Homer’s catchphrase is one of the most recognisable in sitcom history and is usually uttered when the Simpsons patriarch injures himself or realises that he has done something stupid.
Pinnacle Practice director, Anne Fuchs, believes too many dealer group licensees are having a d’oh! moment in the ongoing land grab for advisers – splashing cash around buying up distribution and enhancing platforms, instead of innovating on consumer-orientated advice solutions.
“The industry is a bit like Homer Simpson continuing to stick his finger in the electrical socket, getting electrocuted and not learning the lesson,” says Fuchs.
“While there may not be much profit in running dealer groups, there is clearly a lot of profit in products and platforms, and licensees continue to use these profits to buy more distribution to sell more expensive product to consumers – is that really an effective use of profits?”
Serial offenders
Fuchs, who runs adviser/licensee matchmaking service, My Dealer Group, argues that while this behaviour continues, consumers will continue to view advisers as product sellers, trying to push them into buying products they don’t need or that are too expensive.
“We all know the statistics,” she said. “Only two in 10 consumers seek advice. Wouldn’t it therefore make more sense for licensees to use product and platform profits to innovate on consumer-orientated solutions that deliver what the consumer actually wants?”
Fuchs contends that licensees who adopted this approach will attract more advisers.
“Advisers will be attracted to these licensees because this approach will help them win more clients,” she says.
“Licensees are still too quick to write big adviser cheques. Platforms are still all about profits and industry efficiencies. They are not consumer-centric. We need to adopt a new way of providing advice that is.”
Or “Do’h! Do’h! Do’h! I mean woo-hoo!” as Homer might put it.
