on index-based products, interest now appears just as strong in other areas. During Q3 of 2015, nearly one-third (30%) of ETF users expressed a plan to increase their reliance on smart beta ETFs over the next six months, with non-users who are likely to start investing in the product contributing to this growth. Results are similar for active ETFs, with 28% of ETF producers anticipating they’ll increase their use of these products. Currently, 4 in 10 ETF users report using smart beta or active ETFs to some extent. Continue reading

How to Improve Marketing Reach Among Advisors

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Marketing Outreach

Emails, websites, social media, mobile apps, print, advertising, press—the list of tools marketers use to reach customers continues to evolve. In recent years, frequency was king, but that has changed. As people today continually wade through more and more email, it is harder for companies to stand out. To be successful, it’s increasing important for firms to understand who they are reaching out to and how their targets want to receive and use that information.

In this case, we are talking about financial advisors. Our newest report, Advisor Engagement™, finds that the volume of touches advisors report receiving continues to taper, revealing providers recognize the need to target and personalize their communication to key segments. This year, advisors say they receive an average of 106 touches per month, down significantly from the 126 touches reported in 2013. In particular, advisors report receiving fewer emails, print mailings and webinar invitations compared with two years ago.

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Advisor ETF Use Surges

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Advisor ETF Use SurgesReflecting advisors’ heightened fee sensitivity and increasing use of passive management, this year the proportion of advisors who report selling ETFs is at an all-time high. Three-quarters (76%) of advisors now report selling ETFs, a significant increase compared with 68% of advisors in 2014. This increase was driven by a significant uptick in use among both RIAs and Bank advisors. ETF adoption remains highest among RIAs and National wirehouse advisors, while RIAs are the only channel with a higher proportion of advisors selling ETFs (93%) than mutual funds (86%). In addition, average allocations to ETFs have risen 29% over the past year, from 11% to 14%.

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Shake-up in Brand Metrics that Drive Mutual Fund Consideration

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Advisor_Shake_UpsFollowing several years of improving impressions, this year mutual fund brand favorability ratings have plateaued. In fact, relatively few firms see changes in their scores, with the exception of two firms that suffered high-profile portfolio manager turnover, and the handful of providers that were well-positioned to benefit at the firms’ expense.

Following this turbulent period, there has been a significant shake-up in the branding elements that drive consideration. Trust is now the most important attribute for mutual fund managers to convey, followed by providing information that guides advisors’ investment decisions. Continue reading

Innovation: Ready or Not, Here It Comes

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AB_Blog_ImageThe market is strong, investors are confident, and short of a big, fat Greek economic disaster, it looks like smooth sailing ahead for financial advisors, right? Well, yes and no.

On the one hand, fewer investors are standing on the sidelines and there’s a lot more money in our economy available to invest, presumably with the help of an advisor. On the other hand, rapidly advancing technology, shifting marketplace dynamics and an array of new investment products are forcing advisors (and asset managers) to reevaluate their current business practices, and more fundamentally, to consider their relevance moving forward. Continue reading