Australasian financial advice businesses would likely follow the global trend to “behavioural coaching” as investment management becomes more commoditised, according to Pat Spenner, head of marketing for the Christchurch-based Capital Preferences.
Spenner said early data from a Capital Preferences survey of the US industry suggested there was already a “general migration” of advisory business models away from pure finance-based advice to offering broader “financial well-being” services.
He said the US survey results to date – which include both qualitative and quantitative research – also showed leading advice firms focused on “deeper and tighter” relationships with a niche group of clients rather than taking on all-comers.
While Australasian advice markets lacked the scale of the US, Spenner said financial advisers both in Australia and NZ were no longer confined by geography.
“Technology is breaking local bounds,” he said. “Advisers can market and service a niche audience in different cities online.”
Capital Preferences, founded by US ex-pat, Bernard Del Roy, recently launched a version of the survey aimed at Australian and NZ advisers.
Spenner, who emigrated from the US last year, said the survey, which takes about 20 minutes, would help build a more complete picture of how advisers understand their clients.
“Participants receive a benchmarking report at the end of August, and access to the full ‘Client Understanding’ best practice library that we’ll make available early October,” he said.
NZ advisers who take the survey would also have “immediate access” to the findings to date, the study website page says.
According to Capital Preferences, the adviser survey is “a first-of-its-kind global study” conducted in partnership with a number of industry bodies including the US Financial Planning Association and the Association of Financial Advisers in Australia. The Graham Rich-backed, Portfolio Construction Forum, is also promoting the survey.
“We will unpack the key elements of world-class client understanding and build a maturity roadmap for advice firms to get there,” the site says.
Spenner said traditional financial advice models everywhere were under pressure from technology and regulation – including fallout in this part of the world from the Australian Royal Commission into financial services.
“The value proposition for advisers is on the move,” he said.
Capital Preferences offers a behavioural science-based risk-profiling tool, TrueProfile, which recently launched in the NZ market.