Asset managers use data to make critical decisions everyday, and the success of your business depends on the accuracy and timeliness of your data.
Bad data, however, may lead to bad growth prospects.
Data comes from multiple sources— transfer agents, supermarket platforms, ETF platforms, sub-accounting firms, managed accounts, and more. This process increases the risk that data may be transmitted incorrectly, posted to your system in error, or simply lost in the transmission process. While many asset managers use data cleansing sales software, it may not be sufficient to create reliable and timely data.
Here are 7 ways bad data can lead to bad results:
Bad Planning for Firm Sales Goals
Your sales and marketing departments need accurate data to set sales goals, plan staffing, and to monitor results. Using the best technology won’t be useful, if the data loaded into the system is incorrect.
If your data is incomplete, your system is not providing a true picture of sales results to management. Not knowing which advisor placed a particular order, for example, leaves you unprepared to build your relationship with the advisors and grow your sales. In addition, a competitor with more accurate data may take advantage of sales opportunities that you miss. Bad data makes it far more difficult to reach your sales goals.
Bad Compensation Dollars for Wholesalers
Your wholesalers are managed and compensated based on the sales data in your system. A misclassification of channel and/or territory assignments due to incorrect data can lead to wholesalers being paid too little or too much.
If a high-performing wholesaler is incorrectly paid too little, the error will create frustration and confusion, both of which may impact the wholesaler’s performance moving forward. Your firm will also have to spend time and effort to recalculate the commissions, correct the payments, and communicate the changes to those who are affected.
Bad Sales Calls
Wholesalers are most productive when they can maximize their time in front of the most valuable advisors, and reliable data is critical for maintaining productivity.
Ideally, your salespeople should be able to access detailed information about their territories on a PC or mobile device. Assume, for example, that your representative is planning a visit to Pittsburgh, and needs to plan his sales activities. Your system should be able to generate a listing of the most important advisors, their contact information, and map each advisor’s office location.
Bad data may result in your salesperson calling on the wrong contacts. Instead of promoting your brand to your best prospects, they may schedule meetings with advisors based on stale or incorrect data. Your representative may call the wrong advisor to thank him or her for placing a trade, or reach out to an advisor who has left the firm or is deceased.
If a team of advisors moves to a new firm, your system must be updated to reflect the move, and provide current contact information.
Your representatives have a limited amount of time, and they must prioritize advisor contacts to work productively. Some advisors, for example, may need a phone call, while others may receive an email communication. Without good data, your salespeople cannot leverage their time.
These mistakes hurt your firm’s brand and damage relationships.
Bad Sales Campaign Monitoring
If you run a sales campaign, you need the ability to keep your entire sales and marketing team on the same page. Your wholesalers must clearly understand what you’re promoting, how to deliver the correct sales message, and they need the ability to prioritize advisors by territory. Bad sales data can make this process impossible to implement.
In order to start any campaign, you need to identify your target audience, and use segmentation to accurately customize your communications, including emails. Your messaging for a current client, for example, may be different than one for a prospect who’s never done business with you. Accurate data allows you to launch your campaign to right people, with the right message.
A sales campaign also requires accurate scoring analysis. Your wholesalers need to see the results of their efforts, and use data to determine the most effective ways to increase sales during the campaign. Using bad data may result in scoring errors, and your wholesalers may spend time with reps that are a low priority.
This entire situation lengthens your sales cycle and may require a bigger investment in sales and marketing costs to produce your desired results.
Bad Customer Retention
Successful asset managers grow sales by building relationships that generate repeat business over time. Your sales team cannot build those relationships without reliable data. With accurate data, your salespeople can thank important reps for placing a large trade and visit key relationships on a regular basis.
Sales data can also help you take advantage of a competitor issue. For example, assume that you’ve just learned that a competitor is closing their billion-dollar small cap fund to new investors. With good data, your salespeople can locate the largest producers for your small cap fund, so you can offer an alternative and potentially better solution. Your company’s sales efforts can solidify relationships with advisors.
Without the ability to build relationships, your firm will spend far more on sales and marketing costs to find new advisors who can place orders with you. Leverage your time by using accurate sales data.
Your firm may be making a huge investment in marketing costs to generate attention and get interest for the sales team to leverage.
Timeliness is also important if you’re going to market effectively. Data must be current. Assume, for example, that breaking news regarding your fund’s biggest holding has just been announced, and that you need to quickly communicate your analyst’s opinion to advisors who use your fund in client portfolios.
Your software must allow you to quickly access all advisors that use your fund, their contact information, and the salesperson assigned to each advisor.
Bad data decreases your return on investment in marketing technology. Incorrect email addresses decrease your firm’s ability to properly target the right prospects. A high spam count in digital marketing campaigns can lead to being barred from sending additional emails.
If you’re launching a new product, accurate sales data becomes even more important. You need to carefully analyze your target market for a new product, and you need clear and concise data to assess how well your fund is being launched. Bad data may make a new launch ineffective, costing you time and money.
Bad Legal Outcomes
Perhaps the worst outcome of using bad data is a compliance or legal issue. As an example, SEC Rule 22c-2 requires funds to capture and analyze data from financial intermediaries, including asset managers.
In order for a fund company to comply with the SEC requirements, the data they receive from intermediaries must be timely and accurate. If your firm submits data that is incorrect, you may create a compliance or legal issue for your customer, and damage the relationship with your client.
SalesFocus Solutions’ MARS Product and our related services provides solutions to overcome the bad data issues that many asset management firms experience.
by Jill Santandreu, Director of Professional Services