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ETF sales role is evolving says new report

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A report on ETF distribution entitled ‘Distribution 2.0: Revolutionizing Global ETF Distribution through Technology,’ from Blackwater Search & Advisory and FLX Networks finds that the role of the salesperson for ETF issuers is critical but is fast-evolving.

The firm writes that the report is based on interviews with Heads of Distribution, CEOs, COOs, and CIOs at firms in the US, Europe, Asia Pacific, and Latin America at ETF issuers representing USD1.7 trillion in assets under management.

Jillian DelSignore says: “Sales in 2023 is less about endless travel, buying lunch, and hawking product sheets.  It’s more about being a consultant, embracing technology, recognising client pain points, and pulling in resources to help advisors solve problems and build their practice. Reflecting this, one respondant in the ‘Distribution 2.0’ report even suggested a new sales title – Director of Resources.”

“Through extensive interviews we found that many ETF issuers are developing service models that take a full, 360-degree view of the client relationship by providing products, resources, portfolio tools, content, digital, and more to bring truly unmatched value to top clients,” says Michael O’Riordan, Blackwater founder.

Key findings of the US section of the report are that more firms have begun to use AI- or machine learning-driven technology to help sales teams target the right financial advisers to call and what to call about.

The value of data is extraordinary, growing, and a huge spend for all ETF issuers, the report says.  Data is widely used in segmenting sales calls and is now for the first time driving critical, senior level decisions about hybrids, internals, and for digital marketing. 

In the post-pandemic world ETF issuer-adviser meetings are no longer completely virtual, but they haven’t shifted completely back to in-person, either. Buying lunch is still required, but tech skills — data management, virtual engagement, portfolio construction, product analysis, and other diagnostic tools — must be part of salespeople’s daily work with advisers.

Digital distribution is the new internal, the firm says. Cold calling and screening can be replicated, even enhanced, through a digital strategy; the “traditional” internal / external model is evolving rapidly and firms are reallocating budgets to fuel the shift to digital, the firm says.

Despite big shifts, the sales role isn’t threatened by digital, the firm says. It is enhanced by making these individuals more productive and focused, and by improving the quality of leads and client engagement.

Content publishing – delivered multi-channel via blogs, web sites, social media – is critical for success in ETF distribution, the firm says.  Most valued by advisers is content that provides perspective on the markets or helps advisers add value to their business or clients, the firm says. 

Social media is integral to both digital and content, and is essential to spotlight expertise, build brand, and connect — with adviser clients both current and prospective.

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