Mother Merrill Capitulates: Good News for Fund Distributors?

by Matthew Franey

As distribution organizations in the asset management industry are all too aware, navigating blind-spots in sales data can be a tricky proposition.  “Know your customer” remains a fundamental tenant of any effective marketer regardless of the product or service being offered, and achieving this level of understanding depends almost entirely upon accurate, timely, and actionable data.  In an industry famous, and sometimes infamous, for its lack of transparency, acquiring such data can prove to be especially vexing for even the most seasoned sales and marketing executives.

This situation does appear to be changing, however, as evidenced by a recent watershed announcement from the new head of Bank of America-Merrill Lynch’s mutual fund platform.  Merrill Lynch, or “Mother Merrill” as it has been affectionately nicknamed, remains the single largest broker on Wall Street, reporting over $2 trillion in assets under management across their 16,000+ advisers according to their 2014 annual report, and has traditionally been viewed as an especially challenging platform for data transparency by both the fund industry and the data management companies that support it.  As the consumption habits of investors continue to evolve, Merrill Lynch and other large asset allocators seem to be getting wise to the fact that the advisers driving their fee-based businesses can be most impactful in raising assets when provided with enhanced tools and resources direct from the asset managers, as together they can most effectively “tell their story”.

An absence of transparency makes identifying and executing upon such collaborative opportunities between managers and advisers both difficult and inefficient.  Indeed, asset allocators only serve to benefit their bottom lines from an increased level of transparency, as permitting the fund companies on their platforms ready access to sales and asset data serves the dual role of not only enabling nimble execution of sales opportunities but also reducing the carrying cost of assets held under management by minimizing turnover as managers are better equipped to insert themselves at critical points in the investment cycle.

While it remains to be seen exactly how Ms. Bolton will execute on her vision, and pockets of opaqueness still remain in other channels of distribution, asset management executives should view this news as a positive sign that the new, data-driven environment in financial services is slowly breaking down the traditional paradigm of protecting access to advisers.  Enhanced data transparency with respect to fund distribution seems to be an all too rare win/win for both managers and intermediaries alike, and will ultimately prove beneficial to both the financial services industry at large and the investors they serve.

For more information on how enhanced data transparency, and our data management solution SalesStation™, could potentially impact your specific distribution efforts, please get in touch with us.


Matthew Franey
Director of Business Development
262-834-0080 x218