Firms Should Consider Embracing New Business Models and Making Key Investments in Advanced Analytics to Compete
DST kasina, LLC, a provider of data-driven insights and distribution solutions to financial companies around the world, today released new research about transforming product, distribution and marketing strategies in the face of industry consolidation and disruption.
The free white paper, "Capitalizing on Disruption: Transforming Asset Managers for 2020," looks at the opportunities for asset management firms to invest in advanced analytics and adopt modern business practices to identify their most profitable relationships, rationalize and innovate their product lineups, and modernize marketing to fully engage clients.
"Asset managers are operating in a challenging environment characterized by industry consolidation, new entrants, new technologies, and regulatory pressure," says Steven Miyao, President of DST kasina. "Leading firms believe that the traditional ways of doing business must fundamentally change, starting with the need to secure a strong foundation with data and analytics, in order to deliver the products and services clients want."
While a few firms have begun to tackle these challenges, DST kasina's new research finds most asset managers continue to struggle with the same issues identified in a previous DST kasina study four years ago:
- Data-informed: Leading companies refine their business strategies by collecting data from every customer touchpoint, whether it's the call center, meetings, conferences, websites, email, or social networks. At this time, just 3.8% of firms have fully implemented the collection of advisor insights from every touchpoint and the use of advanced analytics to drive decisions. Another 42.3% of firms are part of the way to that vital goal. Leading firms that have addressed these problems believe they have a significant advantage in key strategic decision-making from sales to product development to customer experience.
- Digital: Sophisticated omni-channel marketing will be an essential differentiator for advisors, especially since 52.4% say that their interactions with firms will be predominantly digital by 2020. The digital experiences provided by asset managers already influence the perception of their overall capabilities for 72.8% of advisors. Today 46.2% of asset managers have partially implemented omni-channel marketing but none has achieved full implementation.
- Differentiated: Asset managers and advisors are at odds about what factors will drive advisor decisions to do business with firms when evaluating similar products with comparable performance. 84.4% of advisors say value-added services will be a top factor in their decision to do business, compared to 11.5% of asset managers.
The white paper includes additional key findings on factors influencing financial advisor business decisions, recommendations to position organizations for success in 2020, and a detailed scorecard for organizations to rate their progress on building competitive business strategies, capabilities and cultures.
"Leaders are distinguishing themselves from laggards in three concrete ways," says study author Julia Binder, Head of Strategic Marketing Research, DST kasina. "They are integrating advanced data analytics to inform business strategy, expanding digital engagement to earn business, and promoting a differentiated value proposition to build long-lasting relationships. And they are already reaping the benefits of standing out in the market."
The "Capitalizing on Disruption: Transforming Asset Managers for 2020" report is based on findings from DST kasina's Advisor Insights survey, conducted in November 2016 in association with Horsesmouth, of 416 U.S. financial advisors; a survey of 26 asset managers, and prior DST kasina research.
DST kasina, LLC, helps leading companies in the financial services industry manage data, gain insight, and ignite change in their business. Through effective use of advanced analytics, research, and distribution intelligence technologies, DST kasina enables businesses to better understand, predict, and optimize key business factors impacting their asset growth and profitability.
DST Systems, Inc. (NYSE: DST) is a leading provider of specialized technology, strategic advisory, and business operations outsourcing to the financial and healthcare industries. We enable clients to transform complexity into strategic advantage by helping them continually stay ahead of and capitalize on ever-changing customer, business and regulatory requirements in the world's most demanding industries.