The recent explosion of low-cost passive strategies and the growing interest in alternative investments is reshaping the traditional model of money management. According to a recent KPMG report, this evolution – coupled with new technology, demographic shifts and changing social habits – will lead to half of the firms in the global asset management industry ‘dying off’ by 2030.
In this asset management world of ‘natural selection’, the strong will survive by attracting assets – and assets will flow to those managers that differentiate themselves by highlighting the strengths of their strategies and demonstrating that they understand the current challenges their investors are facing.
This is why thought leadership, a term often misused and misunderstood, has become such an important tactic in an investment manager’s arsenal. It allows them to stand out from their competitors, increase brand equity, generate new business and open gateways to the consultant community, as well as helping to establish them as a leader in a specific market.
Bill Gross, founder and CIO of PIMCO, is a prime example. His monthly Investment Outlook, coupled with the frequently published insights of his diverse team of investment professionals, has helped transform his company into the definitive authority on bonds. Even as the firm’s flagship fund has leaked assets over the last year, the firm’s insight is followed religiously. BlackRock and GMO have also employed thought leadership to command a strong share of voice amongst their peers.
Given the experience of the financial services team here at Aspectus PR in developing content for managers and others, we see four elements at the center of any impactful thought leadership campaign:
Boldness – true thought leaders always speak their mind. Take a risk and don’t be afraid to give a prediction. Even Bill Gross misses the mark (from time to time).
Consistency – once a year just won’t cut it. Make it monthly and people will be much less likely to forget you.
Transparency – equals trust. Investors now want to understand the inner workings of the strategies in which their money is being put to work. So let them in and their trust will grow. A recent FundFire video interview with the CIO of a US pension fund supports this proposition by stating that a manager’s ability to articulate its strategy heavily influences manager selection.
Dialogue – use your thought leadership program as a forum. If your investors have burning questions, take the time to address them. A two-way dialogue is a proven way to gain trust and make you stand out.
Naturally, asset managers can also benefit greatly from strategic guidance to ensure that they are thinking critically, that the writing is high quality, and that their content is being distributed to the right audience through the appropriate channels. It’s never too late to adapt.