Hedge Fund Marketing Strategy – In A Post Covid Digital World

It goes without saying that much has changed over the last couple of years – in all walks of life

And in the fund marketing sector, the biggest change has been a digital transformation in the hedge fund marketing strategy. This has been going on for years, but the pandemic turned it from a steady river into a raging flood.

No firm got through 2020 without turning to digital methods to communicate and engage with clients and prospects.

But what about 2021, after the initial shock has subsided and we’ve all been getting back to a form of normality?

In this white paper I’m going to unpack the fund marketing trends we’ve been seeing this year – and the lessons that can be learnt for 2022.

Embracing Digital Change Is A Profitable Move

Everybody went headlong into digital in 2020 – there was no other choice.

But there’s a difference between necessity and getting ahead of the game. And it’s the companies that have made a big digital shift – in terms of outbound marketing activity, but also changing internal systems – that are really benefitting and seeing increased profits as a result.

But what of those firms who – pre-pandemic – were resisting digital change? As the world edges back to normal, have they reverted to type?

There is certainly an element of that going on. And to an extent it’s not a problem. We are social creatures, so it’s good to be going to meetings again and seeing investors face-to-face.

But if you take that process too far, then you risk wasting all the investment and effort that has been put into digital transformation.

To stop this, It takes someone within a firm to stand up and point out that significant time and resources have been put into digital transformation – and that it’s an investment that must be protected.

Zoom’s Loss Is Email’s Gain

2020 was the year of Zoom. From family gatherings to business meetings – everyone was on it.

But in 2021 things have changed. ‘Zoom fatigue’ has set in and people have looked for other channels.

And the big winner in this regard – at least in the fund sector – is email.

A recent survey of fund managers and investment managers found that 93% of respondents cited email as their preferred medium of digital content distribution. Websites were second on 67%, and Zoom trailed in fourth with 25%.

And the information that’s being sent via email is, in order of popularity, product/strategy updates, innovative investment approaches, market perspective, portfolio advice, and general ideas.

So, people who matter in the fund business prefer to get detailed, thought leadership-style information via email. This is the market self-selecting what it wants to hear and how it wants to hear about it – and that is overwhelmingly through email.

We All Realised The True Value Of Fund Marketing

All too often the marketing team is seen as the ‘unwashed hippies’ within a fund – liberal, arts-types who have some nice ideas, but without any real relevance to asset raising and ongoing profitability.

That’s always been a dubious and dangerous view – as without effective marketing, you haven’t got a company. But the last year or so has exposed this view more than ever before The digital avalanche that followed the pandemic not only underlined the importance of the marketing team but it’s also become necessary for everyone in a fund company to have some understanding and capability when it comes to marketing.

And that’s what really changed during 2021 – pretty much everyone now sees the overwhelming value that marketing brings. When you’re engaging with all your prospective investors and clients through digital means, then you have no choice but to embrace digital marketing and do all you can to get your firm noticed.

And the follow-on from the realisation that marketing is vital is the subsequent realisation that you must actually spend some money on it to get anywhere.

The old excuses – ‘we’re too small to worry about marketing’, ‘anyone can do it, so we don’t need a big marketing budget’, ‘our products sell themselves’ blah, blah, blah – just don’t cut it anymore.

But, what exactly should you spend it on? I’ll cover that in the next section…

Where To Concentrate Your Marketing Firepower In 2022

Marketing has changed over the last year, so where should you now spend your resources?

That’s tricky, as it’s no longer the case where a marketer’s job is simply to produce factsheets and send them out. Now, because everything is digitised – there are so many more touchpoints between someone first becoming aware of your fund and actually taking the trouble to read a factsheet.

Social media, email, events, press etc etc – there are multiple ways that a person can enter into your sphere of influence and put a hand up to be contacted. You need to be across all these things, as it’s not up to you how and where people find out about your fund – so you must be in the places where people are looking.

And that requires marketing investment. But it’s also important to remember that if you’re an emerging firm – or one with anything below £10bn under management – you have to be clever how you market yourself. Many investors are simply going to go with Blackrock et al – purely as they are big and well-known.

There is nothing you can do about that – you can’t outspend the big boys.

