Colonial First State’s FirstChoice master trust has opened a new front in the battle for platform supremacy by signalling its intent to tackle more high-end rivals head-on following the launch of a new service to advisers.
Colonial general manager of product Brian Bissaker said FirstChoice, which has amassed $8.5 billion on the back of its low fuss, low fee credentials, would attempt to compete directly with more expensive full service platform providers, such as Asgard, MLC and Macquarie, once the new service goes live next week.
The service is a new reporting mechanism for advisers, which allows them to create detailed online reports for clients who use FirstChoice — a facility Bissaker said is typical of more high-end, full service platforms.
Bissaker acknowledged the service was not ground-breaking, but said it sent a strong signal about Colonial’s intentions in the platform market.
“This is stuff that everyone can build, so it is not necessarily what we see as our competitive advantage,” he said.
“But it shows very strongly that this platform is getting into the realm of the MLCs, the Asgards and the Macquarie Wraps.”
Bissaker added that Colonial was motivated by a need to make inroads into the high service end of the platform market as the account balances of FirstChoice clients increased.
However, he rejected suggestions Colonial would increase the number of investment choices on FirstChoice — a key competitive advantage of full service platforms.
“We won’t be doing that at this stage, because we want to maintain our cost advantage,” he said.
Bissaker said Colonial could absorb the cost of the new service to advisers, without feeling the pinch on fees.
“We are making more than enough to be able to develop the platform and still stay competitive on fees,” he said.
