Continued client segmentation twinned with a decrease in average investable assets could result in the advice gap widening, according to Schroders research.
The investment manager's annual adviser survey showed half (51%) of the 250 respondents already segmented their clients based on size or revenue. This was up from just less than half last year.
A fifth (20%) of advisers, meanwhile had plans to segment their clients, which was up from around 14% last year.
In 2016 two-fifths of respondents said they had no segmentation plans, however, this was down to a third this year.
The number of advisers who said they offered different levels of service according to client size or revenue went up from 80% in 2016 to 90% in 2017.
More advisers had also formally asked ‘smaller' clients to leave their practice - going up from a fifth (20%) last year to more than a quarter this year. Half of advisers surveyed had asked clients with assets of less than £50,000 to leave their practice in the past year, which jumped from about a quarter 12 months ago.
Schroders found, however, the average client size had gone down in the past year.
The number of advisers with clients with £201,000 or above had dropped from three-quarters to about half.
Clients with average assets of between £101,000 and £200,000 were more common this year, making up more than two-fifths of client numbers this year compared to less than a fifth in 2016.
The majority this year said £50,000 was the minimum asset size for new clients, while a threshold of £200,000 accounted for the majority in 2016. In 2017, this had dropped to just over a fifth, who cited £200,000 as their minimum asset size.
Schroders co-head of UK intermediary James Rainbow suggested continued client segmentation and greater minimum asset requirements may widen the advice gap.
What's more, fewer advisers said they offered execution-only services this year - falling from more than a third in 2016 to more than a quarter in 2017. Some 98% of respondents also said that they did not intend to offer execution-only services in the future.
"We've moved from transactional-based sales to a holistic financial planning service," said Rainbow. "There's more of a focus on the value of advice than on being an investment manager."
At the same time, three-quarters of advisers perceived technology as an opportunity to offer better services to clients, rather than as a threat to their business.
"You would assume the execution-only and technology findings to be closely linked," commented Rainbow. "However, it seems advisers view the role of technology acts as an enabler rather than a way to take the business into an entirely different segment. One of the barriers to advice is the labour intensive process and the fact that it does not have natural scale."
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