There remains an important role for the mutual fund wholesaler, but things have changed.
Across industries, there are a lot of articles that suggest sales is dead. The argument is that web provides a content rich platform for buyers to “self-sell” and there is no longer a need for a salesperson to drive awareness, shape and develop needs and craft tailored solutions. Some studies found that 70-80+% of a decision is made on the web and through trusted networks before a person ever engages a sales person. The sales rep’s role is reduced to order taking at the end of a self-sell cycle.
Our research with financial advisors – including independents, RIAs and wirehouses – tells a different story about the mutual fund wholesaler. We would argue that while these digital impacts are real and impacting the sales cycle, there remains a critical role for the right kind of consultative mutual fund wholesaler and leading asset management firms are paving the way.
Don’t be that ‘guy’
Is this familiar? The FA team at the wirehouse or advisor firm sees the familiar face of the ‘persistent wholesaler’ coming down the hall and they close their doors. They are busy and not interested in hearing another product pitch. But, what if it was different? What if the brand perception of the firm and the wholesaler were more compelling and the wholesaler was looked upon as a valued resource?
A new architecture for asset management sales and marketing
With the proliferation of web content has created a ‘content shock’ where ‘expert’ content is available instantly from a Google search. Yet, to navigate all of this information, financial advisors still value trusted expertise, solution recommendations, value-added programs and consultative insights. Advisors want wholesaler to bring insights about what other advisors are doing and tailored product strategies that fit their model portfolios. They know that they can’t get this online.
To make it all work, leading asset management firms are connecting marketing and sales with a ‘revenue marketing’ approach where teams align around revenue targets and work together across a single sales and marketing architecture and process. The life of the relationship is managed transparently from initial brand awareness to active client expansion. Within this more modern and integrated environment, wholesalers bring expertise and insight along with their ‘sales DNA’ driving active and effective 1:1 engagement.
‘Products’ sell themselves, portfolio strategy needs more work.
A specific mutual fund product can sell itself with available performance and risk data, management profiles and style boxes. Morningstar will identify specific fund solutions that fit with their models and gaps. Yet, with increased product variation and complexity and the need for durable portfolio construction, there is greater nuance in these selections. A good Wholesaler is consultative, and adds value. Some of the attributes include:
Organize and focus around the target the market. Effective wholesalers understand their territory and are intelligent and organized around their target segments. They know which advisors and teams to engage with and they are prepared before they begin the conversation. They understand influencers and drivers of asset decision-making.
Maintain a high level of active [professional] engagement. While it is very difficult to break through and gain the attention of an advisor, the successful wholesaler will avoid the cardinal sins of sales and will maintain an optimal engagement level. Consistent contact with advisors and relationships and related touchpoints keep the wholesaler top-of-mind. The key is to make these touchpoints valuable or relationship enhancing.
Bring deep product knowledge. While the web will self sell and, advisors still expect their wholesaler to bring expert product knowledge that included comparisons with competitive products. This is particularly true as product variation and alternatives introduce greater product complexities. Advisors understand that looking in the rear view mirror at past performance does not tell the whole story.
Build trusted personal relationships. Gone are the days when golf outings drive decisions, but relationships still matter. The best relationships are both personal and professional. They are strategic and value add. Successful Wholesalers will be willing to suggest the products in their product portfolios that may be less desirable for the particular advisor at a particular time. They bring highly valued insights about what strategies other advisors are pursuing. Advisors want to be kept up to date.
Establish an organized ‘account plan’ approach. While often thought of as the purview of the large enterprise sales team in B2B industries, the account is also important for Wholesaler teams, particularly for institutional clients, but also for independent advisors and RIAs. The plan can help define the parameters of the relationship and the underlying requirements of the advisor – whether in a wirehouse, Broker Dealer, Institution or RIA firm.
Bring tailored insights and recommendations. Successful wholesalers understand consultative portfolio management and are able to translate an advisor’s unique model and portfolio and recommend effective strategies and tactics.. Natixis is a great example of a leader in this space. Unlike product-focused sales teams from traditional wholesalers, Natixis Global Asset Management takes a more consultative approach to an advisor’s portfolio. This strategic insight often results in additional asset flow.
Communicate persuasively. With the insights in hand, the more successful wholesaler will have the skills to communicate persuasively and effectively. A proven approach uses a top-down ‘SCQA’ model – articulating the situation and complications or key challenges, then presenting a clear and logical answer to the critical question the advisor is trying to address. Closing tickets requires a professional proposal and the ability to ask for and obtain the commitment.
Revenue Architects works with leading asset management firms to enhance their third-party distribution, build marketing and sales strategies, deliver value-added programs and envision integrate marketing programs. Contact John Stone to learn more about our work with asset management firms.