If they wish to change the tech ‘plumbing’ on which their platform is built, they can do so at any time without any involvement from the client – giving them full ownership of the technology stack and the client relationship.
The second difference, if you had not guessed, is operational. As the term suggests, when an advice firm or DFM chooses to operate their own platform, they will be operationally responsible for the day-to-day administration of the platform services.
In other words, it brings another, more total level of control to the overall platform experience.
Exploring the pros and cons
So which model is best? Well, as you would expect, there is no one-size-fits-all approach – what is right for one firm might not be for another. That said, each route has its pros and cons, as well as its typical use cases.
A simple white label approach might be suitable for those firms who only want cosmetic control of the customer journey and are otherwise happy with the traditional approach offered by third-party platforms.
The motivation here would be one of brand consistency – ensuring that clients can benefit from seeing a familiar name above the door. By the same token, though, firms who choose to do this will effectively be putting their brand on a service that they in no way control.
A more advanced ‘white label plus’ approach, meanwhile, might be right for those who want a bit more influence, but do not want to control the client relationship or do any of the heavy lifting. It might allow them to negotiate a better outcome for clients – be it through cost or service levels – but without taking on any additional responsibilities themselves.
But on the other hand, the fact that the platform is still responsible for all elements of service – and has the contractual relationship with the client – might be a reason in itself to explore an option that provides greater control.
Finally, operating your own platform might be a good option if you are a firm that wants to take more complete control of the customer relationship. Perhaps you are not happy with the service offered by traditional, paper-heavy platforms – particularly if it reflects badly on your own business – and want to improve the client experience by taking on the administration yourself.
Your rationale might be efficiency-driven, with you hoping to build a more efficient, sustainable (and affordable) business by integrating your platform with your existing business processes (rather than forcing them to fit around a platform).
