Research* from Old Mutual International, part of Old Mutual Wealth, shows 54% of financial advisers across international markets are transforming their business model away from upfront remuneration towards a model that includes more recurring revenue streams aligned to a more consistent ongoing client offering.
The research forms part of a new White Paper from Old Mutual International on the evolution already underway in the international advice market, which includes market perspectives from strategy and transformation consulting organisation Capgemini Consulting UK.
The paper aims to help advisers understand how the combination of regulatory convergence and shifting client expectations are creating new opportunities for international advice businesses. It identifies and navigates some of the subsequent threats associated with these changes, showing how advisers can adapt and thrive in this new world.
While all international markets are not progressing at the same speed of regulatory change, the direction of travel is consistent. Globally, client expectations are evolving, demanding greater transparency and value. Advances in technology are also contributing to a change in expectations, with clients being able to access more information and demanding greater access to online services.
Capgemini Consulting UK, with its experience of the evolution of the UK wealth market and the wider international adviser landscape, believes that advisers need to consider the following which may help them to thrive over the long term:
- Sustainability – advisers need to consider providing differentiated advice and engagement models offering wider choice of services to clients.
- Striving for better customer outcomes – advisers need to ensure they are offering customers compelling value that can be clearly articulated and demonstrated.
- Efficient business models – advisers need to review their business practices and leverage technology where possible to ensure they achieve a lower cost of advice model and at the same time remain profitable and sustainable.
Over the coming months, Old Mutual International will open the debate with international advisers to help shape its new Future Fit programme of support. Adviser feedback and input will ensure its Future Fit programme develops the specific support and expertise required to help advisers evolve their business.
Steven Levin, CEO investment platforms, Old Mutual Wealth, comments:
“The transformation taking place in the international advice market is a positive change and will help ensure the future success and credibility of the sector. Forward thinking advisers will be the long-term winners, and those who do not embrace change risk being left behind. The debate we are leading with financial advisers will help demonstrate the importance of these changes, and, importantly, will help shape the support we offer firms going forward.”
Rod Bryson, Principal, Wealth, Long Term Savings and Insurance, Capgemini Consulting UK, comments:
“Today’s clients are in a better position to question and challenge – but also to appreciate the value a financial adviser can offer. Financial advisers across many international markets are becoming acutely aware of the need to evolve and transition their business, and it is easy to see how this evolution might snowball. The lead taken by Old Mutual International is a welcome move, and will help open discussions with advisers, encouraging and supporting those looking to evolve with sustainable and customer centric business models.”
The White Paper is available at www.oldmutualinternational.com/futurefit
* Old Mutual International survey to international advisers, Q4 2015