Advisers need to escape regulation bubble
Financial advisers need to promote the services they offer rather than designations that are meaningless to many consumers, industry commentators say.
Friday, January 11th 2013, 7:04AM
Strictly Business owner Tony Vidler said after two years dominated by regulation, one of the themes of 2013 will be around how advisers articulate their value proposition.
He said like any industry, advisers need to try and put themselves in their clients’ heads to understand what they are looking for.
However, he said the near-constant talk in the industry about regulation could cause advisers to overestimate how much consumers know or care about the regime and its various adviser designations.
“With the internal industry focus on qualifications, licencing status etc, advisers tend to place a disproportionate weight on some letters for a course we did and assume they mean something for consumers when in fact they mean nothing for consumers.
“The consumer wants an outcome; they want a result.”
Heathcote Investment Partners director Clayton Coplestone also highlighted the value proposition of advisers as an important issue this year, saying advisers need to be able to tell clients “pay me this and I’ll give you that”.
Coplestone said the CFP designation is “largely irrelevant outside the industry” and what consumers seek from advisers is trust and transparency.
“Some advisers I call on have very little time in the day because they are doing extremely well at the moment because they are trusted advisers.”
Another trend Coplestone predicted for this year was a shift from ‘proprietorships’ to financial planning businesses that are less reliant on one person.
This, he said, would be driven by the desire of many advisers to increase the value of their businesses before retiring.
“If you are a one-man band and the client is only interested in seeing you it’s very difficult to sell.”
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