The Distribution Dilemma - Delivering personal engagement in a digital world
Two industry leaders and regular interlocutors on LinkedIn - veteran fund-buyer and self-proclaimed “left-field financier” JB Beckett and experienced sell-side executive and founder of the asset management sales optimisation application XALT, Patrick Murphy - recently exchanged views on the current state of Asset Management.
Patrick Murphy (PM): Good to meet up face-to-face again finally, JB! In the spirit of an early challenge, I’m going to start by asking you how you feel the Asset Management industry is doing after two years of COVID and other contextual influences. On the up, trending down or good old “status quo ante”?
JB Beckett (JB): Hi Patrick. Great place to start! I’ve been thinking about this a lot recently and wonder whether, in a sense, we’ve lost our physical selves in what has always been the most human of occupations, fund distribution.?
Asset Management has always been good at the gloss such as marketing, events, awards, etc but beyond that - the direct engagement at the individual buyer level - has always been pretty average. To my mind, sales teams have over-relied on what I would call superficial interaction - the routine face-to-face update, armed only with last quarter’s pdf and little else that’s new or insightful.
PM: So do you see these as simply topical issues - due, for example, to spending too much time in socially-distant bunkers, relying on Zoom - which will dissipate as more and more of us spend more time back in the City and face-to-face? Or are you identifying more fundamental problems?
JB: More fundamental. Recent events in Ukraine have only served to accentuate some of the contextual uncertainties but - and without wishing for a moment to downplay the significance of that dreadful situation - I do feel Asset Management distribution needs to face up to some genuinely existential challenges: I observe too much behaviour that is still punctuated by a lack of data on the actual client, a lack of insights to share, and next to zero personalisation to buyer needs. And to make matters worse, their fund buyer clients have meanwhile become more professional and significantly better supported technologically. This threatens the efficacy - the existence even - of old-world relationship management.
PM: I recognise what you’re saying. The Asset Management clients we speak to regularly are telling us that things have got more difficult both generally (with a stark slowdown in fund buying activity) and specifically: they find it harder to get “quality time” with their clients and are realising that they need to bring much more to the table (insights, value) to open the door and get their clients to engage.
JB: I saw an excellent piece of McKinsey research* on decision-maker behaviour globally across industries since the pandemic began, in which they characterised it as a big digital shift that’s clearly here to stay.
They say that 70-80% of B2B decision-makers reckon they prefer remote human interactions and only about 20% of B2B buyers say they hope to return to in-person sales, even in sectors where field-sales models have traditionally dominated.
PM: Absolutely! So in that context, as a distribution salesperson, you absolutely HAVE to have more to offer than generic observations on sectors and your own funds. If that is all you are bringing to the relationship then your clients would prefer to self-serve. However, we also know that this period has highlighted the need for genuine human interactions that add value. Therefore, IF you come armed with an informed perspective on your funds, competitor funds, sector data, and insights on the market overall, then your clients will continue to enjoy and extract value from your relationships.?
The first step is getting in the door! Buyers can now choose to have meetings at home or the office. With that choice comes the ability to decide how to spend their time. So it’s inevitable that initial engagement has become more digital-first - meaning often the start of a discussion is through email or messages, where value needs to be provided quickly in short, well-targeted personal communications.?
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And, when that all-important physical meeting occurs the salesperson better have more to offer than a suitcase of factsheets and pitch books. They need to be able to respond to direct questions with direct answers and offer a more expansive discussion around the value and risks of each investment fund.?
The challenge is as ‘generalists’, the salesperson needs to channel the investment team and speak with one knowledgeable voice across all investments, with timely and relevant insights. This is the toolkit that next-generation asset management sales teams need so that they can deliver distribution at scale and succeed.
JB: Yes, absolutely. And guess what? Those tools, techniques, and technologies are surprisingly straightforward in the sense that they are meeting the buyer’s needs:?
PM: That seems relatively basic stuff - “providing solutions to meet consumers’ needs”. However, simple is often very complex to deliver and the tools are not always available to sales teams. This distribution scale does not come without investment in data and technology. So asset managers really need to invest in their distribution teams, yes?
JB: Correct. Author, tech philosopher, and general digital guru Dr. Tom Chatfield refers to having “rich, open, exploratory encounters”. That’s what fund-buyers want. That’s what distribution sales teams need to be able to have - armed with the right tools, techniques, and technologies.
PM: And it follows that distribution leaders need to make sure their teams have the right tools and technologies at their disposal and not just boots on the ground and fingers on the keyboards, right?
JB: Couldn’t agree more. It'd be great to hear what our networks think.
https://www.dhirubhai.net/in/pjmurphy79/
https://www.dhirubhai.net/in/jonbeckett/
Distribution Specialist | Sales & Product Strategy | Business Intelligence
2 年Thanks for sharing Patrick, JB. Certainly resonates with my views on future of distribution, and greater conviction coming from anecdotes of client “event fatigue” (already!) and fund buyers/asset owners being increasingly selective on who they ‘let in the door’. Interesting point raised re increasing “self service”, (from a central source? eg Door, M*; or with each AM building their own digital interface? - beyond a website!). This maybe supports a shift of requirements from ‘sales person’ to ‘specialist’ - I’ve never liked the term “sales”, feels much more transactional than relationship, which ultimately is how trust is developed. Feels like the optimal model is somewhere on that “Rolodex” and “Smart Distribution” spectrum - with greater efficiencies (and effectiveness) closer to the latter. Would be great to hear who is doing this really well, from a fund buyers’ perspective?
Tom Chatfield ??