With the end of year approaching and with many of us focused on setting the stage for a fresh start in January, here are five tips you can use to help strengthen your market segmentation matrix for PROD compliance in 2020.
TIP 1: Organisation, consistency, and regular updates are crucial
Have an organised approach, be consistent, and update your client segmentation matrix regularly to reflect any changes in your underlying business.
TIP 2: Show you’ve considered clients’ specific needs and objectives
Having different investment solutions for clients in different categories can help to demonstrate that your firm is meeting the regulator’s guidance for client segmentation (i.e. clients are segmented, not just in terms of how much money they have or what service they receive, but in terms of their specific needs and objectives).
TIP 3: Pick a platform that works well for your clients
It’s not necessary to have a multitude of platforms with each one addressing a specific need. You may find it's possible that one platform can meet the needs of all your clients, particularly if the client bank is straightforward or if the chosen platform can be flexible enough to incorporate the needs of all of the client segments.
TIP 4: Think hard about the suitability of service levels
Your clients are likely to have different needs at different times and it’s important to think about and document the different service levels suitable for each of the client categories.
TIP 5: Show how the solutions, platforms, and services can help clients
Communicating key issues clients commonly face and embedding this in the investment solutions, platform selections, and service offerings helps emphasize that the decisions being made are suitable for your target markets.
For more information about PROD and suggestions that could help your firm begin to fulfil PROD regulations, have a look these recent articles on the subject:
The value of investments can go down as well as up, and could be worth less than originally invested.
The views expressed in this blog should not be regarded as financial advice.
Standard Life accepts no responsibility for advice that may be formulated on the basis of this information.