“It’s fairly unlikely you’ll be using just one platform as an adviser, it’s perhaps more of a primary and secondary platform relationship the adviser will be adopting in their business, and client suitability will be key around that.”
In this instance, he suggests the larger platforms could be adopting the primary relationships and receiving the majority of business from advisers, with smaller platforms offering a more niche customer proposition for the remaining clients.
David Thompson, managing director, Axa Wealth, Elevate, adds that all platforms need to continually invest to meet the constant, and rapidly changing, regulatory environment as well as the changing demands of advisers.
He says: “Elevate is not currently one of the largest platforms in terms of total assets but has met this challenge with the on-going support and financial strength of its parent company. We have also benefited from the fact we don’t have huge legacy asset issues to deal with.”
Ms Mackay points out that profitability remains a clear metric of platform success and in this instance smaller player have perhaps taken the lead.
“Small platforms have been more likely to outsource technology and also to run the business with notably fewer staff. It’s an interesting exercise to compare the sales and marketing costs in bps of the small platforms against their large, people-heavy peers. This all contributes to the bottom line which can make happier reading for smaller platforms.
“Small can be beautiful and I see opportunity ahead for smaller platforms servicing advisers with specific needs AND for larger platforms supporting broader customer bases. I think we’ll see and hear more differentiation about exactly what type of customer any given platform is good for.”
Nyree Stewart is deputy features editor at Investment Adviser
BIG OR SMALL?
“Smaller platforms are currently taking market share away from the big platforms, but it’s not a case of big versus small in the platform world, it’s more like big versus beautiful.”
Mik Cons, executive Partner at Parmenion
“The focus for advisers is much more around client suitability and how they will be using platforms across their business. It’s fairly unlikely you’ll be using just one platform as an adviser.”
Mike Barrett, platform marketing manager at Skandia
“We recently announced that we are rolling out a multi-year, multi-million pound investment programme to deliver significant proposition and service improvements to our platform. We expect this will deliver significant flows to the platform over the coming years and preserve our market share.”
