Fund firms are using data to help them sell their funds

"The world's largest asset management firms have quietly launched an arms race to collect, analyze and exploit data about financial advisers. Some of the larger companies have entire teams dedicated to the effort," according to a recent article in Investment News.

The article mentions $900 million financial advisor Phil Huber from Huber Financial. “It's kind of funny. You'll get an email from a fund company, click a link, and you can pretty much guarantee within a day or two you're going to get a phone call from them.”

And it's not just the largest firms. More boutique firms also invest in data to understand who their advisors are - both clients and the universe who don't yet have positions.
Why is this happening now?

Firms can commit to engaging the advisor community instead of passively waiting for advisors to find them. If you have a good story to tell, firms realize they have to tell it now.

For firms who are aggressively trying to engage, they can tailor sales and communications programs to each advisor or each advisor segment that may help get more share of wallet than general sales and marketing activities alone. I tell the story of signing up for a Morningstar conference and receiving a very lovely leather binder from a mid-sized fund firm. The only problem is I'm not an advisor and will never invest in their funds. The incentive to visit their booth wasted marketing dollars.

Finally, through technology, firms can organize the data and create reports that used to be done by expensive people and spreadsheets. It's a much more efficient process to save time and money.

Another article in Money Management Executive discusses the trend.

Celera Systems,  SalesFocus Solutions, and Discovery Data are major data companies to the industry and were sponsors in our latest client conference.