Even before the COVID-19 crisis began, the role of wholesalers was changing. A stampede of advisors from centralized wirehouses to smaller independent firms has made it more costly and time consuming for wholesalers to conduct their traditional home office walk-ins and lunch-and-learns. And with most advisors able to research and select funds on their own, they're becoming highly resistant to cold calls and marketing emails.

Emilie (McClughen) Totten
Synthesis Technology
Head of Marketing

The pandemic may be driving the final nail into the coffin of these old-school sales approaches. One recent survey of advisory firms reported that even with stay-at-home orders lifted in nearly all states 75 percent to 100 percent of advisors continue to work at home.¹ With many struggling to manage their work/life responsibilities, they simply don't have the time or desire to listen to or read yet another unsolicited sales pitch, especially those for "vanilla" products that have similar investment objectives and track records.

While many wholesalers are itching to hit the road again, many advisors are unlikely to return to their offices full time even after the threat of the pandemic eventually ends.

To remain competitive in a world where effective virtual communications will become more important than on-site meetings, sales, marketing, client service and portfolio management teams will have to collaborate more closely than ever before to develop and execute more creative, innovative, nimble and laser-focused strategies for cultivating and retaining advisor relationships.

We've spoken with a number of large and small asset managers to learn how their wholesalers are adjusting to this new reality. Here are some of the strategies they're using both to stem attrition and, when opportunity arises, win new business.

Delivering critical performance data faster

The transition to a digital environment has heightened expectations among advisors that they'll quickly receive updated information on the funds they use in their clients' portfolios. This means that marketing firms can no longer take weeks to update quarter-end performance metrics in fund brochures, fact sheets, pitchbooks, consultant databases and web site product pages. This need-for-speed is driving increasing interest among many asset management firms for investment content automation solutions that can instantly update these materials with performance information stored in a central data repository. Enabling wholesalers to deliver these updated materials quickly after month- or quarter-end gives them — and the firm — a competitive edge.

Changing hats

For the most part, there's very little actual "selling" going on in the current environment unless the asset manager has a benchmark-beating product that fills specialized niches. For example, wholesalers at one boutique asset manager we've spoken to are only promoting their newly launched ESG fund, which has outperformed the broad market this year and is filling a growing demand among younger clients for impact investing options.

For the most part, however, wholesalers are focused on stemming outflows. According to a recent survey of wholesalers at boutique firms, retaining clients is far and away their highest priority right now.²

In this environment, wholesalers need to change their sales caps for client service hats. One large fund company we've spoken said that their wholesalers have made 50,000 phone calls to advisors since the crisis began. Approximately 90 percent of these calls are focused on answering advisors' questions and concerns and providing talking points they can use with investors to convince them to stick with their funds.

Becoming thought leadership ambassadors

Even before the crisis began, it was no longer acceptable for wholesalers to simply drop off fund brochures and pitchbooks and deliver canned "spins" on performance. More than ever, advisors want to hear directly from the firm's investment thought leaders.

Nimble asset managers are responding to this demand by bringing their sales managers, investment managers and marketing teams together to figure out how to meet this increasing demand for their portfolio managers' time.

Several firms we spoke to are transferring money allocated to portfolio managers' travel to on-site meetings and conferences to increase the frequency and quality of market commentaries, whitepapers and blog posts appearing under the managers' bylines. Firms that had never heard of Zoom before March are now persuading portfolio managers to make video commentaries and hold Q&A sessions with advisors. One smaller fund company is offering to have their chief investment officer deliver quarterly market updates directly to investors on live webinars hosted by their key advisory firm clients.

And what is the role of the wholesaler in this process? They're becoming the conduit for their firms' subject matter expertise. By offering access to value-added insights, rather than sales pitches, they're not only differentiating their firm in a crowded marketplace, but they're increasing their own value as well.

Thinking outside the "investment box"

Advisors are bombarded by dozens — sometimes hundreds — of investment-themed phone calls and email messages each week. To help them stand out, some wholesalers are thinking of ways to deliver other kinds of relevant content.

A wholesaler at one firm we spoke with recently sent an informal email questionnaire to all of her advisor clients and prospects asking them to share their best practices for cultivating prospects and strengthening existing relationships in a socially distant environment. After receiving more than 100 responses, she worked with the firm's marketing department to create a whitepaper reporting the results that she not only sent to her own clients and prospects but allowed her fellow wholesalers to share with their own contacts. (Read a summary of this research.)

Leveraging technology to deliver more personalized contacts

The days of "one-size-fits-all" pitchbooks are over. Wholesalers need to become more customer-centric in their sales pitches. One way they can achieve this is by working with their marketing department to create customized sales bundles that include a mix of standard materials as well as personalized cover pages that reflect their knowledge of each advisor's unique business practices and challenges.

CRM systems can be an invaluable resource for creating these customized approaches. When used effectively, they can provide a holistic view of each advisor's client service model and investment selection methodology.

A growing number of firms are also using sales and marketing automation software to track clients' and prospects' level of engagement with their web site and digital marketing campaigns. This software can report which email messages advisors open or ignore. It can track how often each advisor visits the firm's web site, which pages they read and which manager videos they view. It can tell which advisors click on a firm's LinkedIn or Twitter posts. And it can report how often advisors attend a firm's webinars or conference calls — and how long they stay.

Most marketing automation software also generates "lead scores" for each client and prospect that can help wholesalers instantly understand how engaged their contacts are. When this data is fully integrated with a firm's CRM system, it creates a powerful wealth of intelligence that can help wholesalers prioritize their outbound contact schedules and make sure that each contact reflects their understanding of the advisor's interests.

With collaboration, anything is possible

In many asset management firms, sales, marketing and portfolio management rarely collaborate on a large scale. Their activities often only overlap when one department needs something from another. A wholesaler contacts a marketing manager to request a customized pitchbook. A writer interviews a portfolio manager for information needed to update a fund fact sheet.

This siloed environment is no longer sustainable. With advisors demanding speedier delivery of performance information and a higher degree of access to the thinking of the firm's thought leaders, it's more important than ever for portfolio managers, sales and marketing to collaborate and coordinate their efforts to make sure that every message a wholesaler delivers to their clients and prospects is timely, valuable, relevant, and actionable. If this is done correctly, more prospect conversions and higher inflows should follow.

¹ fa-mag.com/news/staying-close-while-being-remote-56492.html
²Sondhelm Partners, Weathering the Storm: How Boutique Asset Managers are Adjusting to the New Reality, June 2020.

Emilie Totten is head of marketing at Synthesis Technology, an enterprise software company serving the investment management industry.

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