The Aviva for Advisers platform proposition is aimed squarely at mid-market clients, and is designed to provide advisers with a simple, comprehensive and cost efficient way of servicing the needs of this segment of their client base. Importantly, Aviva does not define “mid-market” by the amount of assets to be invested, as we do not think that approach works for everyone.
As Phil Ralli, senior marketing manager for platform proposition strategy and development explains: “All the work and development over the last 18 months is based on what advisers are telling us they typically need to provide the right sort of service to mid-market clients.
“The way we define mid-market clients is as people who are cost conscious and have straightforward planning needs that are typically met by mainstream products and fund solutions.
“A strong message that has come through from feedback we have had from advisers is when they approach segmentation of their clients, they can do it in very different ways. One adviser might see a mid-market client as being one that has up to £50k to invest.
“Another might see it as someone who has substantially more funds. We want to avoid pigeonholing clients into a specific range of values, as we do not think that approach works.”
Instead the team is focused on working out what those sorts of clients are typically going to be looking for and providing advisers with the right level of support to enable them to meet those needs. This means, in the first instance, making sure the platform is simple and easy to use, stripping out features that are more suited to higher net worth clients and that simply adds cost and complexity for mid-market users.
“Because we are aiming at the mid-market, we are never going to be a platform that has the most sophisticated or complex set of asset types or planning tools available,” Mr Ralli says. “We are very much focused on what the mid-market needs rather than putting additional bells and whistles and facilities on the platform that may never get used.”
At the heart of the proposition are three product wrappers: a stocks and shares ISA, a pension and a general investment account for collectives business. For those, there are more than 2300 investment funds available, ranging from equities, exchange-traded funds and investment trusts through to commercial property, which can be invested in through the pension product. As well as keeping costs low by removing unnecessary ‘bells and whistles’, clients can benefit from a very strong choice of investment options.
Mr Ralli says: “From the research that we have done we know cost is not the only factor under consideration for mid-market clients when it comes to choosing a platform, but it is very important. As such, for our ISA and collectives business we have a flat platform charge of 25bps, which we think is very competitive compared to other platforms. It is designed to reflect the fact that advisers want to be able to carry on providing advice in an affordable way to as broad a range of clients as they can. If we are going to be successful in offering our platform to mid-market clients, our platform has to be as affordable as we can make it.
“Meanwhile, pensions charging is as low as 20 bps and is tiered depending on the amount of investment into the portfolio. When compared to other pension propositions available on platforms, we think we are very competitive and hitting the right spot for the mid-market.”
The pension product has been the subject of a raft of changes and reinvigoration over recent months and has been redesigned so there are three different levels available within one product. Effectively, clients are able to choose the investment and asset ranges depending on their investment needs, attitudes to risk and investment objectives and advisers are supported in helping match the client to the optimum level to meet their needs at various stages of the retirement planning journey.
“We thought it was a sensible change to make and we have been very pleased with the way it has been received by advisers,” Mr Ralli says.
“It was launched in December and in the first quarter of this year we have seen very substantial growth into the new pension product. In fact, we saw growth across the platform as a whole, but it was visible in that area in particular.”
Mr Ralli believes part of the reason for the platform’s success has been the excellent service proposition that supports it. In that respect, its life company heritage is a real advantage, providing it with a broad distribution team across the country that is available to service individual IFAs’ needs.
“We have got a team of around 80 consultants who are focused primarily on providing support to advisers around the use of our platform,” he says. “The field sales support we are able to offer is quite distinctive compared to some other platforms. We have also got a team of platform specialists and they work to support the distribution team and their job is to help advisers as they use the platform for the first time. We know there are many common features across platforms, but we also know that the way in which an adviser, para-planner or a member of support staff for an IFA uses a platform and processes business can vary and we are committed to providing support to make sure they are getting the most out of our platform.”
Aviva for Advisers has also invested time and resources on developing its online proposition, ensuring the website is easy to use and has all the functionality advisers need. A recent development in the offering is the decision to integrate the Aviva for Advisers portal, bringing the platform into the portal.
“One of the distinct things we have got as a provider is that we have both traditional life company products, but also a platform proposition as well,” Mr Ralli explains. “We are the first to bring those together so they are available to advisers through one route, rather than having to go in one direction if you want platform business and another if you want access to more traditional products.
It went live in the middle of March and since then we have had more than 500 new advisers start to use that service, which is a strong indicator that it is something that is important to advisers.”
Mr Ralli concludes: “We have been absolutely delighted in the rate of growth we have seen in the platform over the last 18 months. We have just gone through £1.6bn in assets, so while we are one of the smaller platforms, we are one of the fastest growing. That is a clear indication that we are getting the contents and the pricing and the pitching of the proposition right for the people we are trying to promote it to: mid-market clients. We are now looking ahead to how we can improve the proposition further, while keeping focus on mid-market client needs.”
Plans for the remainder of this year are mainly focused on the new platform regulations that are due to be implemented by the FSA, which will necessitate changes across the platform industry as a whole.
For Aviva that includes continuing its transition towards clean share classes, working with fund houses and fund providers to make that possible within a reasonable time frame.
“We have also got plans to broaden our pension drawdown proposition,” Mr Ralli adds. “At the moment we offer phased drawdown but we are looking to move to offer flexible drawdown as well. We know it is increasingly important to advisers to be able to access the full range of options so, even in the mid-market space, we need to make that possible.
Other plans include adding term deposit cash vehicles on the platform, again responding to feedback from advisers and a demand from mid-market clients for low-risk investment options. The team is also continually looking for ways to refine the technology that supports the platform, ensuring it remains cutting edge and meets advisers’ requirements.
