Six important things I learned about LPL at its focus11 conference in Chicago

Lisa’s note: It was the first time LPL Financial opened its doors to the media at its conference this week in Chicago’s McCormick Place, which drew more than 5,000 attendees. There were tight restrictions on what the press could see and do and even on the amount of time we were allowed to attend the conference. See: LPL opens focus11 to reporters for first time – with provisos. But on the Monday morning we were there, company officials discussed a number of important initiatives.

The big-ticket news item to come out of this week’s focus11 conference is that LPL is slashing its transaction fees for advisors by 40% for equities and ETFs and that the company is paying for a one-year membership to the Financial Services Institute for all of its advisors. See: What’s behind LPL’s decision to slash its ticket charges for advisors.

But LPL leaders also addressed other hot topics.

“When we were smaller there used to be three or four things we’re rolling out,” says Bill Dwyer, president of sales and marketing. “Now, we literally have hundreds of improvements.”

1. LPL focuses on hybrid platform

LPL Financial announced that it intends to add improvements to its popular hybrid platform but doesn’t plan to build an RIA-only platform. However, advisors who have pure RIAs can and do use LPL’s hybrid platform.

“We’re not getting any push for being pure-RIA,” Dwyer says. “It’s all about the hybrid platform. In 2008, we were heading down that path to a pure RIA platform, but the trends have driven in the opposite direction. The real drive we see is hybrid RIA.”

2. Advisors free to follow Ron Carson

Earlier this year, LPL’s former No. 1 advisor Ron Carson shocked the industry when he announced he was leaving LPL to forge his own RIA. When speaking to the media, LPL executives maintained that other advisors are welcome follow Carson’s lead and open their own RIAs. See: LPL’s biggest rep, Ron Carson, will convert his firm to an independent RIA. See: Ron Carson quickly sees benefits of converting his practice to an RIA.

“We’re happy to have him do this,” says CEO Mark Casady about Carson’s decision. “There’s no doubt that he’s no longer LPL’s No. 1 advisor, but the economics with Ron are the exact same with us.”

Although Casady believes many advisors are steering away from becoming their own RIAs because of the compliance costs, he says that advisors can become pure RIAs under LPL’s platform, if they choose to do so.

“A lot of it is compliance-driven and that’s a big factor,” Casady says. “That’s why we have choices for advisors and wanted to avoid a one-size-fits-all marketplace.”

Bill Dwyer: We’re not getting any
push for being pure-RIA. It’s all
about the hybrid platform.

3. Advisors have jumped on social media bandwagon

Earlier this summer, LPL announced it is partnering with Erado Message Control Solutions of Renton, Wash. to allow advisors a mechanism to screen their social media posts. LPL says that nearly 3,000 advisors have signed up to use the system. Most are using it for LinkedIn and Facebook and some for Twitter. See: Cambridge, Commonwealth vault advisors into social media; the boost is mostly free, for now.

4. LPL pushing rollovers

LPL is also finalizing an initiative aimed at helping advisors capture rollovers, Dwyer says. The company plans to utilize software aimed at helping advisors capture rollovers from two million participants in 25,000 plans.

The company has systems in place to alert advisors of potential rollovers. The employers keep track of data on when employees are planning to retire or leave the company. Typically, participants roll over those assets and now LPL is trying to ensure that advisors can capture those rollover dollars rather than lose them to a firm like Fidelity.

5. Access to top brass

Responding to feedback from advisors who said they wanted some face time with Casady, Dwyer and other executives, LPL bigwigs were front and center at the exhibit hall during the hours it was open, ready and available to chat with attendees.

6. LPL responds to market madness

At 7:15 a.m. on Monday, 300 advisors at LPL’s focus11 conference crowded into a room to hear industry insights from the company’s research team. An hour later, advisors cheered when LPL became the second company this year to open the Nasdaq remotely.

Those cheers didn’t last long. As the market rapidly spiraled into all-day free-fall, with the Dow Jones Industrial average plunging 635 points, it became crystal clear that attending traditional advisory training sessions would take a distant second place to getting pertinent information about the markets.

To keep advisors abreast of the volatile situation, LPL Financial added 200 computers for advisors to use as well as additional television screens. Company leaders announced market updates throughout the conference.

“While we look forward to the beginning of the trading day this is a very unique experience. We find ourselves in highly unusual times,” Dwyer said on Monday morning minutes before the markets opened.

The company held these research meetings every morning. On that Monday morning, the research update was so jam-packed that advisors standing and sitting on the floor. Some couldn’t hear what was being said and walked away.

One of most valuable things you do for your clients is attend these kinds of things,” Dwyer says. “It’s times like these where you have to continually show your value to clients.”

This story was changed post publication to reflect that pure RIAs can use LPL’s hybrid platform.