When a fund is struggling, one of the first things to take a hit is often the marketing budget.
The thinking is that spending money on marketing during a down-time is wrong – as it is a non-essential expense.
But is that a wise move? Or can investment in digital marketing actually save a struggling fund?
The answer to this question lies in the ability of digital marketing to help raise, and retain, assets under management.
And this can be split into four main sections:
1. Investor Experience
One of the biggest benefits of digital marketing is that it can help improve the experience of your existing investors – and with it their perception of your fund. The fact is that the role of the relationship manager is to an extent being replaced by digital self-service. Investors increasingly want online portals where they can get an immediate summary of their account, search across asset classes in an instant, and create watch lists.
So, an online portal improves investor experience and allows you to engage much more effectively with your existing clients, which can be vital in encouraging them to retain, and boost, their investment.
Another important aspect of investor experience is your website, where you can post helpful thought leadership articles. These can be used to provide an insight into your long-term strategy – and by doing this you build trust and show that, even if your fund may be temporarily down, you have a plan for the future. This can be instrumental in calming fears and discouraging investors from withdrawing funds.
But, with all your digital touchpoints, you must think very carefully about design. It is critical to have a design that is both user-friendly and easy to navigate.
2. Targeting new investors
Digital marketing allows you to group all your activity in one place, which stores interactions with your website, digital marketing campaigns, and investor portal.
Software can then automatically analyse this data and grade your clients and prospects accordingly. For example, if a prospect is suddenly downloading and reading lots of information – a sure sign they are ready to invest – then he or she will be flagged up for the attention of sales. You can also see those who has suddenly stopped reading your material, which – if they are an investor – is a red flag that they may be about to withdraw funds, and thus an intervention is needed.
This type of automatic digital grading takes the guesswork out of marketing, as you know the attitude of clients and prospects to your fund.
When you’re dealing with multiple funds, digital marketing has an invaluable role in identifying cross-selling opportunities.
This is vital, as research shows that around 97% of buyers purchase from sources they know. Thus, your existing clients are by far your best source of potential new investment – as these are people who already trust you with their money.
So, you need a digital marketing system with the ability to create cross-selling reports, which show you which funds your clients are already invested in and the funds they are showing an interest in – so you can then reach out to them with a new offering.
4. Integrated marketing
A new form of integrated marketing – which brings together the three silos of marketing, IT and sales – can be implemented through digital marketing.
These three departments – which are so often autonomous – can and should work together to concentrate on raising and preserving AuM. To achieve this, your IT department must combine marketing and sales analytics through APIs (application programming interfaces) which move data through your organisation – from the marketing department into CRM or content management – and then into analysis, which in turn leads to actionable insights.
So, in answer to the question posed by this article, digital marketing certainly can save an underperforming fund. But, for it to succeed, there has to be a realisation that digital marketing is not an expendable service that can be stripped away when times are bad, but rather it is essential and can dramatically change the fortunes of your fund for the better.
Here is a link to the webinar we rang on Can Digital Marketing Save An Underperforming Fund?