Mr Alcock made the comment in response to a Tria Investment Partners study, which suggests a segment of advisers targeting affluent customers expects to reduce their FUA on platform by nearly 10 per cent over the next three years, creating a $22 billion hole.
Those platforms at risk are more traditional kinds, which have yet to evolve to cater to advisers’ administrative needs, Mr Alcock told ifa.
“To me, the message (of the report) is absolutely right. If you don’t build it, it’s not going to work,” he said.
“I agree generally that traditional platforms, if they don’t evolve, will risk not being able to service high net worth clients. They have to keep up with what’s going on in terms of investing and administration.
“High net worth clients have to consider what their best administration vehicle is. If you’ve got the goods, they will go there. So I don’t see it as a hole, I see it as an opportunity.”
Mr Alcock said advisers are looking for a range of features on platforms, including 24/7 reports and mobile access, since that is what their clients are demanding.
“If you’re running a high net worth portfolio and you don’t have tools to let your client log in and see what their balance is today, that’s a bit of a risk in my perspective,” he said.
“Clients want to see where they stand. They want the ability to do that. It’s the ability to have real time reporting, that’s what platforms need to be offering.”
Tria’s study, Tria Australian Wealth Insights Programme, found that advisers targeting high net worth clients expect to reduce theirs by nearly 5 per cent, while mass affluent-focused advisers predict they will pull 2.6 per cent of their FUA out of platforms by 2018.
While platform use is not expected to disappear entirely, the predicted reductions could have an impact on assets and revenues, it said.
RT, if you think a platform provides what a good financial planner does, you have no idea what a good financial does at all.
Yes, I’m a planner but a fee for service one since 2004.
[quote name=”Commentator”]Hahhaha this is laughable. It’s not lack of innovation that is driving clients away from platforms. It’s the asset based fees that they charge. After all – Technology and the ability to report and administer $100,000 and $1,000,000 doesn’t change but the charge changes dramatically.[/quote]
Commentator, this is an issue that is still around, with the level of service offered per account balance.
Is High Net Clients is still $250K and above ??
Kind regards,
Adrian Totolos.
Business Analyst
Andrew is right.
If you build the product (platform) and get it out to your sales staff, the new business should roll in.
Kind regards,
Adrian Totolos.
Business Analyst.
Commentator, its not clients waking up one morning and saying “Gee, I want to get out of that platform because they charge an asset based fee”.
Advised clients change platforms or move to a different administration / holding structure on advice from an adviser – the vast majority of whom charge an asset based fee.
Advisers are under increased pressure to justify their fees. As platforms deliver more and more client based functionality an adviser who charges a client an asset based fee, or even a high annual fee, demonstrating the value of their on-going service is getting more and more difficult.
With great fee of a public stoning could it be that some advisers are recommending changing from a platform that is delivering information and functionality direct to the client that the adviser has wrapped up their annual service proposition and so needs to take the focus off their own fees?
Hahhaha this is laughable. It’s not lack of innovation that is driving clients away from platforms. It’s the asset based fees that they charge. After all – Technology and the ability to report and administer $100,000 and $1,000,000 doesn’t change but the charge changes dramatically.