It’s clear, sell-side research services are evolving and what buy-side professionals are willing to pay for is narrowing, but that doesn’t mean all is lost. In fact, sell-side institutions have a unique value proposition: they have access to a vast amount of industry expertise and data. What they need to do now is leverage those factors for optimal monetization.
Create the optimal business model
A global one-stop shopping experience, offering full service across asset classes, with research being a supporting function for the enterprise can have significant implications for efficient research access, delivery, compensation structure and workforce.
Consider how digital disruption can be cut both ways
Rather than look at the negative impacts of digital disruption, it’s time to look at the positive. Blogs, social networks, micro-blogging services and message boards are becoming more important. Another opportunity would be incorporating new digital data sources for sell-side professionals to create customized research offerings based on styles and demands.
Tap into digital delivery
The buy-side wants the right information at the right time for global ideas with a local presence. Sell-side professionals can rise above the noise by creating targeted offerings based on client preferences which could also be incorporated into mobile, buy-side regulatory compliant interactive interfaces as a competitive differentiator.
Monetizing research data
Sell-side firms have vast amounts of historical and real-time market data, as well as other data streams. Applying advanced analytics to better understand how certain events affect or don’t affect asset prices creates an opportunity for trading idea recommendations, which in turn could drive revenue.
Monetization of research is possible, it just requires redefining the service. Thankfully, by considering market positioning, content and delivery methods, sell-side professionals can make incredible headway and turn the future around for this valuable service.
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