By Greg Bright
Brian Thomas, well-known funds management marketer, has been let go at Perennial Value, the quality Aussie equities shop. He had been at Perennial for more than 11 years, and before that made a name for himself at Macquarie and Credit Suisse.
The redundancy is another indicator of how everyone, it seems, needs to re-invent him or herself for the future due to changing industry and technological dynamics.
Anthony Patterson, the executive chair and long-time Perennial business manager, and John Murray, the chief executive and CIO, who has similarly been at Perennial for many years – launching its first value-oriented Aussie equities capability – made Thomas’s position, as general manager of investment services, redundant late last year.
There are several factors at work in the current environment for funds management which inevitably lead to well-paid executives having their role either diminished or abolished. The phenomenon is becoming more common. These factors include:
- Technology is changing everything, including traditional sales and marketing processes.
- The number of “client influencers” is declining in both the institutional (big super fund) and wholesale (dealer group and financial planning) world.
- Margins are being squeezed like never before. If you can do a job with a smart 27-year-old PhD graduate for half the price of a 50-year-old traditionalist, then, why not?
- The job that marketers – as well as investment managers – are doing is changing. Distribution channels are rapidly evolving to encompass stock brokers, managed accounts providers, ETF and LIC promoters as well as financial planners.
- Financial planners’ influence is declining because of the concentration of dealer group ownership, at least until a few years ago when the trend to independence seems to be swinging back, and
- A range of other new-style investment vehicles, from LICs, LITs and ETFs through to SMAs and IMAs – is catching on, putting pressure on old-fashioned unit trusts, for which there has been a well-established distribution infrastructure for many years.
Patterson said last week that funds management distribution was changing and that companies, such as Perennial, needed to adapt to those changes. He said these changes included the growth in new listed vehicles, as well as other options such as managed accounts.
Also, there was the more general development of online marketing and use of big data to reach a greater audience more efficiently.
(Shed Connect, a company of which this writer is an executive director, for instance, uses lead-generation technology to provide its clients with cheaper access to the broad investor and advisory market.)
But Patterson, himself a veteran funds management marketer, was optimistic for the future of experienced sales and marketing people. His view was that the changes, such as new vehicles and distribution channels, would mean that experienced and well-connected sales people would be able to influence the direction of distribution in the future.
“I think there is more of a demand for experienced sales people now than ever before,” he said.