There is a tension at the heart of many asset management firms between two often conflicting goals: (1) maintaining investment excellence at all costs; and (2) marketing/ business development.
For managers listed on the stock-market with quarterly reporting obligations as well as debt holders and the analyst community to appease, this tension can literally split the firm into competing parts. The investment staff often generate investment strategies and investment products in a ‘laboratory’ without engaging clients/ the market. The marketing/ sales team may push for strategies that tap into trendy themes (e.g. volatility hedging, environmental, emerging markets etc) without considering the long-term impact on the client’s portfolio and the firm’s credibility. Meanwhile the COO/ CFO drive the firm towards meeting short-term capital raising and revenue generation targets – often putting the interests of shareholders ahead of investors.
The goal of strategic marketing is to define and execute on a marketing strategy for the firm, including helping to define growth targets, while keeping the firm’s brand on its long-term mission and ensuring the firm remains true to its values and guiding principles.
Here is my 7 point plan for doing that.
The starting point is to have a clear sense of the firm’s vision, mission and values. More than this though, it is critical to be able to articulate what makes the firm unique. I believe that the strength, individuality and vibrancy of a firm’s culture is the lifeblood of its brand. And the truly great brands reflect authentic cultures characterised by values that people can connect with.
Without an intuitive understanding of the firm’s fundamental nature it is impossible to set a clear direction for the brand or to balance, or judge, the merits of competing projects, product launches and objectives.
2. Sales strategy
Asset management firms are increasingly looking to expand their client base away from traditional institutional channels into high-net-worth or retail channels and/ or into European, emerging and niche markets. Strategic marketing teams proactively analyse the dynamics of entering new markets including the requirements of the investor community, pricing and product features, regional preferences for communications, reporting and so on. This may involve working with local marketing staff to ensure that the firm’s core brand values are maintained while at the same time enabling the local business to respond flexibly and appropriately to evolving market conditions.
3. Thought leadership
Designing, developing and maintaining a thought leadership programme for the firm is a core piece of the strategic marketing function. This involves listening to the concerns of clients, working with internal investment staff and producing a steady stream of high quality, thought provoking commentary on issues being researched by investment teams or of specific concern to particular segments of the market.
This body of work needs to be tailored for specific client types and to the requirements of investors in markets around the world. This includes considering investor sophistication, the structure, dynamics and key issues in particular regions and of course languages/ translations and design elements.
4. Product development
As the ‘strategists’ charged with keeping the firm’s brand on its long term mission, the strategic marketing team has a difficult job to do when it comes to product development. On the one hand it is important to listen to clients/ the market and respond to its needs with customised solutions. On the other hand, product proliferation is the bane of investment consultant’s existence.
Product proliferation can signal that a firm is more focused on its own economic interests than those of its existing clients. The strategic marketing team needs to chart a course between these conflicting outcomes. The guidance and advice given to the business needs to be well researched, grounded in long-term high conviction ideas and market-tested.
5. Consultant relations
As the gatekeeper for approximately 80% of investible institutional assets in the U.S., the investment consulting market is critical for asset managers to cover properly. The strategic marketing department is in a perfect position to develop solid relationships with the key research and field consultants given its role as custodian for the firm’s ‘messaging’, strategic advisor on the product development side, and manager of the RFP/ RFI process. Internally this puts the onus on the team to communicate openly and frequently with both the sales force and the investment teams.
6. Market Intelligence
Keeping abreast of market and competitor intelligence is critical in order to properly service your clients, benchmark your performance and test your business strategy. Designing and implementing a systematic process for capturing, analysing and communicating the key trends is an important part of strategic marketing. This involves targeting the high quality conferences, subscribing to the key industry news services, signing up for investment consultant white papers, reviewing competitor materials/ performance analytics and maintaining proprietary databases. Tapping competitors, consultants and other industry sources, joining private industry forums and producing your own exclusive networking events will ensure a steady stream of information. Finding the right modes of communicating your findings within your organisation must not be overlooked..
7. Integrated marketing & communications
Developing and designing marketing collateral/ electronic media and integrated communications is the bread and butter of a marketing department. Synthesising the creative process with the firm’s thought leadership agenda, product development activities, consultant sensitivities and market intelligence is what separates high quality communicators from the pack.
Traditionally asset managers produced quarterly reporting, investment outlook pieces, and periodic white papers. Increasingly though, managers need to distinguish themselves on the quality of their client service. This is leading managers to produce a steady narrative of commentary and analysis in increasingly innovative formats. Today managers need to consider interacting with clients via webcasts, podcasts, blogs and internet portals as well as consider their social media imprint and search engine optimization.