Artificial intelligence (AI) continues to gain traction as asset managers want to better understand advisor preferences and opportunities, finds a new report by Cerulli Associates.
According to The Cerulli Report—U.S. Intermediary Distribution 2024, 54% of asset managers are currently using or planning to use AI within the next 12 months as part of their advisor segmentation strategy.
Cerulli attributes the growing interest to changes in the distribution landscape.
“Where AI may have its greatest application when determining advisor segmentation and coverage strategy is through the identification of actionable data amid huge amounts of information,” says Andrew Blake, associate director at Cerulli. “The overwhelming amount of data asset managers have at their disposal is not very helpful unless it can be properly analyzed and implemented into sales processes. Identifying growing advisor practices and efficiently targeting them is a work in progress for most asset managers.”
Within the last five years, 79% of asset managers have made “substantial changes” to their coverage strategy due to new management (42% of asset managers surveyed), and because of distributions to alternatives (33%).
In fact, Cerulli believes more asset managers will utilize AI for the distribution of alternative investments, in an effort to target advisors. “Cerulli recommends asset managers explore AI use cases to ensure they are competitively using data to take a targeted approach to their coverage model,” says Blake.
Asset managers can begin incorporating AI into quality data inputs, Cerulli adds, which could provide personalized product recommendations and targeted marketing strategies for clients. Ultimately, the firm concludes that AI could be the latest strategy to help asset managers prospect and win over new advisory firms.
A growing number of firms are offering AI tools and features that can transform how advisors manage their workflow. Integrating artificial intelligence capabilities into software and services could recoup time for advisors wanting to maintain high service levels for clients.
Last month, digital wealth management and technology provider SigFig announced it was adding AI-powered assistance capabilities for advisors and their teams to increase efficiency, and LPL Financial recently revealed it is piloting a tool that applies AP through secured systems to analyze client data and generate customized insights.
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Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.
