By Fiona Maciver
With so many fund providers to choose from in Europe, recognising a brand is a crucial first step in the fund selection process. In more retail-driven distribution channels, brand visibility has become increasingly important, not only with fund buyers but also end-consumers. From the asset manager’s point of view, getting a handle on brand awareness levels across markets is key to determining marketing strategies and tactics for targeting retail segments. This month, Fund Radar takes a refreshed look at the asset managers most visible to European selectors at the cross-border level and in the fast growing local markets of Italy and Spain.
- BlackRock enjoys the greatest unprompted brand awareness among European fund distributors.
- M&G’s visibility helps it to retain pole position for unprompted advertising awareness
- Franklin Templeton and JPMorgan are the most recognised groups in the key growth markets of Italy and Spain.
In the cases of small, specialist boutique managers, popular niche products can rapidly propel them to the top of selectors’ minds. Larger managers may benefit from heavyweight marketing budgets, but with generally wide-ranging product palettes, they have to work harder in areas such as sales and marketing support to get the finer points of product strategies the desired level of attention. For many, brand is the only differentiator. So which asset managers are achieving high recognition levels with retail fund buyers?
On the tips of tongues BlackRock maintained the highest level of unprompted recall with retail fund buyers during the period under review – the six months to the end of January 2015, compared with the previous six-month period. The behemoth’s sheer size and vast product range, embedded across both passive and active strategies, provides the company with a strong platform with which to grab the attention of buyers. As we have been advocating for some time, advisers are looking for more support to facilitate their sales process. BlackRock is very active here, assisting retail channels with marketing initiatives (including investor education) and forming a better understanding of end-clients through its Global Investor Pulse study. While BlackRock was able to consolidate its position over the six-month period, JP Morgan, Fidelity, Franklin Templeton and Schroders all increased their awareness scores.
Strong in Southern Europe
As highlighted in the December 2014 edition of Fund Radar, Italy and Spain are two markets that look set to enjoy particularly strong growth in assets under management this year. They also display some notable variances in the top groups for brand awareness. Franklin Templeton and JP Morgan achieved the highest recognition among Italian fund selectors during the six-month period. But it was Pictet that achieved the biggest increase in brand awareness. Standing out from the crowd in Italy has become tougher with a large number of international and domestic players upping their game to get a share of the spoils. Despite the stiff competition, the Swiss asset manager increased its unprompted recognition from 19% of respondents to an impressive 30%, moving it into fourth place, just below BlackRock. In recent years, Pictet has stepped up its levels of activity with Italian distributors and end- investors alike building awareness through roadshows and investor education. Spanish eyes continue to favour international groups too, fuelling an increase in foreign groups registering funds for sale there. Competition may have intensified but four out of the top five groups for unprompted brand awareness all managed to increase their visibility with fund buyers. Franklin Templeton secured the biggest of these increases – moving from 33% to 41% of respondents naming it.
The advertising route to recognition
With multiple touch points in the fund buying process, there is no prescribed formula for building brand awareness. Successful groups use a combination of sales and marketing activities that might include face-to-face meetings, PR, events, marketing content, sponsorship, and advertising to build recognition with target groups. Advertising is an element that Fund Buyer Focus evaluates regularly with distributors, on two levels – awareness and overall quality of advertising output. Of course, in the digital world advertising now spans many different media channels alongside the more traditional print option. The survey takes a top down approach and doesn’t make any distinction between offline and online or trade and consumer media channels. Interviewees are asked: ‘When thinking about advertising of third-party retail fund groups in your country, which providers’ advertisements have you seen, heard or read within the last three months?’ As with the brand awareness data, the resulting percentage scores reflect the proportion of distributors who have named a particular provider.
Advertising obviously comes at a cost. Trade advertising and online activity is more affordable for a broader range of asset managers, while offline and outdoor billboard activity is only for groups with deep pockets. For example, according to Ptarmigan Media, BlackRock spent the equivalent of €2m on UK retail advertising alone in the first half of 2014(1). M&G is another group that invests heavily in retail advertising; this clearly chimes well with third-party fund distributors, as reflected in the company maintaining its top position for unprompted advertising awareness and a strong relative position in unprompted brand awareness levels. M&G continues to enjoy high visibility and recall at a cross-border level and very high advertising recall in Italy and Spain. The company has reached both trade and consumer audiences through clever use of intermediary and consumer advertising material. Significantly, distributors regularly comment on the company’s high brand awareness with end consumers in key markets. While M&G has the edge for advertising recognition, for the quality of advertising the big US houses of Fidelity and BlackRock pushed it into third place (see table above).
1)As reported by Ignites Europe on 4 December 2014