A new piece of UK adviser research sheds light on the evolving demands intermediaries place on their platform providers as the clock winds down to the second biggest countdown of the year – the Retail Distribution Review (RDR).

With the Olympics set to only run a mere two weeks as of this Friday, the global sporting spectacular pales into insignificance (OK, that’s an overstatement!) compared to the UK’s RDR, which brings with it broad and lasting change, plus a range of challenges akin to competing in a Decathlon… well, kind of.

Olympic (bad) puns aside, three core topics will swing into view from January 2013… though some might argue this is the case already.

In short these are:

1. What aspects of the investment process will advisers retain in a post-RDR world and what aspects might be outsourced/insourced from third parties (the role of discretionary fund managers, the role of using managed portfolios).
2. The age-old debate surrounding active versus passive will fire-up further than it has been this year. What inroads can the passive camp (an oxymoron?) continue to make as it continues to debate the merits of investors holding quasi-trackers while being exposed to active charges. This will be a sliding spectrum mixture but RDR is potentially going to open up the market and making it easier for investors to know what their paying and for what, and whether that is alpha or beta.
3. Costs. Who will pay for what? The food chain in this industry is long and in some regards overly complex. RDR will see pressure on prices in some areas while present opportunities for growth in others. This will be very interesting to watch as the large, medium and small providers address the new lay of the land and the opportunities therein. Key questions will be ‘how big is the slice of pie?’ and ‘what slice goes to which part of the food chain?’

Generalities aside, below are some of the specific needs advisers have identified and can therein be gleaned from the 2012 CoreData Research UK Investment Platform Study.

• Platform and fund manager charges have become the top requirement for platform users this year, emerging from being the third priority in 2011.
• Trends from 2010 results show an increase of importance for a range of tools and services offered while showing a decreasing priority for ownership structure.
• The cost, fees and charging structure is the top single factor that would encourage a third (31.7%) of advisers to place more business in one platform over another.
• Advisers believe holistic financial planning is their typical client’s most common need.
• Better value, a simplicity of use and better reporting are widely cited reasons advisers choose to allocate funds through one platform over another – which hasn’t changed since last year.
• Advisers would most like to see full Sipps and other complex pension options (29%), on their platform(s); closely followed by annuities and income drawdowns (26%) – the latter was last year’s third most popular choice.

A series of gongs have also been awarded, with the winners to be announced in the press in coming weeks.

Platforms were benchmarked against 40 service level metrics and also their sized-related peers.

Firms were split into three core groups. The three groups were Emerging Platforms (those up to £1 billion), Medium Platforms (those with more than £1 billion but less than £10 billion) and Large Platforms (those with more than £10 billion).

The study covers six core topic areas:

1. Adviser attitudes/experiences towards investment supermarkets, platforms and wraps in the current market in relation to their business and customer needs.

2. Developing trends in attitudes in 2012 and previous comparable data sets to outline how the market is changing/has changed/ and is likely to change in future.

3. Segmentation after identifying three types of IFA based around the clients they service and creating distinctive needs, satisfaction drivers and expectations. Advisers are generally divided into three groups; those who focus exclusively on mass-market clients, those who focus on mass market/mass affluent and those who focus on mass affluent/high net worth.

4. Benchmarking of existing wrap/platform providers against more than 40-service based metrics in terms of adviser service experience.

5. A detailed statistical assessment of driver analysis, allowing groups to confidently understand all aspects of their functionality and service offering the critical combinations that lead IFAs to continue to conduct their business with certain groups.

6. A synopsis of the opportunities and challenges for the investment administration market looking ahead, and determining the critical and key factors behind future growth and success.