Fund Houses Face Fresh Hurdles When Selling You Their Wares

The distribution of fund products has undergone a sea change, but even now marketing teams sit in flux, handling further changes as best they can

Catherine Elliott 28 February, 2022 | 2:02PM
Facebook Twitter LinkedIn


The function of the asset management marketing team was once a role predominantly focused on brand, sales enablement, and overseeing fact sheet production and communications.

But big changes in the investment landscape, coupled with significant shifts in the way we now work means there is greater expectation and opportunity for marketing teams to play more of a strategic function within the wider business – helping to attract clients to funds and ensure they continue to grow assets with firms.

That doesn’t come without its challenges. An increasingly competitive landscape has made it that bit harder for firms to differentiate themselves and their offering, especially in the wake of the Covid-19 pandemic and the dramatic shift towards ESG and remote working.

Rapid Change  

The digital way of working is here to stay: in a recent survey by Alpha, 97% of asset managers said digital was a top or high priority area, with 45% of firms aiming to increase digital spend by over 5% in the next year.

Marketing teams are coming into focus to lead the digital agenda for many firms and ensure that services and products are being promoted via remote channels, as well as nurturing prospects to leads through a personalised digital journey. This can be seen in the rise of online content such as webinars and digital events that can be accessed by anyone regardless of geography or time zone.

But rapid digitalisation has created a huge hurdle for those firms who were lagging behind pre-pandemic. They’re now scrambling to get their digital channels up to scratch, often without the correct infrastructure in place and the accompanying platforms that can turn data into actionable insights.

Compliance Bottleneck

Regulatory requirements are evolving at such a pace that keeping up with these changes can feel a little like swimming upstream. Compliance is, after all, a necessity and one that trumps all other tasks in the pipeline.

Changes often occur every month, which means adjustments need to be made and marketing material continually updated; what may have been a one-page document becomes a three- or four-page one. This makes it harder for marketing teams to provide content reflective of what their users actually want, rather than complex documents that are satisfying compliance.

A timely example could be the EU’s Sustainable Finance Action Plan and its components. Every firm operating in the EU now has a raft of sustainability legislation and disclosures to adhere to, with new delegated acts and amendments popping up frequently as the need for greater transparency around these issues becomes clear. That’s a substantial amount of extra box ticking, which leads nicely onto the next point.

Telling The Story

The impact that Environmental, Social and Governance (ESG) concerns have had on the investment space cannot be overstated. As the need for a global transition to a low-carbon economy becomes ever more apparent, the future will be about sustainable investing – investing that marries the traditional economic approach of aiming for the best risk-adjusted returns with a drive to improve corporate practices to protect and benefit society and the environment.

What was once considered a niche investment area is fast gaining the attention of investors, mirrored by an increase in sustainable fund flows. Investors poured USD 142 billion into sustainable funds globally at the end of 2021, according to Morningstar data, representing a 12% increase relative to the third quarter.

And with a staggering amount of data available to show investors the precise ESG risks associated with their portfolios, the challenge for firms lies in its effective communication. Whether retail or otherwise, most investors are not versed in the new sustainability jargon or the myriad of datapoints available to them. It’s ultimately up to asset managers and their marketing teams to effectively convey this often granular and complex data into digestible insights that make sense to clients. 

Moreover, one firm’s ESG goals and objectives will differ entirely to another’s, so trying to meet all these ambitions highlights the need for product diversification and, subsequently, a focus on how they are communicated. Marketing teams will have to produce higher-quality documents in flexible formats in order to remain competitive in one of the fastest growing financial investment sectors.

New Demands

At a time when the marketing function of asset management firms are undergoing a transformation driven by changing investor preferences, tightening restrictions and a largely digital way of working, marketers need to meet this new business demand by having the correct technology, processes and structures in place.

Morningstar’s flagship investment and research platform, Morningstar Direct, is used by asset management marketing teams to fine-tune competitive advantages and market innovative investment products using institutional-strength data, sophisticated analytics and independent global research.

To find out more about the evolving role of the asset management marketer and how Morningstar Direct can help, download our full guide here.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Facebook Twitter LinkedIn

About Author

Catherine Elliott  is a content writer at Morningstar

© Copyright 2024 Morningstar, Inc. All rights reserved.

Terms of Use        Privacy Policy        Modern Slavery Statement        Cookie Settings        Disclosures