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Interview: Peter Welch, Intermediary Director of Touchstone Financial Analytics

Rob Kingsbury talked to Peter Welch, Intermediary Director of Touchstone Financial Analytics, about the firm’s data gathering and the range of services offered to advisers

Rob Kingsbury (RK): Touchstone Financial Analytics is owned by Equifax. What’s the background to the company and how does MyTouchstone fit in?

Peter Welch (PW): Equifax is one
of the market-leading credit reference bureaus. It holds data on over half a billion consumers as well as some 70 million businesses around the world. In March 2011 it acquired Touchstone Financial Analytics, which for nearly 20 years has been gathering financial services data and providing market intelligence to the life, pension, investment and mortgage industries. Over 90 major life, investment and lender groups now use the software on a daily basis.

MyTouchstone is the adviser-facing proposition built from
the Touchstone database that enables our intermediary clients to gain a detailed understanding of the marketplace in which they operate, and implement sales and marketing strategies that will most profitably grow their businesses.

RK: What are the core services offered by MyTouchstone?

PW: MyTouchstone is designed
to give advisers the tools they need to properly plan and develop their businesses and to align their marketing and client acquisition campaigns with their business models. It allows advisers to see exactly how they compare to their peer group in their locality and we break that down by advice area and by product area.

We have three core services that advisers are finding very useful at the moment.

The first is our Adviser Charging Guide. We hold data from all of our registered users on the level of fees that they are charging. We are able to present that data to advisers in a league table format showing the fees that are being charged in the local area and nationally.

Another popular service is
the data we can provide for due diligence purposes on all the third party support services, networks, platforms and back office packages that advisers need to run successful businesses in the new RDR landscape. Advisers can get a view of what’s being used by other companies in their local area and we also provide tools that allow them to weigh up the pros and cons of the various services.

The third service is our Client Hotspots tool, which provides a heat map of the adviser’s local area showing where investors are located, and advisers can drill down into that data to find out what advice areas and products those investors are interested in.

Using these three services advisers can look at how they are performing relative to their local peers and then they can make some informed judgments based on that information. For example, they may decide that they should be expanding their proposition to include other areas or, in contrast, that they should be taking action to protect their position in areas where they have a particular strength.

I know a number of firms, for example, that use the data to get the message out to their existing clients or in their marketing messages that they are a top ranking local firm in a particular area of expertise, whether that’s investment or pensions, etc.

RK: So the tools are helping firms develop their business strategy?

PW: Exactly. A lot of the firms
we deal with are using the data
to give them the edge they need to take their business a stage further, by giving them the tools and information to better plan their strategies. I was with a firm last week where the principal said that they discussed MyTouchstone data at every quarterly board meeting.

There are likely to be considerable pressures on financial advice firms under RDR in 2013. Margins in particular are going to be put under pressure and what we are seeing is a whole new way of working that
is going to force advisers to regularly review their business strategies. I think more and
more will be looking for external support and information because they realise they will need it to make themselves stand out in the market, not only to attract new clients but to retain their existing ones.

MyTouchstone provides the kind of useful data that will help them make the informed decisions to develop their business strategies.

RK: Can you provide some more detailed examples of how firms have used the tools?

PW: There are numerous ways in which advisers use MyTouchstone in their business strategies. Two readily come to mind that are very topical to the changes that are taking place in the market today.

Advisers regularly use the Adviser Charging Guide to compare their charges to other firms in their area. This has often enabled them to increase the level of the fees they charge – instantly improving their bottom line. They’ve been able to do this because they could point
to our data to help them define what their fees should be – and then, they have been able to communicate the change to their customers using our data as evidence, ensuring their clients still feel they are getting value for money. With many more adviser practices relying on fee income this kind of benchmarking is invaluable.

These progressive adviser firms are also seeing RDR as a window of opportunity, and using MyTouchstone to identify where they should be targeting their marketing.

For example, with other advisers having decided to sell their business, retire or move to mortgages and general insurance business only, and the banks dropping out of providing financial advice as well, there are many orphan clients in the market. We’ve had feedback
from firms that are using the MyTouchstone Client Hotspots tool to identify the location of potential customers so they can direct their marketing focus towards them, offering face-to-face holistic financial planning. In this way they are benefiting from the changes that are occurring.




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