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Advisers face minefield in choosing business model

Product providers admitted that they face new marketing challenges posed by the changing role of advisers in a depolarised regime.

At a Money Marketing round table discussion last week, providers acknowledged that they had a role to play in helping IFAs develop business models.

Intermediaries claimed that they faced a minefield over which business model to choose and said that a vast proportion of the industry had failed to calculate which model would be best for them.

All the participants agreed that the shape of financial advice firms would change, with many businesses developing multi-ties as well as an independent fees and commission arm.

They also thought that consumers would have the chance to set the agenda of change. Punter Southall IFA director Geoff Tresman claimed that high-net-worth clients would reject fees because they did not want to pay 200-300 for an advice consultation.

Other intermediaries believed that increasing consumer need for more detailed product information should drive changes in marketing techniques from advisers.But they thought that there was a greater retail mentality towards financial services growing in consumers.

Prudential director of distribution marketing Andy Lucas says: “Intermediaries need to consider what are the implications for them with this model.”

Sesame marketing director Stuart Gisham says: “If we are going to succeed, we need to realise that there is this retail mentality growing in consumers. They can shop around. Providers will have to look at the way that they work with each individual firm.”

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