Don’t Hire Another Wholesaler Until You’ve Embraced Digital Distribution

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Asset managers that raise assets through advisor intermediary channels are often inclined to resize existing territories and hire more wholesalers to boost sales. And traditionally, that was the accepted approach to growing AUM. 

Wholesalers were the front line of an asset manager’s distribution model, and conventional wisdom held that more feet on the street meant more conversations with advisors and, thus, more sales.

Digital Disruption

But as advisors increasingly embraced new digital tools and relied on search engines to find solutions for their needs, it became harder for wholesalers to get time in front of advisors. And when the pandemic hit and offices closed, the traditional wholesaler-advisor relationship evaporated. As a result, advisor access is the number one distribution concern I hear from asset managers. 

DRAFT - 6297 GK3 Blog - Dont hire another wholesaler_Number 1 Concern

Numbers Are Not in Your Favor

Today, the typical advisor spends 7 hours a day online, with 2.5 of those hours on social media. Advisors rarely take a wholesaler’s call anymore and never listen to the wholesaler's voicemail. 

Yet, old habits are hard to break for many firms. There is a common belief that despite the fact advisors prefer to research and conduct their due diligence online if firms hire more wholesalers, additional sales will follow.

But with an average $450K investment in a two-person internal/external wholesaling team, hiring additional sales staff is risky. The team will create an activity. They’ll leave voicemails and send email blasts to a vast swath of advisors in their territory. The external will make unscheduled office calls. But this activity will produce little if any, results.

Worse, a new wholesaling team that cannot produce will readily become an expense that reduces your profitability. So, what can be done to rectify a broken model?

Solving the Fundamental Problem

Fortunately, asset managers have a solution at their fingertips that can lift wholesaling teams back to prominence among advisors. And it starts with meeting advisors exactly where they are – online.

Digital distribution is the blueprint for growing your AUM in a digital world. It aligns the right people with the right process and technology to draw advisors to you. Digital distribution enables you to nurture advisor relationships online and provide signals to your wholesalers of who, when, and with what message to engage.

DRAFT - 6297 GK3 Blog - Dont hire another wholesaler_Digital Distribution Aligns

Deck Chairs on Titanic

To reiterate, the delta of activity you need to be successful with a conventional wholesaling approach cannot be accomplished profitably until you adopt the right strategy.

So, before you hire another wholesaler to use an obsolete model for raising assets and needlessly spending money you won’t recover, you need to embrace a digital distribution mindset that starts from the top down in your organization.

And once you have a digital distribution platform in place and are executing well, that is when you should hire additional wholesalers. Only then will your wholesalers have the tools and insights required to be of value to advisors in a digital-centric world.

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Topics: Inbound Marketing Digital Marketing Digital Wholesaling Financial Services Marketing Inbound vs. Outbound Content is King Sales Enablement Wholesalers Marketing Automation Business Development