Affluent customers rate brokerages in terms of client service, value added. High-net-worth investors rate Schwab as the top discount brokerage in the U.S. in terms of customer service and overall responsiveness and Edward Jones as the top full-service brokerage, according to a recent survey by the Luxury Institute, a New York-based market-research firm.

Ameriprise Financial took second spot in the discount category and Smith Barney was the number-two pick among full-service shops, according to the Luxury Institute.

"The top retail brokers understand the importance of retaining wealthy consumers as the ease, availability and reliability of low cost online trading increases," says the Luxury Institute's CEO Milton Pedraza. "Highly skilled, knowledgeable, and dedicated personnel greatly enhance the customer experience and are reflected in these scores."

A question of trust

The Luxury Institute conducts two kinds of surveys. One has to do with the prestige of brand names. In those cases -- such as the survey on regional-bank affiliated wealth-management groups reported in FWR last month -- the Luxury Institute presents its online survey respondents with a list of brand names. The respondents are asked to rank the ones they recognize in terms of their impression of its prestige. The individual respondent's personal experience with the brands in question may not be a factor, nor is there an opportunity for a respondent to nominate a firm that's not on the list.

But in a consumer experience survey, the respondents -- in this case 1,650 Americans who report an average net income of $302,000 and an average net worth of $3.2 million -- are asked only about firms they've done business with in the previous 12 months. And only firms with a statistically significant number of recently past or present users among the respondent pool makes the list.

And in any case Luxury Institute survey results are weighted to match demographic and net-worth profiles for the same audience according to the Federal Reserve's latest Survey of Consumer Finances.

In addition to the four firms that placed first and second in the discount and full-service categories, respondents weighed in on discount broker-dealers Wells Fargo Securities, TD Ameritrade, Fidelity Brokerage Services, E-Trade, Banc of America and full-service brokerages Wachovia Securities, UBS Financial Services, Merrill Lynch and A.G. Edwards (which is slated to become part of Wachovia Securities).

For those brokerages they would not recommend, survey respondents most frequently cited broker unresponsiveness, biased recommendation, and a lack of overall trustworthiness. -FWR

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