RETHINKING DISTRIBUTION

Figure 1

Multiple drivers of change are at work in the Asset Manangement (AM) industry

Increased separation of alpha and beta and competition from other financial products • Rise of outcome-oriented products* • ETF growth • Increased competition from substitute products

Focus on pension and retirement products and solutions • Ageing population in major markets • Increased pension liabilities & public expenditure • Limits of pay-as-you-go systems

Increased exposure to emerging markets

Change in investor trust & loyalty patterns • Trust deficit • Demand for higher transparency • Diminishing client loyalty • Less captive clientele

AM industry

• Shift in economic power • Performance of emerging market funds • Growing middle-class in emerging markets • Success of UCITS in emerging markets

Increasing use of technology to reach investors • The emergence of mobile technology • Growing impact of social media • Targeting a new generation of customers

Increase in regulation

• Stricter and more uniform regulation • Increased regulatory cost and burden • Increased focus at the point of sale with diverging rules at national level • Increased protectionism

* Outcome-oriented products include liability-driven investments, capital-protected, absolute return and income-oriented products

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