The book “Men Are from Mars, Women Are from Venus” discusses the fundamental differences between men and women. Is the phrase also true when it comes to investing? Studies in both Europe and the US indicate that women and men have different financial experiences; and that these experiences contribute to their investment decisions.
With the population of men and women in the world roughly equal, women are a valuable demographic for asset managers to target with effective communications.
So, what are some of the best ways to involve and engage women in investment communications?
Men have historically dominated the financial field. In fact, a study by the University of Delaware showed that women made up just 24.5% and 26.9% of economics and finance majors, respectively. And a recent study by FINRA showed a gap in financial awareness between the genders. According to the research, men scored higher than women on a 10-question quiz on investments. Additionally, only 34% of women surveyed felt comfortable making investment decisions, compared to 54% of men.
The findings across the pond were not much different. A report by British market research firm Kantar showed that 38% of women in the US felt “in control of their financial future”, as opposed to 51% of men.
How can asset managers bridge the knowledge gap with female investors? An excellent way to start is to strengthen communications with the purpose of educating and informing. Building on the basics through virtual investment webinars, educational marketing materials, and reports that communicate in a jargon-free way are all great ways to start.
In setting financial goals, women have historically stressed saving and safety over risk. Therefore, looking at the long-term picture rather than the short-term gain should be an essential aspect of marketing to women.
Given that women live longer than men, their retirement goals should reflect an increased life expectancy. However, despite proven evidence of how stocks outperform in the long run, women are more likely to keep their investments in cash.
Women are looking at end benefits when it comes to investing. Working toward a goal – whether it be retirement, college savings, or a rainy day – is a pivotal way to engage and involve women when mapping out their long-term strategy. Further education about risk and reward can be an introduction to lowering a woman’s level of risk aversion.
Women are more likely to respond when they feel there is a connection between them and their choice of an advisor or the investments they make. Women want their investments to align with their overall social beliefs and are willing to accept a lower return to invest in companies that have a positive social impact.
Keys to increasing engagement include consistent communications, such as educational series, webinars, and informative blog posts, which can help establish a positive, on-going relationship.
Educating, building trust, and increasing engagement can all help overcome a woman’s apprehension to investing. And the benefits of increasing a woman’s investment knowledge may well be worth the effort. As women live longer, rise to higher ranks in corporate leadership, and make more financial decisions, their impact on the market grows.
Engaging and empowering female investors in a way to which they can relate can improve your bottom line. Let Copylab’s investment writing experts help you reach and impact this critical demographic.
