“In a competitive and recovering global economy, the asset management firm which differentiates with insights as well as capabilities will win. But from our analysis of the sector it is clear that more needs to be done to leverage analytical capital and investment experience, craft an opinion and create thought leadership which drives increased investments.”
James Phillips of Gulland Padfield, looks at the results from a unique study examining over 40 of the leading asset management firms’ thought leadership and briefing papers using Gulland Padfield’s Thought Capital Assessment Matrix and sets out four success strategies.
Walk into the offices of any of the largest asset management firms and you often have to look hard to find more than technical or investment related updates and articles. Take a look at the typical Asset Management firm website and it is often a similar story. And yet beyond the frosted glass of the reception, asset management firms sit on a staggering depth of insight. Clients and investors tell us that Asset Management Firms could do much more to demonstrate their insight. Why? The arguments are clear:
- Well-structured and insightful thought pieces and publications are a powerful way to engage with clients and investors. It is far easier to differentiate against competitors around insights, rather than often similar capabilities, to attract investors and clients.
- Strong pieces ensure investors are better informed about your firm, its investment strategies and the potential benefits of its products and services.
- A thought leadership programme communicates your firm’s investment philosophy, showcases the depth of its expertise and its investment professionals, and demonstrates how the firm considers structuring investment portfolios.
- A range of communication channels, such as white papers, monthly articles and webcasts, allow you to build deeper relationships with investors.
As part of how Gulland Padfield supports our clients in shaping thought leadership initiatives to raise profile and drive business development, we reviewed the 40 leading global asset management firms and their publically available publications and content.
It is clear that in combination with our own ‘Thought Capital’ approach, Asset Management firms have a strong opportunity to transform from technical updates and thought pieces to creating Thought Capital campaigns which effectively raise profile, drive business development and deliver clear ROI.
From our analysis, some firms are prolific in their content production and offer a range of insights for public consumption. Others produce very little. Interestingly, there is no strong relationship between the size of the firm and the amount of content they make available. By using Gulland Padfield’s proprietary Thought Capital assessment matrix comprised of 18 criteria, we were able to make the following additional observations. The matrix assesses the quality of a firms’ programme based on its content, engagement and delivery.
The leading firms in our review offer:
- A wide range of perspectives: most programmes produce content recapping financial markets performance or sharing insights on general macro-economic trends. Many firms go beyond and provide deep insights into a wide range of investment themes, such as asset allocation and future prospects, or original research into a specific asset class. At the other end of the spectrum, some firms publish little if any perspectives.
- Opinions with go beyond the financial markets: a number of firms produce content touching on global, social and political themes and their potential impact on the financial markets. Some of the topics include sustainability, demography, and resources. By incorporating these themes, it illustrates a firm’s ability to think laterally and factor in other elements into their investment decision making process.
- Ideas to address a client’s challenges: Only a small number of firms approached this question from the perspective of the investor and shared insights into the types of specific solutions which could help investors meet their objectives. for some investors, a Thought Capital programme can serve as a useful resource to help them address their long-term challenges.
- Information which is easily accessible: we found that a number of web sites are poorly designed making navigation more difficult for the visitor. Firms should ensure that the format and structure of their Thought Capital programme is well designed to make it easier for the reader to identify and access the appropriate information and right publications.
- A range of communications channels: many firms use videos and podcasts to broadcast the perspectives of their leading investment professionals. They are increasingly using social media to illustrate their views. Some firms use thematic conferences and seminars as an interactive forum to engage with clients.
When designing or upgrading to a Thought Capital approach, asset management firms should consider the 4 following strategies:
1. Shape a Thought Capital program which showcases the firm’s capabilities and expertise
Investment performance is usually the primary driver behind an investor’s decision to invest with a particular asset management firm. A well designed Thought Capital programme which illustrates a firm’s analytical capabilities and strengths of opinion can contribute to the decision making process. Investors appreciate reading content which is rich, differentiated and value enhancing. Asset managers should therefore leverage their organization’s strengths and knowledge base to deliver unique perspectives on themes of importance to their clients and prospects. By providing insightful content and ideas on how to meet an investor’s specific challenges, a firm can provide greater transparency into the benefits and strengths of investing with it.
2. Ensure your program is designed with your investor base in mind.
The starting point for designing an effective Thought Capital programme begins with a clear understanding of your clients and prospects. Retail, high net worth, family office and institutional investors will each have their own set of interests, challenges and investment objectives. By understanding their needs, an asset management firm can structure the programme accordingly and allocate the right internal resources to developing the content. Among the questions it should ask are:
- Who are our clients and who do we consider our prospects?
- What are the key issues and challenges facing them?
- What are their financial objectives?
- How should we tailor the content according to individual client segments?
- How do we ensure our programme fits into our overall client strategy?
- What are the best ways to use Thought Capital pieces when we engage with clients or prospects?
- Finally, we recommend that firms consistently assess whether the programme meets the expectations of its clients, helps them achieve their objectives and enhance their perceptions
3. Structure the content in the right way
Firms should consider the following questions when structuring their content. The answers will help to enhance the effectiveness of their Thought Capital programmes:
- Is our content accessible to both existing and prospective investors?
- Does it have depth and leverage our firm’s analytical and intellectual capabilities?
- Is it original, opinion shaping and demonstrate our firm’s expertise and leadership within our markets?
- Does it provide innovative ideas to help investors meet their investment objectives?
- Does it provide breadth, depth and creative thinking?
- Does it strike the right balance of shaping opinions and making recommendations within the regulatory constraints?
- Which are the optimal tools and channels to communicate with our client investors and ensure we have designed your on-line presence with the investor in mind?
4. Align Thought Capital with your business objectives
A well designed Thought Capital programme should help an asset management firm to achieve its business objectives, whether by broadening its client base by investor type or geography, increasing assets under management, or diversifying its range of products and services.
It must remind itself that content should be tailored to address the needs of a specific audience. Content should not be thought of in terms of how it captures a greater share of the investor’s wallet today but rather over the long-term. This requires the firm to continuously update its program so that it remains pertinent in the eyes of its client investors and enhances the firm’s reputation.