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How DC Wholesalers View Their Role and Help Advisors

Service Providers

For advisors who do not have a DC wholesaler they view as a trusted partner, it’s worth the effort to find them, as they can serve as a valuable resource to help advisors build, grow and manage their business, according to a panel of industry experts. 

In an April 5 workshop session at the 2022 NAPA 401(k) Summit, Staci Baker with J.P. Morgan Asset Management, Alison Smith with the Principal Financial Group and Jonathan Wilkinson of T. Rowe Price, along with Kristen Koluch from Raymond James as moderator, shared their insights on the latest trends in the industry and how DC wholesalers can go above and beyond to help advisors.  

“What I’m hopeful of from this discussion is that you have one or two things that stick with you, that you're going to take back to your team and make actionable to make these relationships even more valuable to you,” Koluch noted in kicking off the discussion. 

Access and Communications

One major trend in the age of COVID that seems to have stuck is the Zoom call and how it has made it easier coordinate meetings. When asked how their days have changed in terms of the amount of time they are spending talking to advisors, Baker and Smith both noted that Zoom meetings have been helpful because you are able to have a lot more reach with who you’re talking to and strategizing with on ideas. 

“One thing J.P. Morgan has always said is our [portfolio managers] are not flying around the country, because they're actually managing money, but now that I can get the 12 people on the investment committee together with the PM, it has made my job being able to focus more on our thought leadership instead of just doing a fun pitch,” Baker noted. 

Finalist presentations are also down to about 30 minutes, even for $100-million plans. “It’s almost shocking to me to go, ‘Wait a minute, you’re going to make a decision on your $300 million plan by meeting with us for 30 minutes, but you’ll get to know what we think is the biggest silver bullets that were going to bring for that organization when we have to do it within a 30-minute period,’” Smith explained.  

Smith also has been seeing that a lot more RFPs in the mid-market have moved underneath the header of the “procurement department.” While part of the reason is to alleviate the stress from HR, it really shifts the dynamic for advisors and from a provider standpoint when you are dealing with a procurement department that does not understand the day-to-day operations of these things. “We’re spending a lot more time on the RFP when there is a procurement situation really trying to understand what is going on there and how we can put our best foot forward,” she explained. 

Investment vs. Value Add

When asked by Koluch about the differences between advisors coming to him with investment market-related questions versus looking for value-add and thought leadership, Wilkinson notes that it depends on the audience. There are some clients, whether at the advisor level or home office, where they only talk investments, but then there are others that he speaks with about everything but investments. Overall, he notes that it’s about 75% investment-related versus value add. 

“I think part of our roles as partners is to provide that next level of access. When an advisor or home office is looking to do due diligence on investments or final preparations, they really want to speak to the client PM, portfolio manager, somebody from that team, so I think that’s a big part of our role is providing that extra access when it comes to the investment side,” Wilkinson explained.

But in some cases, in might not be investment related. Some firms may want to know their thoughts on ESG, retirement income and crypto, and how these other things relate back to the DC plan, he further observes. “When it comes to value-add, I think our role is to ask a lot of questions, so we’re not just coming to them with whatever value-add programs and tools we have at our fingertips and force a square peg into a round hole,” Wilkinson notes. “And what we need to do is make sure that we are always putting the client first.” 

Similarly, Baker remarked that she has a goal of meeting with an advisor face to face at least two or three times a year, noting that the more she can see an advisor and know what their issues are, the more that she can help. “If you’re not seeing your wholesaler, I would encourage you to do that—you never know what they have to bring to the table,” she emphasized. 

Candid Feedback

And for those advisors where she has a good relationship, Baker says that she feels comfortable challenging them on different concepts, such as how they are selecting and monitoring their target date fund or inquiring about whether the plan sponsor has considered reenrollment. Baker also notes that she’s going to start challenging people about retirement income strategies. “I’m not saying there’s one right solution, but let’s have a conversation about it and let’s start making some decisions,” she notes, adding that these are areas where they can help advisors meeting these challenges.  

Echoing those points, Smith emphasized that being able to tell the client how to improve is part of the value proposition from wholesalers, particularly when advisors view them as a business coach. “If you’re open to that feedback from a business perspective, from the wholesalers that you trust, I think you’ll have a lot of eye-opening experiences that can change the dynamic of how you’re presenting yourself in front of your clients,” Smith explained. 

Smith notes that identifying ways that your network can be more powerful for you is another area that wholesalers can help with generating client leads, such as analyzing LinkedIn profiles or connecting with other centers of influence. 

Similarly, Wilkinson reiterates that the part of the benefit and value that wholesalers bring is access to subject matter experts, such as getting a speaker for one of their events or providing access to current industry research and trends as to what’s working and not working in the field.