Key findings of the Investment Trends 2015 Planner Technology Report

From
  • Peker Recep

    Peker Recep

    Financial planners’ freedom of platform choice is at its highest level ever

  • The formula for success has changed, platforms now need to help planners demonstrate value
  • netwealth has the highest satisfaction amongst its users
  • BT Wrap and CFS FirstChoice are the most-used platforms, but third place is hotly contested

In its twelfth year, the May 2015 Planner Technology Report is an in-depth study of Australian financial planners and their technology needs. The study is based on a survey of 892 financial planners concluded in May 2015, and identifies key trends in the platform market:

Financial planners’ freedom of platform choice is at its highest level

Financial planners’ freedom of platform choice continues to increase, reaching its highest level since 2010 when Investment Trends began tracking this metric. Three quarters of planners now say they have full or some degree of freedom when choosing platform providers, up from 70% saying so in 2014 and 64% in 2013.

“Financial planners have been seeking increased flexibility with product choice since the Future of Financial Advice Reforms and many are now achieving freedom of platform choice,” said Recep Peker, Head of Research for Wealth Management at Investment Trends. “This is both a threat and opportunity for platform providers, as those who best address planners’ needs will win their business.”

Planners are using their increased freedom in platform choice to adopt a 1+1 approach to platform usage. Of the new client inflows invested via platforms in the last year, planners’ most-used and second most-used platforms received 92% of flows, on average.

“Planners are favouring an efficient two-platform solution that can provide them with everything they need to service their clients,” said Peker.

The formula for success has changed, platforms now need to help planners demonstrate value

The greatest benefit provided to planners by the established platforms who have been successful are typically increasing practice efficiency and lowering cost to clients. In contrast, delivering value to clients is seen as the top strength of the platforms that are attracting a disproportionate share of switchers and new users – North, netwealth and HUB24.

“Planners see the strengths of the established platforms to be lowering costs and increasing practice efficiency, which were essential ingredients in the pre-FoFA way of doing business,” said Peker. “In contrast, the success of up-and-comers such as North, HUB24 and netwealth in capturing a greater share of new relationships are partly driven by their ability to help users deliver value to clients.”

“The future winners in the platform space are likely to be those who are helping planners deliver ongoing value to clients.”

netwealth has the highest satisfaction amongst its users

At an industry level, platform satisfaction has stabilised near last year’s high. netwealth leads the platform industry in terms of overall adviser satisfaction, followed closely by HUB24. CFS FirstChoice and Macquarie Wrap are tied for third spot.

The top four platforms by planner satisfaction are:

  1. netwealth
  2. HUB24
  3. CFS FirstChoice
  4. Macquarie Wrap

BT Wrap and CFS FirstChoice are the most-used platforms, but third place is hotly contested

BT Wrap and CFS FirstChoice are the two most-used platforms by number of primary planner relationships, with 16% using each respective platform the most for new client inflows. Macquarie Wrap, North and Asgard eWRAP are neck and neck for third spot.

The top five platforms by number of primary relationships are:

  1. BT Wrap
  2. CFS FirstChoice
  3. Macquarie Wrap (including Macquarie Consolidator)
  4. North
  5. Asgard eWRAP (including Infinity eWRAP)

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