It's a new world for European asset managers. In the wake of the pandemic, a growing number of their clients have begun to opt for online communication tools rather than in-person conversations, and these businesses have been forced to rapidly rethink their sales and marketing strategies to meet the demand.
According to a Cerulli report, managers in major European economies such as the U.K., Spain, and France are planning to increase their sales headcount and adjust their marketing strategies to catch the latest communication trends. More resources will be deployed to video production, social media, and brand development, a trend that will likely continue as managers compete for digital attention.
During the early stages of the pandemic, European asset managers rushed to develop virtual communication tools to show their clients that “they were there if needed,” according to Fabrizio Zumbo, associate director of European retail and wholesale research at Cerulli. Clients have grown to like the convenience of digital communication over the past 18 months, pushing managers to pour more resources into building a more responsive system for their clients.
Forty-two percent of asset managers in Europe plan to give clients more access to portfolio managers, and 58 percent believe that doing so will boost sales, according to the Cerulli report, which analyzed 30 interviews with large international managers that have a presence in Europe. It also surveyed 50 asset managers with $3.8 trillion in assets under management about their sales strategies, as well as 102 third-party fund selectors about their perception of asset managers’ brands.
“Investors want time with portfolio managers,” Zumbo said in a statement to Institutional Investor. “This is a trend that we are seeing in the last few years in Europe, which also translates into more spending in sales-related activities and operations.”
Forty-one percent of managers in the U.K., 34 percent in Spain, and 32 percent in France plan to increase their sales headcount, according to the report. Almost half of the respondents said that they’re trying to increase the specialization of their salespeople, and 38 percent said they would increase the number of investment or product specialists.
Social media will become the next battleground for asset managers anxious to distinguish themselves from competitors. Forty-two surveyed professionals said social media specialists are at the top of their hiring lists, while 44 percent said they want to significantly increase their social media content over the next two years. LinkedIn, for example, has helped managers tailor messages for professions with different job titles, while Twitter is a great tool that allows them to engage with members of the media and financial advisors, according to Zumbo.
“Asset management, widely regarded as conservative, has embraced the use of social media to a greater degree during the coronavirus pandemic,” Zumbo said. “Firms that had previously resisted social media had little choice but to use Twitter and LinkedIn in the absence of in-person meetings and events during periods of lockdown.”
What stood out to Zumbo is that some managers are even using Instagram to advertise their products, primarily because the platform targets a younger audience and helps managers “build their awareness among people who [have] yet to invest or join the fund industry,” Zumbo said. Instagram also has a high engagement rate and is a great way for managers to provide educational content or showcase their culture, he added.
According to the report, more video content will be integrated into the social media strategies employed by asset managers. Forty-four percent of respondents said they would increase the use of video on social media, and 46 percent said they would ramp up video content production over the next year or two.
“Video content marketing is increasingly important in asset management marketing,” Zumbo said. “To reach clients whose preferences are shifting, managers are building strong and diversified video marketing strategies for different investor channels, which are now more accustomed to [consuming] video content following the pandemic.”