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Amid Rising Sales, Advisors Cite Guaranteed Retirement Income as Top Reason for Selling Annuity Products
Annuity sales are rebounding and advisors expect to maintain, or even increase, their use of annuity products in the near future. At the same time, the composition of advisors is changing, as many advisors shift further toward fee-based compensation models. Annuity providers have an opportunity to support advisors using a variety of compensation models through this transition while highlighting the important benefits annuity products can bring to advisors and their clients.
When asked how important a list of factors was as reasons for selling annuities to clients, advisors cite the ability to generate guaranteed income in retirement as the top factor. In fact, over three-quarters (76%) of advisors, regardless of compensation type, cite this factor as very important. Diving into different types of annuities reveals that retirement income products and guaranteed rates are also among the leading consideration drivers for variable and fixed annuities, respectively. Continue reading
Lessons from the Consumer Packaged Goods Industry
The telecom industry has always been innovative, but the innovation has been mostly incremental. Over the past century, we had telegraphs, then wired telephones, then wireless phones, then cell phones, and now we have smartphones. Up until the smartphone, the iterations were not fully reimagined products, just significant improvements on the existing products of the era. Today, we have high-speed internet and smartphones that put most of our communication and entertainment literally at our fingertips. Never has the telecom industry had to reinvent itself to the extent that it does today.
Telecom companies are now essentially media companies, not phone and internet companies. To accommodate all of these changes and to rapidly adapt, telecoms are engaging in an unprecedented number of mergers and acquisitions. A combination of these factors means telecoms need to constantly rethink their products and positioning. They also have to build and market new products—and they have to do it quickly. Continue reading
Virtual Reality Is More Than Fun and Games
Over the past four years, a flurry of product introductions has created significant buzz around the area of virtual reality (VR), and much of the hype is well deserved. Users confirm that VR offers an incredibly immersive experience. In practical terms, this means that VR users feel swept away from their actual, physical environment and transported into an entirely separate virtual environment that fully engages their senses of sight and sound. Fighting off robots in the land of Robo Recall when one is actually standing in one’s living room is both thrilling, fun and magical. However, academic research indicates that the benefits of virtual reality go far beyond offering a novel experience for gamers. Continue reading
Editor’s Note: If you’re attending the 2018 Corporate Researchers Conference, please join Gwen Ishmael and Paul Ponsford of Delta Faucet Company for “#TomBradyFail—An Innovation Lesson from the New England Patriots” on Wednesday, October 10. Their talk will dive deep into this blog topic of how different consumer types can support (or inhibit) innovation. Contact us for a registration discount code.
As noted in Forging a Clear PATH to Corporate Innovation, it is critical to involve the right types of consumers at the right points along the Innovation Journey. Instead of simply focusing on your Target Consumer, it is important to recognize how other types of consumers—Lead Users, Creatives, Early Adopters and Brand Advocates—can contribute to and strengthen the innovation process.
These different consumer research groups form naturally around shared traits and preferences, the exact kind of commonalities that can spell gold for marketers—and market researchers. But the keys to tapping into their potential lie in understanding and identifying members of each group and knowing when exactly in the Innovation Journey they can contribute most.
Consistency sounds boring. We’re going to have chicken and broccoli for dinner again. I ran my 30 minutes on the treadmill again. Consistency doesn’t lead you to discover the perfect town when you’ve made a wrong turn or meet the band when you’ve stayed well past the encore at a random weekday concert. But consistency can be powerful. Continue reading
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Despite new challenges in the financial services landscape, changing market dynamics offer new opportunities for those willing to adapt.
The economy is strong, with record low unemployment and robust market performance. Furthermore, the Dow topped 26,000 for the first time in January. However, rising trade tensions, divisiveness and political uncertainty are causing many investors to question when the bottom will fall out. For active managers, many of which lost share to index funds during this period of stability, the question arises, could there be a silver lining?
At first glance, the competitive environment appears inhospitable to firms lacking the scale to compete on price. Vanguard and iShares have amassed record inflows over the past year, pressuring competitors to lower their expense ratios. We’ve also seen increased M&A activity among mid-sized managers seeking global scale and broader distribution for their products as broker-dealers constrict the number of managers on their platforms. Continue reading
New products and technologies are changing how customers interact with their energy provider and have opened up opportunities to offer additional products and services designed to drive engagement, trust and revenue. The utility of the future will need to engage with customers through value-added products and services that go beyond simply providing reliable service, but how do utilities pivot from operating as a regulated monopoly to becoming innovative and inspired product marketers in a competitive landscape?
The good news for utilities is that they have abundant resources and capital to support new-product development. The challenge, however, is that they are accustomed to putting those resources to use within a very structured, regulated environment that is not well-suited to the free-thinking and “willingness to fail” ethos often required to successfully generate ideas and turn those ideas into new products and services. Simply put, innovation as well as product or service development requires a culture and skill set that many utilities lack.
Utilities should keep in mind three principles as they work to evolve into innovators and product marketers.
Addressing Hidden Needs in a Mature Insurance Marketplace
A recent TechCrunch article spotlights Lemonade, an insurance upstart that is boldly reimagining the customer experience. The young firm has already made waves with its use of cloud technology and artificial intelligence to sell insurance, and now it is going a step further by crowdsourcing a full rewrite of its insurance policy from scratch, with the goal of devising documents that consumers can actually understand.
Lemonade has correctly identified a critical pain point for insurance consumers—the underlying product is begging for innovation. Traditional policy documents are inscrutable and full of legalese and were never written with customers in mind. The policy is a great place to start the insurance product revolution, but does Lemonade go far enough?
With the Electronic Entertainment Expo (E3) coming up in a few days, the gaming community is eagerly anticipating what companies have in store. This year, many eyes will be on Microsoft, who has been secretive on what it plans to reveal. Their shift from the E3 show floor to the Microsoft Theatre at LA Live, just across the LA Convention Center, has heightened the intrigue.
Many people in the gaming community are hopeful that Microsoft’s move to its own space is a sign that the company has big things to share during its E3 press conference. Reading through pre-E3 online commentary, we find a community seeking a refresh of the Xbox brand, which seems to be falling behind in the current generation of game consoles. Reception for its latest console, Xbox One X, is tepid, even if it has the most powerful technical specifications.
So far, Sony’s PS4 has outsold Xbox One two-to-one.
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Environmental, social and governance (ESG) investing is continuing to impact the wealth management space. As individual investors become increasingly concerned with the ethics and environmental impact of the companies they are supporting, they are passing that concern on to the institutions that manage their investments. In fact, ProxyPulse*, a report by Broadridge and PwC, found a growing momentum of ESG proposals in proxy meetings in 2017. Following the US withdrawal from the Paris Climate Accord, the report also suggests an expected increase in questions from shareholders on environmental impact and climate change in 2018.
To keep a pulse on the growth in the ESG category, Cogent tracks interest in and usage of ESG investing among all the audiences we survey: financial advisors, DC plan sponsors, affluent investors and institutional investors. Specifically in the institutional market, we added a new question to this year’s US Institutional Investor Brandscape report, fielded late in 2017 and publishing this month. We asked institutional investors in the US how likely they were to adopt ESG investing in the next 12 months. We found that, while few institutions have already incorporated ESG in their portfolios, usage is considerably higher in the non-profit sector, where the approach to investing tends to be more mission-based than is typical among pensions. Continue reading