Asset Managers Must Use Web for Cost-Effective Distribution

Firms that find a way to sell by using inexpensive and scalable resources, such as the advisor Web site, to reduce their dependence on expensive wholesaling forces, will be betterpositioned for profitability in coming years, according to a new report from kasina.

Asset managers must find a way to distribute more costeffectively, according to a new report from asset management consultant kasina.

Due to a combination of market performance and outflows, assets under management at many firms have fallen 35% or more, and revenues have fallen in concert.

The days of 3040% margins are over, and the firms that find a way to sell by using inexpensive and scalable resources, such as the advisor Web site, to reduce their dependence on expensive wholesaling forces, will be betterpositioned for profitability in coming years, kasina noted.

In its latest study, "Using the Web for Cost-Effective Distribution, kasina said advisors that use a firm's Web site sell at least 25% more than advisors that do not. Looking at the firms that scored well, kasina identified the three potential areas of highest value to be interactive and comprehensive product information, timely commentary and insight and action-oriented business-building support. In today's environment, wholesalers must maximize their time spent in truly consultative roles with the "right" advisors, and by integrating the Web site into the overall sales strategy, a firm can accomplish this goal, kasina said.

"While firms are currently struggling to think of cost-effective solutions, the Web clearly needs to be an integral part of the discussion. Those who aren't thinking about it are likely to be leaving money on the table," says Mike Ma, principal at kasina.

"In our research, we've found that most wholesaling organizations are under-utilizing the Web site, and this presents a potential low-cost, competitive advantage," added Lindsay Geimer, senior consultant at kasina and lead author of the study.

"Given current economic conditions and the distribution challenges our industry is facing, firms should take time now to consider how they can integrate online and offline sales efforts to increase efficiencies."

Melanie Rodier has worked as a print and broadcast journalist for over 10 years, covering business and finance, general news, and film trade news. Prior to joining Wall Street & Technology in April 2007, Melanie lived in Paris, where she worked for the International Herald ... View Full Bio