PLANADVISER - September/October 2022 - 2

publisher's note //
A Future of 'Coopetition'
A
ttending our PLANADVISER National Conference
this year, I was struck by something
Randy Long, founder and managing principal
at SageView Advisory Group, said about the
evolution of his firm. Despite having previously
expressed the conviction that SageView would focus
exclusively on retirement plan clients, a few years
ago Long changed his mind. SageView now supplies
participant services and handles billions of dollars
in its wealth management division.
This shift is not exclusive to SageView. Many retirement plan advisory firms
now focus on wealth management and the participant relationship-something
that is discussed by our sources in this issue's cover story.
Why wealth management? Well, as Cerulli notes in its recent " Cerulli
Edge-U.S. Asset and Wealth Management Edition " : " ... the wealth management
industry largely has been insulated from the intense fee compression
experienced in other areas of the asset management and retirement industries. "
This means that wealth management relationships can be much more
lucrative for both advisers and recordkeepers than are the plan relationships.
It's no secret that recordkeeping, with its years of consolidation, is a tough business
and the reason some recordkeepers stay in it is not because they make a
lot of money but because the business is an entry point to selling additional
funds and products and services. This leads to some very competitive pricing
on recordkeeping services.
As plan advisory firms increasingly offer wealth management, it will
be interesting to note whether they might find themselves following similar
pricing conventions and charging lower plan-level fees with the anticipation of
winning other assets from the participants.
" As a result, " according to the Cerulli report, " several [defined contribution]
recordkeepers, retirement aggregator firms, and traditional wealth management
firms are seizing opportunities at the intersection of DC and wealth
management by creating synergies across these two business lines, sourcing
wealth management relationships from their DC plan clients. " The flip side
of all of this is that, as advisory firms and aggregators build out their wealth
management capabilities, they are now competing with their recordkeeping
partners who are looking to capture the assets of those same DC plan participants
with their rollovers or other assets.
The report spoke about this concept, calling it " coopetition. "
I have a feeling it's going to be a difficult balance as these two groups-
providers and advisers-will have to continue to work together to support the
plan sponsors and will also be simultaneously competing for billions of dollars
in potential retiree client business. What that means for long-term mutual
support and partnerships remains to be seen.
I also think the other side of this is interesting-those advisers and consultants
who aren't going after participant assets. Those who are not moving in
this direction have told me they can't seem to accept what they see as the
inherent conflicts of interest that come from moving participants from a low
or lower-cost retirement plan to more expensive wealth services offered by
the plan advisory firm. Time will also tell whether the SEC's Regulation Best
Interest may influence how these services evolve or how advisers frame their
wealth management services to plan participants of existing clients.
Where do we go from here? It's unclear exactly what the future of participant
services will be in our industry. I look forward to watching how the quest
to win participant business evolves. -Alison Cooke Mintzer, Publisher
publisher: Alison Cooke Mintzer
Alison.Mintzer@issmediasolutions.com
creative director: SooJin Buzelli
SooJin.Buzelli@issmediasolutions.com
managing editor: Judy Faust Hartnett
Judy.FaustHartnett@issmediasolutions.com
editorial staff: Zachary Barnes, John Manganaro,
DJ Shaw, Karen Wittwer, Noah Zuss
contributors: Beth Braverman, Michael Katz,
Bailey McCann, Ed McCarthy, Judy Ward,
surveys & research: Kimberley Gonzalez-Quiles
design & production: Donna Bien-Aimé,
Alanna Jacobs, Maria Kofman, Samantha Yu
design contributor: Cherese Rambaldi
art contributors: Melinda Beck, Tim Bower,
Harry Campbell, Alessandra De Cristofaro,
Gérard DuBois (cover), Eric Hanson, Matt
Kalinowski, Julian Posture, Irene Servillo,
Katherine Streeter, Anja Sušanj, Klaas
Verplancke
strategy & operations: Michelle Lamison;
Melissa Groccia, Rebecca Moore, Jackie Scott
commercial director: Rob Reif
Robert.Reif@issmediasolutions.com
advertising sales: Katie Bacon, John Bennett,
Christopher Janos, Bill Murray
conferences: Carol Popkins; Katie Campbell,
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accounting operations: Mayrillane Bahi,
Ruth Fissaha, Ricky Kostik
technology operations: Darrell Cheng, Bhakti Patel,
Jigar Patel, Dexter Reaves
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president and chief executive officer: Gary Retelny
chief financial officer: Allen Heery
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PLANADVISER - September/October 2022

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