Value Based Broking: The next wave of innovation

The world of financial services has come a long way from the paper flipping and cookie cutter solutions of the 90s. Today, you can buy bite-sized insurance that covers your specific needs, comprehensively create and invest in a financial plan through just a few clicks, and even avail credit in under 30 mins through both financial as well as non-financial firms. Across the financial services spectrum, companies are leveraging technology to stay ahead of the curve and create nuanced offerings for their customers. However, broking still has one leg grounded firmly in the 90s and is thus ripe for disruption. While strides have been made in facilitating seamless transacting at scale, product side innovation still remains limited. Companies make the journey from good to great only when they anticipate their customers’ needs, focus on product-side innovation, and enable seamless delivery of the product. Fortunately, we live in an era when forward-looking companies can leverage technology to enable all of the above.

A shift to advisory wealth

From that perspective, the investment landscape globally, and in India, is changing at a fast pace. As investors are becoming increasingly aware of the importance of financial planning and wealth building, they are no longer satisfied with cookie cutter solutions or transaction led relationships. They want holistic solutions that encompass customised advice, unique products, and the ability to transact seamlessly. This opens new opportunities for broking companies that have traditionally maintained purely transaction-based relationships with customers - an opportunity to usher in an era of advisory wealth.

WealthDesk is leading this shift towards advisory wealth from the front by creating an end-to-end platform-based ecosystem dedicated to the retailing of advised investment products. It has created a research + product creation + distribution stack that enables brokers to better engage with their existing customers (whether dormant or active) and attract new customers. Further, it empowers their partner ecosystem of Registered Investment Advisors, Research Analysts, Distributors, etc., to deepen their relationships with existing customers and expand the assets under advisory volumes.

What do investors want?

In the current investment landscape, first-time investors tend to tread carefully and are often unable to take optimal investment decisions on their own. Consequently, this leads to delayed or incorrect choice and a bad investment experience. Then there are the dormant investors who are either inactive due to past negative investing experiences or do not have the time required to do the necessary research. At the other end of the spectrum, there are seasoned investors who actively manage their portfolios and are yet unable to consistently generate above average returns. All of these investors can benefit from advised investment products like WealthBaskets available on the WealthDesk platform.

These WealthBaskets, that are created and managed by SEBI licensed professionals, are curated portfolios on top of direct equities and ETFs, that follow specific themes, strategies, and investment styles and can be managed either actively or passively. Thus, from passively tracked ETFs that provide stable returns to WealthBaskets that can outperform the market, there is an investment solution for every kind of investor. A broker can benefit from WealthDesk’s offerings in several ways:

Value based broking: The broker’s partner ecosystem can be empowered to switch from transaction to fee-based broking through their Distribution network. In addition to the wide range of WealthBaskets already available on the platform, advisors can convert their existing advisory and research capabilities to WealthBaskets and leverage the large scale online and offline retail distribution capabilities enabled through WealthDesk platform.

Re-activation of dormant / inactive accounts: Brokers will have access to a broad selection of advised analytics and products that can be offered to clients to maximize opportunities for re-activating or strengthening relationships with existing clients. Further, brokers can also convert their research views including intraday, technical, fundamental, sectoral calls into full-fledged products and make them available to their clients as WealthBaskets

ARPU expansion: A wider and more customised suite of products WealthBaskets that deliver better performance at lower costs with better experience is likely to better meet the needs of the investors. This, in turn, will drive the size of investment / users and provide holistic Wealth Management.

New customer acquisition: Acquire new broking accounts through the WealthDesk Ecosystem (WealthDesk partner RIAs, Digital Wealth Management Platforms without broking facilities)

In every industry there comes a time when firms find themselves at a crossroads where they can choose between surviving or thriving. In the broking space, to continue business as usual might ensure that you survive and live to tell the tale of disruption. However, to innovate and embrace solutions like WealthDesk will ensure that you thrive and lead the disruption from the front.

This is a partnered post.