Cogent Research: To Win and Keep Business DC Plan Providers Need a Dual Focus

  Cogent Research: To Win and Keep Business DC Plan Providers Need a Dual

Business Wire

CAMBRIDGE, Mass. -- November 14, 2012

When it comes to deciding which DC plan providers to recommend to clients,
advisors prioritize their own needs. However, once a plan is in place advisors
are most loyal to providers that effectively demonstrate their value and serve
the needs of sponsors. This means providers need to deliver effectively for
both advisors and sponsors if they want to win and keep more business. These
and other findings are included in Retirement Plan Advisor Trends^TM 2012, a
new report released recently by Cogent Research, based on a nationally
representative survey of 520 DC plan producers with a minimum of 5% of total
AUM invested in 401(k) plans.

“Obviously, there are broad set of factors that influence whether or not an
advisor will consider recommending a provider, but our research suggests that
unless a company demonstrates it’s easy to do business with and can support
the business needs of the advisor, it’s not going to make the cut,” explains
Linda York, Research Director at Cogent Research. Three firms emerge in this
year’s study with the strongest position on these key drivers of
consideration: American Funds, Fidelity Investments, and John Hancock
Financial Services.

“Once a plan is in place,” York continues, “the emphasis shifts to
demonstrating value for the money and keeping the sponsor happy, thus reducing
the need for the advisor to spend too much time troubleshooting the account.”
Only one firm, Fidelity Investments, ranks among the top three in the key
aspects of consideration and satisfaction.

“Many providers are great at giving advisors what they need to sell plans, and
others are great at giving plan sponsors best in class services, but very few
have figured out how to do both. Being all things to all people isn’t easy,
but it’s what providers need to do if they are to gain and keep plans sold
through advisors,” York concludes. “Firms targeting this market need to excel
in meeting the needs of advisors and plan sponsors simultaneously – a
combination that will help them win and keep business.”

Key Drivers of Consideration: Top 3      Key Drivers of Satisfaction: Top 3
Firms                                       Firms
Easy for advisors to do business with       Value for the money
1. American Funds                           1. American Funds
2. Fidelity Investments                     2. Charles Schwab
3. John Hancock Financial                   3. Fidelity Investments
Services/Nationwide Financial (tie)
Best-in-class plan sponsor service          Plan sponsor service and support
and support
1. American Funds                           1. Fidelity Investments/Great-West
                                            Retirement Services (tie)
2. Charles Schwab                           2. Principal Financial Group
3. Fidelity Investments                     3. Nationwide Financial

Source: Cogent Research Retirement Plan Advisor Trends^TM 2012

About Cogent Research

Cogent Research helps clients gain clarity, obtain perspective, and formulate
direction on critical business issues. Founded in 1996, Cogent Research
provides custom research, syndicated research products, and evidence-based
consulting to leading organizations in the financial services, life sciences,
and consumer goods industries. Through quality research, advanced analytics,
and deep industry knowledge, Cogent Research delivers data-driven solutions
and strategies that enable clients to better understand customers, define
products, and shape market opportunities in order to increase revenues and
grow the value of their products and brands.


Cogent Research
Anne Fallon, 617-715-7611
Press spacebar to pause and continue. Press esc to stop.