How to succeed (and fail) at marketing as an asset manager

Words:Alan O'Sullivan
Photography/Illustration:Peregrine Design Team
Peregrine and Cerulli Report

Peregrine Communications contributed to a report on global trends in asset management marketing practices by Cerulli Associates.

Here is our contribution to the report. If you want to dig down into the numbers, please click to purchase the full report here.

 

1. Marketers’ key failings

The most common mistake asset managers make in their marketing campaigns and overall communication practices is to fail to differentiate themselves from their competitors and the wider investment management market. This makes it extremely difficult for the end investor to judge the manager’s value—even if the content of their communications is compelling.

For example, a Peregrine study of 100 asset managers’ digital presence across Europe and the US found that managers tend to use the same 10 terms in their brief “elevator pitch” descriptions of their businesses: global (34%), long-term (32%), innovative (24%), leading (20%), experience (13%), independent (13%), expertise (12%), diversity (11%), values (11%), and responsible (10%).

Managers tend to use the same 10 terms in their brief “elevator pitch” descriptions of their businesses.

Asset managers often use generic descriptions even if their business is highly specialized. For example, we found one manager that mainly focuses on mid-term European credit describing itself as an international, long-term, multi-asset manager.

Another key mistake is that managers sometimes focus on promotional content or “market commentary” in their marketing and communications. The former has limited resonance with investment journalists and investors; the latter is often given without educational context, meaning anyone other than highly sophisticated investors will find it difficult to engage with. Using website content as a proxy for overall marketing content, we found that 56% of the websites of the managers in our study contain mostly promotional material and 62% focus on market commentary. Only 14% of the websites contain truly educational, varied content.

Only 14% of the websites contain truly educational, varied content.

Websites that mix all three types of content have a much lower “bounce rate” (a measure of investors who log on to a manager’s website and immediately leave) than ones that focus purely on market commentary or promotional content: 16% compared to 36%.

A third failure is that asset managers are not using digital resources effectively. Only 9% of managers use video to communicate their brand and strategy, even though website metrics show that video content provides the highest level of engagement with investors. In addition, although many of the asset managers studied have a presence on Twitter (80%) and LinkedIn (94%), only 60% post to Twitter frequently and 42% post to LinkedIn frequently. This calls for a change of approach, because investors tend to engage with content more frequently on LinkedIn (40%) than Twitter (23%). It makes little sense to build a follower base of investors on social media, but then fail to engage with them on a regular basis.

 

Peregrine Cerulli 01

 

2. Standing out from the crowd

The key ways for asset managers to stand out in terms of their marketing communications are, in order of importance: differentiating their brand, providing educational content, and embracing digital marketing. We are seeing the role of head of content appearing more regularly at asset management firms. In the UK, AXA Investment Management, Legg Mason, and Schroders have all created and filled this post over the past 18 months.

Roadshows can be an effective way for managers to raise their profile through face-to-face investor engagement. A differentiated brand with a cogent, concise investment strategy—clearly communicated in highly visual pitch presentations—is the key to success in this area.

Managers’ reticence to use Facebook as a social marketing channel seems justified, but they are definitely not making sufficient use of YouTube.

Social media should be at the core of asset managers’ marketing efforts and firms should consider having a specialized team. Our study found that social media channels are already playing a significant role in managers’ marketing efforts. Of the managers in our study, 94% are on LinkedIn, 80% are on Twitter, 70% are on YouTube, 56% are on Facebook, and 33% are on all of these social networks.

However, the proportion of firms that frequently post to these channels is somewhat lower: LinkedIn 42%, Twitter 60%, YouTube 9%, and Facebook 25%. The percentages of asset managers’ follower bases that regularly engage with their content via these outlets are: LinkedIn 40%, Twitter 23%, YouTube 58%, and Facebook 17%.

Managers’ reticence to use Facebook as a social marketing channel seems justified, but they are definitely not making sufficient use of YouTube. Given that YouTube is owned by Google, using video on their websites offers managers significant search engine optimization benefits.

 

Peregrine Cerulli 02

 

3. Measuring the effects of marketing efforts

Managers can use several tracking systems to measure the performance of their marketing and communications campaigns. Key performance indicator (KPI) tracking can distil campaigns into a concise list of agreed metrics. A KPI is any data point that gives insight into marketing performance.

It is vital that managers track how much website traffic they get from marketing and advertising campaigns.

It is vital that managers track how much website traffic they get from marketing and advertising campaigns. Good website analytics will measure the number of hits, video views, enquiries, and downloads of documents and papers—and track who is engaging with the site. HubSpot and Google Analytics are popular choices.

Of course, increasing sales is essential for asset managers. Customer relationship management (CRM) systems are databases that store and track leads, sales, and other business contacts. Salesforce is the most popular CRM system among the managers we interviewed. Some firms have their sales CRM siloed from other departments, which makes effective tracking a problem. It is important that managers monitor CRM leads. Prospective investors are being pursued by hundreds of fund managers. Understanding what they open and read is almost as important as sales.

Asset managers should propose and agree a set of PR metrics. Although being mentioned in the FT is good, context and visibility matters most.

Meanwhile, email is still the primary way that asset managers communicate with investors. Tracking programs help measure open rates and reading times on newsletters. Similarly, firms should monitor white-paper open rates. Programs such as Vera and Orangedox can track open rates on papers and documents downloaded from websites or sent as email attachments; they can even track how long papers are read for and whether they are forwarded to third parties. Some programs claim to be able to destroy PDF documents remotely.

The final metric may be the hardest to measure: personal feedback. Personal contact and phone calls are still important business tools for asset managers. When a client tells a salesperson that they really like a paper or a video it is a ringing endorsement.

Measurement of all these tracking systems can be difficult without the right tools in place. Every manager we interviewed for our study has the technology to monitor website traffic, click-throughs, and the open rates of emails. Anecdotally, this has only been the case for the past two years and, although firms have the technology they need to be more dynamic, they have not yet embraced these capabilities.

 

If you would like to learn more about how Peregrine can assist in your marketing and communications needs, please drop us a line.