Last updated: 22:47 / Tuesday, 2 August 2016
Cerulli Associates

Key Accounts and Wholesaling Teams Will Support Fewer, Larger Distribution Partners

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Key Accounts and Wholesaling Teams Will Support Fewer, Larger Distribution Partners
  • To what degree do centralized research teams at home offices influence investment decisions, as opposed to decentralized decisions made by financial advisors and, in some instances, their teams?
  • The firm believes that the dueling influences of centralized home-office research teams and decentralized advisor investment decisions will have significant ramifications for asset management distribution teams in coming years

New research from Cerulli Associates explores the evolution of wholesaler and key accounts roles in response to the influence of professional buyers at centralized home-office research teams in the United States.

"Asset managers are on a continuous hunt to identify the most effective factors impacting a financial advisor's product decisions," states Kenton Shirk, associate director at Cerulli. "As the industry evolves, managers face a key question: to what degree do centralized research teams at home offices influence investment decisions, as opposed to decentralized decisions made by financial advisors and, in some instances, their teams?"

"The challenge lies in discerning the extent to which various parties--the home-office research team versus other influencers within a practice, such as investment analysts or chief investment officers (CIOs)--shape a given advisor's product decision," Shirk continues. "As a result of these shifting points of influence, key accounts and wholesaling teams are wading through increasingly murky waters, and their structures and strategies are changing in response."

The firm believes that the dueling influences of centralized home-office research teams and decentralized advisor investment decisions will have significant ramifications for asset management distribution teams in coming years. With a large and diverse field of advisors, asset managers of scale will need to address both home-office research teams and individual advisor relationships. Asset managers need to cater to large advisor teams with centralized portfolio management and institutional-like buying processes. In addition, they need to address distribution partners to ensure that they maximize their influence with advisors who rely on recommended lists.

"Cerulli believes that key accounts teams will support fewer, larger distribution partners. Key accounts teams will grow in importance and asset managers will continue increasing the quantity and quality of their teams and resources," Shirk explains. "The role of wholesalers will also continue to evolve. Advisors who rely heavily on home offices can still be influenced by wholesalers who can provide information to help an advisor make a final decision. But wholesalers need to pinpoint these subtle influence points quickly. Identifying these high-impact opportunities will likely be a major objective of predictive analytics initiatives as they continue to evolve."

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