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12 Ways To Make Fund Commentary Your Most Valuable Marketing Document

Ross Hunter 21 January 2022

What do Tiger WoodsBobby Ewing and tube tops have in common?

They were all written off and made remarkable comebacks.

We think the humble fund commentary deserves its place in this parade of ‘rags to riches’ stories. You don’t think it’s possible? Our two-word rebuttal is: Berkshire Hathaway.

Investors hang on every word of chairman Warren Buffett’s annual shareholder letter; it’s largely the investment vehicle’s only marketing communication (have you seen the website?).

In this five-minute read, you’ll discover 7 great reasons why CMOs should make their fund commentary a higher priority in their marketing toolkit – and 12 ways you can turn them into your most valuable marketing documents.

1. Performance Still Counts

It may not be a guide to the future. But let’s be real. Investors buy performance, and fund managers sell it. Equally, investors sell out on bad performance.

So, here’s the question. What are the most downloaded items on your website? For most of our clients, it’s their fund factsheets.

We see some asset managers taking written commentary off their factsheets. This is usually at the behest of the sales director to get the factsheet published quicker.

Speed is the wrong KPI here.

Consider the ABC Fund Managers’ flagship fund. It’s outperformed over three and five years, but a bad 18 months has hurt the one- and two-year numbers. Investors are starting to sell out and ABC’s AUM is haemorrhaging. Without even some basic context like “growth stocks have been out of favour, but this will turn around in the next six months, so stick with us”, ABC isn’t giving investors a reason to stay.

2. The No 1 Tool For Customer Retention

Every marketer knows that it costs more to acquire new customers than nurture existing ones. (Harvard Business Review estimated the figure at 25x.) In a fund management industry facing intense cost pressure, budget allocation should be a no-brainer.

Yet, most marketing departments still spend more on customer acquisition.

Sure, the thrill of the chase is more exciting than nurturing existing relationships. But if we marketers can drag ourselves away from the Tinder-like lure of hunting, there are some simple things we can do to defend hard-won AUM.

3. Sales Teams Love Commentary For Customer Acquisition

Despite all the millions CMOs spend on content, marketing, advertising and digital strategies, fund management sales teams still use fund commentary as a sales document.

There are good reasons for this. At a prosaic level, fund commentary gives the salesperson a reason to get in touch with clients and advisers.

But done well, the commentary can be a window into the manager’s brain, heart and soul. It provides reasons for decisions that went well – and badly.

And it gives insight into their crystal ball. It can emote and evoke, and entice people to invest in ideas that will make them more money and help them get nearer to their financial goals.

4. Build Brand Awareness

This is a dangerous time for fund managers. Our community of ultra-smart people have outsourced customer relationships to intermediaries like investment consultants, wealth managers and financial advisers/RIAs. As a result, very few fund managers have any consumer brand awareness and the service is essentially a commodity. Sorry, guys – look at the annual Interbrand survey: there are no asset managers in the top 100 (though some banks and insurers make the grade). What’s going to happen if/when Google or Amazon enter this market?

Major upheaval may be unavoidable. But you can limit the damage to your own brand if you invest in building brand awareness with your ‘end users’. (Intermediaries certainly aren’t going to do that for you.)

If you believe our industry is headed for significant disruption, then a communications strategy for consumers and other end-users like pension fund trustees will be essential.

In a budget-constrained world – assuming you don’t have an American Express-size advertising budget – an efficient way to start is by building up a small-but-fanatical fan base like Ferrari’s tifosi.

Regular monthly fund commentary is a cost-effective way to get started. But how?

To learn the other great reasons for boosting your fund commentaries, and our tips and tricks for doing so…

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