Blog Entries by Peter McGratty, VP of Business Development, Pinnacle Advisor Solutions

Clients are Comparison Shopping

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Clients Want It, Advisors Need It, Advisors Adopt It

Amy McIIwain, President, Financial Social Media

Last year was a watershed for the financial advisor community: it marked the year when philosophical prejudices about investment management acquiesced to the practical needs of advisors as small business owners. More plainly, after nearly twelve years of lackluster performance and a growing sensitivity among clients to downside risk after two market bubbles, it seems that many advisors are conceding the need for a more risk-managed investment solution to protect client assets, and, in so doing, protect their own businesses. We observe the following:..Read More »

Avoiding the Value Trap

Is the value you believe you offer the same as the one the client perceives? I raise this question because I am meeting so many advisors who are confusing the idea that their clients trust them to manage their financial affairs with the idea that their clients trust only them to invest the money. As a consequence, they are trapped: their businesses are often not growing and they feel unable to change course, all because they misunderstand the fundamental value proposition that underlies their client relationships. In the past, this wrong turn was into the right neighborhood – asset management – which proved profitable regardless; but the neighborhood is changing and I argue that you should use this strategic planning season to reconsider your path and maybe even ask for directions...Read More »

What Do Economies of Scale Look Like to Your Clients?

One of the key themes we discuss with advisors is the re-emergence of economies of scale as a driver of RIA business success. To date, we have discussed this theme in terms of an advisors inability to find the time and resources they need to “keep up” with day-to-day business demands or to focus on new business development to grow the business. Today, we want to explore what economies of scale look like to client prospects and what that means to the competitiveness of firms without it. In most industries, firms that achieve economies of scale are in a position of competitive advantage. Why? Because, by definition, a larger revenue base affords these firms a greater resource base with which to support front and back office efforts. These firms can afford to dedicate personnel and resources to specific efforts like marketing, technology, customer service and product (planning, investing, insurance, etc.). Smaller firms simply do not have the revenue base to do so. Principals must therefore operate as “jack of all trades” taxing their time and risking the perception that they are “master of none”. The table below illustrates how much additional resources are afforded by scale...Read More »