But you can be clever – and use thought leadership and investment strategy content to set yourself apart. This can get you noticed.

How do you do that?

That boils down to the following:

Content

You need content out there, as that’s how you spread your voice and get people to listen to you. But to do it well, you must ensure your content does three things – educates, enlightens and entertains.

To do this, you can use a great marketing trick, which is to write in a way that an eight-year-old would understand. Don’t fall into the trap of thinking because you are writing about something complex, that your content should also be complex. Do that and you leave a portion of your potential audience behind. But if you write in a way that everyone can understand, then you bring everyone with you.

Also, bear in mind that the no.1 thing people want to read about is investment strategy. That’s followed by attitude to risk, with performance coming in behind them both. It’s all too easy to fool yourself that people just want to hear about your latest success.  But the fact is that both potential and existing investors are far more interested in how you’re going to handle and invest their money.

Repurpose

If you create a piece of content and just use it once, then you are missing a trick.

Instead, you should repurpose it and use it across multiple channels. A blog post on your site, for example, can be turned into an email to your list, a factsheet, a webinar or podcast episode, and broken down into multiple social media posts. It could even, depending on the subject matter, be sent out as a press release.

But remember that everything you do must carry the same message of knowledge and experience.

Make sure you get found

If a tree falls in the woods, and nobody’s there to hear it, does it make a sound?

I have no idea.

But I do know that your content is useless if nobody is there to read it. So, you need it to be found online. This does NOT mean throwing money at SEO. It sounds like a dream to build a website, put relevant content on there and then just wait for people to turn up. But that is a dream – as SEO is incredibly hard to get right. It can take two to three years to get yourself anywhere near the top of the search engine rankings, as this is an incredibly competitive field. And even if you are successful, it’s often transitory – as others are constantly trying to top you.

And don’t spend money on Google Ads, as it doesn’t work without a lot of testing and experimentation. Instead, put yourself where your prospects are going to be, for instance, Opalesque, HFM, etc. Also, ensure that research and advertorials are available and that your managers are on panels etc. And if you can get on things like Bloomberg, BrightTALK etc, then all the better.

Gather contact data

You can use your content to capture data, as people will give you their contact details in exchange for helpful information. Obviously, you have to make sure it’s all GDPR compliant, but it’s an easy way to add quality leads to your list.

Email

As I said earlier, email is booming. It may be a bit of an ugly duckling amongst marketers, but it works.

So, you must put time and effort into using it well. That obviously means sending out quality content via email, but also ensuring you have good ‘email hygiene’ – by building (rather than buying) lists, removing bounces, managing spam complaints, and adhering to compliance guidelines. Platforms like ProFundCom can help you with all this.

Social media

It’s fair to say that nobody is going to invest with you on the back of social media, but you still need it. It gives a ‘marketing halo’ that builds your brand and reminds people about you. So, post regularly and with quality content – but remember it’s never going to be a big hitter in marketing terms.

How Do I Measure All This?

The big message of 2021 is that – to succeed – you must be pumping out lots of quality content across different channels.

Which is all well and good. But how do you actually demonstrate ROI? When it comes to budget (and salary) review time, what are you going to show to the C-suite that backs up the need for all this activity?

That’s where analytics comes in. You must be able to track all the engagement activity in respect to your content, so you can directly link asset raising to marketing activity.

You can do this through Excel, but that’s difficult, time-consuming and unreliable – especially if you’re using multiple channels. The easier and more effective way is to use a platform like ProFundCom, which does all this for you. It demonstrates which themes are working across all channels – and underlines what isn’t working. This type of analysis also allows you to benchmark against your peers.

But perhaps most importantly, a platform like ProFundCom allows you to prepare reports for all your prospects and clients. So it’s easy for your sales team to bring up someone’s entire engagement history, with all that reveals about their preferences, likes and dislikes. That’s incredibly powerful information when it comes to a sales call, or a conversation with an investor who may be looking to redeem.

So, to conclude – the overwhelming message of 2021, and what must be taken into 2022, is that marketing is no longer the preserve of the ‘hippies’. It’s about data and analytics – and that’s what will drive asset raising and retention in the future.