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The Platforum: How do advisers view the platform market?

Freddie Findlater

Over the past few months, The Platforum has profiled some of the leading adviser platforms in the market.

We have identified strengths and weaknesses for individual groups backed up by our research and interviews with the financial advisers who use them.

This week we share some further insights from these interviews, carried out over the second quarter of this year. This positions our analysis in a broader context and neatly summarises where advisers see the market today.

The chart here examines sentiment among advisers for the platforms they use. We have plotted platforms according to the number of advisers who cited they were “warming to” the platform proposition versus those who considered the platform “legacy only” and would place minimal new business with the group in the future.

Are there any platforms which you may have disregarded in the past but which you are warming to? Are there any redundant or legacy platforms within your business that you plan to place minimal or zero new clients on?

The chart shows that advisers are generally willing to be re-engaged by platforms they had previously discounted, but there was little evidence of this happening in practice.

This underlines a great opportunity for platforms that can communicate (through any method):

  • Improved usability/navigation
  • Improved cost effectiveness

(either for all clients or a sub-set)

  • Improved fund range
  • New or innovative technological solutions.

Poor service, administration and support are as much a driver of ceasing using a platform as price and fund range.

There will always be a group of advisers basing decisions on price alone, but these will become less frequent as the gap between “expensive” and “cheap” narrows.

Some advisers are still reluctant to move legacy business, but we expect this to change eventually as advisers’ due diligence process on platform selection is placed under increased scrutiny from the FCA.

The Platforum is running its annual conference on 8 October and this is a great opportunity for advisers to hear from and meet the platforms. You can view the latest agenda and sign up for the event at : http://www.theplatforum.com/events-views

Freddie Findlater is head of adviser platforms at The Platforum

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What does the chart tell us about adviser sentiment?

  • Historically some advisers have discounted ‘life company platforms’ en masse due to poor experiences in the past.
  • This appears to be shifting as both Aviva and Axa’s Elevate platforms find that 12 per cent and 9 per cent of 208 advisers respectively are ‘warming to them’ and would consider using them more going forward.
  • Poor administration and service concerns continue to be the primary reasons for advisers’ reluctance to place further business with platforms. Cofunds (39.7 per cent), Skandia (27 per cent) and FundsNetwork (26 per cent) had the most mentions as legacy platforms.
  • There remains a large number of ‘position neutral’ platforms, groups that have not fallen out of favour with existing users, but are not attracting new users from other platforms.

Adviser views

Thameside Financial Planning director Tom Kean

Kean

Like a lot of businesses we have been through the platform selection process recently and it has forced us away from legacy platforms. I can’t help but think that Axa will be the winners form all this because they seem to have got so much right. The white-labelling works, access to Voyant is right for my clients ad their local rep is very good and engages with us. Although we like Standard Life, Axa just pipped them.

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Echelon Wealthcare director Alistair Rush

At the moment there seem to be a lot of providers that are working on their own brand awareness with consumers, in some cases going D2C. One thing that worries me is the tendency to communicate direct with clients. Being able to pick up the phone and get decent support is also crucial. We see more and more clients also looking to use the platform themselves to view assets and so the clunky technology with some providers puts me off. In some cases it is like they’ve got a house and built extension after extension when in fact they need to knock it down and start again.

Childs-Arthur

Arch Financial managing director Arthur Childs

Some Life Co backed platforms do seem to be improving more than others. One problem though is that most IFAs have issues with Life Cos at the moment and that is exacerbated if the platform is treated the same as other parts of the insurance business. I would like to see more adviser-owned platforms in the market but of course the finances are so tight that it makes it very difficult. 

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