This publication recently asked Mercer about its Mercer Advisor Portal service, known more snappily as MAP. What is it and what does it do for the wealth management industry?

This publication recently asked Mercer, the global consultancy, about its Mercer Manager Analysis Portal service, known more snappily as Mercer MAP. What is it and what does it do for the wealth management industry? We spoke to Cara Williams, who is global head of wealth management and technology solutions at Mercer.

What led to the creation of MAP?

Mercer Investments has been providing various consulting services to financial intermediaries that service the end investor for a number of years. For example, the Mercer brand is virtually a household name with investors in Australia.

One of the services we have been providing to these organizations has been subscriptions to our proprietary research database, Global Investment Manager Database. One thing lacking in this tool for this client base was retail/mutual fund data and so we took a strategic decision to collaborate with a specialist data aggregator and technology provider to incorporate this.

After a lengthy selection process, we chose London-based FE, for its robust data validation processes, its creative development team and adaptability. FE worked with the Mercer development team to create MAP Head Office (MAP) using their FE Analytics tool as the core. Mercer Manager Analysis Portal (MAP) combines FE’s comprehensive data library with Mercer’s qualitative research and ratings, and delivers it through an online analytics tool. We have also developed a front-office version, designed to sit on advisors’ desktops, which can be fully customized by head office.

When was it set up? Which markets does it now cover?

Both the head office and front office versions of MAP were launched in Q4 2013 and now cover funds available in UK, US, Asia and Europe. An Australian version will be launched at the end of this year and we will seek to continue to develop the asset class coverage and regions as we grow.

What does MAP do?

MAP allows a central manager/fund selection team to seamlessly access Mercer’s vast library of investment strategy research and ratings alongside the relevant retail/mutual fund performance and information. The fully web-based tool provides screening and charting options as well as custom report building functionality.  

With FE’s input we have also developed a front office version of MAP aimed at the private banker or client-facing advisor. It allows the product team to control the guided architecture fund recommendations and model portfolios, along with providing more limited filtering, charting and reporting options than the head office version.

The beauty of this tool is its fully customizable functionality, content and calculations, along with client branding, which can all be delivered in three weeks. A great addition to the suite of tools is now available to sophisticated wealth managers.

How can wealth managers use it? Can you set out what the benefits are to the industry in having this service?

I think for many years the wealth management industry has used retail fund data and quantitative screening methodologies to short list funds to then take to the next step in their process.

This normally discounts funds which have a short track record or minimal assets under management. By using forward-looking qualitative research, a fund selection team can capture more ideas to perform further due diligence on.

Most fund selectors will then send request for proposals to the investment manager and analyze the responses before setting up face-to-face meetings to understand the investment process in more depth.

With MAP, a user can still perform the quantitative screening but can also use Mercer's research, rather than go through the process of sending out RFPs for the managers to complete, thus saving immense amounts of time and cost, as well as having an independent and informed due diligence report at the fingertips of the user.

Mercer believes that it is the first to provide this level of institutional quality, forward-looking qualitative analysis on funds, which has traditionally only been used by institutional investment consultants and investors. Bringing this level of analysis to any organization adds a further layer of governance and additional security for the end investor.

Who would you say should be using MAP, and why?

Any financial intermediary who services end investors and performs their own qualitative analysis of funds should think about using MAP. Our clients have told us that having the independent opinions on products from Mercer's 100-plus experienced researchers via MAP provides a level of resource that cannot be recreated internally without considerable expense.

Who are your competitors in this space? Is what you do unique? If so, what is its unique value?

We believe that Mercer is the only organization globally that delivers comprehensive, independent due diligence on funds via a retail data and technology platform.  However, we see that many of our potential clients are typically using Morningstar for their data and technology needs.
We believe that it is important for intermediaries to have access to quality research in order to select the best investment options for their clients, rather than basing their recommendations on past performance. MAP combines our institutional-quality research with retail data and allows advisors to utilize both in their decision-making process.

The US, UK, Switzerland, Hong Kong, Singapore and Australia are priority markets for us in 2014 and we will be adding to our existing impressive list of wealth management clients with MAP subscriptions.

What was the most challenging part of getting the MAP service up and running? What is the most important thing you have to do on an ongoing basis?

The most time consuming part of the project was undoubtedly the mapping of the retail funds to the investment strategy in our proprietary database, GIMD. I have to again give thanks to the investment managers and the Mercer team for so diligently completing this exercise.  

Why do you think now is a good time for the MAP service to be offered to clients?

With the ever-increasing challenges faced by financial intermediaries from the regulators, and also from investors, we believe now is the perfect time for the industry to have such a tool available. All we are hearing from private banks is the need to reduce costs and reduce their risks.  MAP allows them to tackle both with minimal additional investment.

Given the global nature of our investments business, our research team and the data at hand, we see interest from all regions.

Can you remind me of the recent key hires at Mercer in the wealth space. Any more hires likely?

We have hired Steven Seow from Ernst & Young in Singapore, Marieke de Roo, from S&P in London and Ryan Hokanson from Morningstar in Boston, MA. They have bolstered our team dedicated to this client segment.

Are there other points you would like to make?

MAP is just one of the developments within our wealth management business.  Last year we also launched High Volume Research, which allows our clients to screen, in a qualitative way, a large number of funds that may be sitting on an advisory platform or buy list. The two new services along with our consulting and fund building capabilities provide a completely unique set of services in the market place.