In an increasingly competitive market, aggregators and broking groups are racing hard to be in pole position for brokers’ business. To understand the driving force behind brokers’ choices on aggregator groups, Momentum Intelligence, in partnership with The Adviser, surveyed brokers on what is needed for a group to motor ahead and what can be left in the pit stop. Annie Kane takes a look under the hood.
The importance of striking the right balance between what a broking group or aggregator provides and the commission they pay is crucial. According to the 2018 Momentum Intelligence Broker Group of Choice: Switching Aggregators report, run in partnership with The Adviser, commission structure is the number one factor that would make brokers leave their current group (41.4 per cent).
The Broker Group of Choice: Switching Aggregators 2018 report looks at the relationship between brokers and their group (whether an aggregator or branded group) and paints a picture of where these groups are succeeding, where there is room for improvement and what brokers think about the group as a whole.
Conducted during April and May 2018 across a range of sources including The Adviser’s database, the quantitative research asked participants to complete a self-administered questionnaire via an online survey portal. This year, there was a total usable sample of 468 brokers.
34.8% of brokers say they are “very satisfied” with their current aggregator group
While the majority of surveyed brokers appear to be satisfied with their aggregators/broker groups (62 per cent), there is a substantial proportion (22 per cent) who are dissatisfied and considering other options. The report also found that broker satisfaction tends to decrease over time.
46.8% of brokers say that they are “very satisfied” with their new aggregator after making the switch
The report found that more than half of broker respondents (52 per cent) have switched group at least once, but that just under 10 per cent of those that had switched were either dissatisfied or very dissatisfied with the new group once they did.
What a broker wants
Asking brokers to rate their current aggregator on a number of key operating areas, the research found that the groups excelled at three areas: compliance assistance, choice of lending panel and culture. Forty-five per cent of brokers gave their group 5 out of 5 for helping with the legal side of things, lending panel was given full marks in 42 per cent of cases and culture came in third with 41 per cent.
What would make a broker change group?
When considering switching groups, brokers rated software and technology (74 per cent) and trail portability (73 per cent) as “very important” factors to consider, with commission coming in as third most important at 64 per cent. At the opposite end, brokers placed little importance on areas outside of their core business. Offerings such as white label, risk or wealth products were found to have very little effect on the brokers’ consideration to move group.
This report makes it clear that while brokers are generally satisfied, they are looking for a broker group that has a strong technology platform with trail portability wrapped up with a foundation of a positive culture. And, given the ongoing reviews into culture, although there are hassles in switching broker groups, many brokers are looking to take the leap in the near future.