Asset management firms have difficulty developing a brand image because the market is heavily intermediated and performance driven. Only a few of the largest firms have developed their brands. Magnus Spence has been carrying out research amongst asset management firms to establish why others haven’t followed.
I once listened to a senior and well-regarded commentator on the asset management industry in the US advising his senior European conference audience to avoid brand-building at all costs. “The asset management industry did fine before marketing was invented, and it can do fine again without it”, he said to nods of approval around the room. All you need, he told us, is better investment performance than the herd ‘alpha’. Once you have it, the world is yours for the taking. Every cent invested in promoting anything except your performance numbers, we were told, is wasted. This attitude used to pervade the industry, and still exists. But now there is new thinking, which allows brand more headroom. In a recent consulting project I spoke to 35 asset management marketers in the fund business across Europe to hear what brand meant for them today, and to understand better how they were overcoming the obstacles to branding.
The word brand now appears in job titles in a way that it never did even five years ago. Brand building is now mainstream thinking. There are firms who foster their brand values and identify their brand attributes in the way that might be recognised in an FMCG environment, and in these shops huge effort and resources are indeed put into “building the brand from the inside out”, as one put it, or “brand activation,” as it was described by Philippe Lebard in the last edition of Argent.
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