Asset Management: What’s the link between your AUM and your Client Insight programme

Asset Management: What’s the link between your AUM and your Client Insight programme

“Asset management firms looking to differentiate the quality of their client experience, must capture and absorb deeper insights into their clients’ perceptions. In our discussions with some of the leading global asset management firms, senior management recognize that a Client Insight programme often does not deliver the quality insights required to help them enhance the client experience and drive growth”.

James Phillips, partner at Gulland Padfield, the specialist consultancy to Asset Management firms, discusses why best practice Client Insight programmes play an instrumental role in helping Asset Management grow stronger relationships and drive AUM.

We are often asked which factors influence an investor’s decision to develop a long-term relationship with an asset manager. While superior investment performance is the traditional benchmark, clients do not judge the quality of their overall relationship solely based on track record.
An excellent client service experience is also critical.

To deliver the right client experience, an asset manager requires a deep understanding of its clients’ objectives, needs and behaviours. Its relationship with the client is complex, with multiple touch points across the organisation.

A well-structured Client Insight programme plays an important role in shaping and managing the client experience. Most asset managers use some form of surveys (often on-line) to generate client insights. However, we see many firms frustrated at the bland data that these generate and the low participation of clients. Worse still, many surveys are poorly drafted and backward-looking. They fail to:

  • Identify the non-investment factors critical to deepening the relationship;
  • Address failings in service delivery;
  • Explore how the client relationship can be strengthened and grown.

By designing an effective Client Insight programme, the organisation can:

  • Generate more forward looking insights into the depth of each relationship;
  • Identify action points for senior management to enhance the client experience;
  • Help shape the right approach to account management and client segmentation;
  • Influence how the organization communicates and reports to clients;
  • Uncover ways in which to grow AUM;
  • Understand how to justify fee levels and defend against downward pressure.

Implementation of Client Insight requires ‘buy-in’ from multiple stakeholders across the organisation including sales, marketing, and the back office. But it is worth the effort and, done rigorously, drives AUM.

The following are ten observations to help you make the case for a better Client Insight programme:

  1. Link insights to AUM growth. Why miss the opportunity to capture a greater share of your clients’ investible assets? With a deeper understanding of their investment objectives, you have all the information to provide a tailored array of fund products and solutions to meet their specific goals. That’s the way to secure new allocations and grow your firm’s asset base.
  2. Ensure your firm stands out from the competition. Clients can provide a candid picture of those factors, which in their eyes, differentiate you from other asset managers. What drove them to invest with your firm and why would they remain investors? Is it your proposition, your marketing approach, client communications, or ability to quickly respond to and solve problems?
  3. Demonstrate how your firm adds value. It is one of the most overused statements in asset management, “How do we as a fund manager add value?” For many clients, the message behind this statement is still an important metric by which they judge an asset manager’s performance. If you consistently generate alpha or provide excellent client service, then, your firm is likely to be perceived as having “added value”.
  4. Shape and launch new products. Clients’ investment objectives and servicing requirements evolve. By understanding their changing needs you can respond. Without that you’re sailing blind. Asset managers should orient their client strategy to meeting what their clients require, not what they think the client should have.
  5. Strengthen your business development approach and message strategy. Firms often find their business development efforts generate insufficient leads or their communications architecture does not resonate with the investor community. The client voice can identify weak spots in your Client and Marketing Strategy and suggest new ways to sharpen your message for the market.
  6. Confirm whether you are using the right distribution channels. Whether your firm markets directly or relies on third parties, are your investment products and solutions sold through the best channels? The client voice can confirm whether you are optimising your relationships, targeting the right investors, or missing opportunities to extend your reach into new client segments or markets.
  7. Do clients have a positive view of your brand? You may think your brand means one thing, while a client may have a different perspective. Client insight programmes often yield conflicting views on a firm’s brand value. A gap in perception can serve as a catalyst for undertaking a fresh reassessment of your firm’s approach to building its reputation and identifying changes needed to make it resonate more powerfully with clients.
  8. Identify potential client defections. Firms assume that poor investment performance is the primary reason for client redemptions. It isn’t they often fail to recognize that poor client service is a key factor. A well-structured client insight programme provides senior management with an up-to-date picture of their service delivery performance. Spot the warning signs and your people can take a pro-active approach to pre-empting defections.
  9. Continuous improvement. Asset managers are always looking for ways to improve their operational efficiency. Internal assessments provide an inward perspective on why your firm may be underperforming. You may have some of the data to improve performance, but not all of the critical elements. Why not ask what your clients think? Their insights can provide additional perspectives into where your firm can increase its efficiency and hence its profitability.
  10. Build and track your firm’s client strategy. Client insights can provide your business with clear direction on all your firm’s client facing initiatives, i.e. what we at Gulland Padfield call your client strategy. Asset Management firms developing and launching an explicit Client Strategy find their Business Strategy is implemented more effectively. And you can’t build a Client Strategy without Client Insights.

If you would like to undertsand how you can make your Client Insight Programmes more effective and create the Client Strategy for your firm, contact James Phillips on We would be happy to discuss our approach to Client Strategy and how Gulland Padfield works with clients in the Asset Management sector to transform their Client and Business strategy.

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