Investors group inc. is taking the road less travelled as it secures its dominant position in the country’s financial services market.

Unlike many of its competitors, the Winnipeg-based company isn’t single-mindedly pursuing the high net-worth client. Instead, it has set a considerably wider target — pretty much anyone who requires financial services.

Murray Taylor, president and CEO, says Investors Group has not carved out a niche in any particular area. The high net-worth segment doesn’t hold any special attraction, he says, because the company has always targeted, and will continue to target, the majority of Canadians in terms of financial and geographical breakdown.

“Whenever companies start wanting to go after clients [who] have so many hundreds of thousand, or millions, of dollars of investable assets, they leave a lot behind in terms of the future of their businesses and future clients,” he says.

It is a strategy that has resonated in the market. Investors Group recently surpassed the $53-billion mark in assets under management for the first time in its history. As of March 31, AUM was $53.8 billion, vs $45.5 billion a year earlier, and $42.7 billion in 2004. IGM Financial Inc. , which owns Investors Group as well as sister companies Mackenzie Financial Corp. and IPC Financial Network Inc. , boasts AUM of more than $103 billion. IGM is owned by Montreal-based Power Financial Corp. , which also owns insurance giant Great-West Lifeco Inc. . (Great-West encompasses Great-West Life Assurance Co., London Life Insurance Co. and Canada Life Assurance Co. )

Taylor says Investors Group is very conscious of the age of clients — those in the 45-65 age group — who butter its bread. Not surprisingly, the company is making sure its consultants are well educated to serve that group.

“We’re very conscious of the fact they’re not like their parents,” he says. “Retirement is often the pursuit of new passions, the start of the rest of their lives — as opposed to the end of their lives.”

Despite having been one of the dominant mutual fund players in Canada for several decades, Investors Group’s business has become increasingly diversified in recent years. In 2005, for example, it had sales of insurance products, as measured by annualized premiums, of $33 million; and the number of policies sold per consultant rose to 8.6 from 8.2 in 2004.

Mortgage originations increased by more than 18% in 2005 to 9,259 and the dollar value of these mortgages jumped by 28.4% to $958 million. Finally, as of the end of last year, 90% of Investors Group consultants had incorporated its banking products into their financial planning practices, up from 75% just 12 months earlier.

Through its partnership with Montreal-based National Bank of Canada, Investors Group offers savings accounts, preferred savings accounts, loans and credit cards, as well as credit and investment loans.

Investors Group has also expanded its insurance partnerships in the past two years to include product offerings from Manulife Financial Corp. , including its Clarica and Manufacturers Life brands, and Sun Life of Canada.

Arguably the biggest driver in Investors Group’s growth has been the expansion of its consultant network, the pipeline through which its mutual fund and other business flows. At the end of 2005, the number of consultants flying the Investors Group flag had risen to 3,668, a jump of more than 14% over the previous 18 months and the highest level since peaking at 3,774 in 1999.

Taylor credits the growth to strategic changes made in recent years, such as boosting compensation and consultant support while lowering management expense ratios on its funds.

Equally important is the company’s ability to manage its consultants. Taylor says the number of managers who oversee Investor Group advisors grew by 15.9% in 2005 at its 115 financial planning centres across Canada.

Investors Group’s exclusive sales force is one of its distinguishing features, Taylor says. Representatives are trained to sit down with clients and conduct exhaustive diagnostic reviews of their financial positions. “Our people ask for two to three hours of someone’s time,” he says. “It’s not a ‘By the way, would you like to buy some mutual funds?’ approach.”

Despite its large consultant network, the company isn’t running out of potential candidates and continues to find plenty of interest across the country. “We’re literally from Yellowknife to Windsor, Victoria to St. John’s,” Taylor says.

@page_break@Because Investors Group typically doesn’t poach advisors from competing firms, it is able to find good people who cross over to the financial services field from other walks of life. “We’ve had retired school principles join us, for example,” he says. “They have phenomenal relational skills, problem solving abilities and technical abilities. They bring a maturity — perhaps they’re 52 years old — and they have a community presence.”

Taylor acknowledges the company remains one of the few financial services firms in Canada to focus on hiring rookies rather than luring experienced advisors away from other companies, often by dangling a sizable cheque in front of them.

Make their own decisions

“It is very rare that consultants leave us over economics. Ultimately, consultants have to make their own decisions about their future and what they want to do and how they can best do it,” he says.

“We want to make sure we have a relationship with them that is very strong from a support and historical values point of view” he says. “We want people thinking, ‘This is the kind of organization I’d like to be with; these are the kinds of leaders I’d like to be working under, and this is a company that will help me and my clients into the future’.”

A big part of that future will no doubt involve mutual funds, and Taylor says the company’s core business has completely recovered from the prolonged period of net redemptions just a few years ago.

Taylor was tight-lipped about any possible acquisition activity by IGM, of which he is co-president and CEO. But he was clear any companies on its radar screen are located north of the border, unlike its sister company, Great-West Lifeco, which is actively scoping out opportunities in both Europe and the U.S.

“I’m out there with the Canadian flag during my speeches to our people. That’s who we are and that’s what we’re about,” he says.

Acquisition or no acquisition, Taylor acknowledges Investors Group faces a number of natural challenges in continuing to do what it does — bringing new people in, training them and sending them out into the field — and it’s not about to take anything for granted now that the rough patch is behind the company.

“We have to continue to be sharp. You can’t predict investment markets. But we know they’re going to get bouncy from time to time. We’re not in any way preparing our business or people in such a way that the markets have to grow forever. We’re very much into a message of diversification, managing risk and helping our clients do that,” he says. IE