Rise above the noise, turn left on red, zig when the world zags and dare to be different – at Slam we’re celebrating the return of the brochure.

When your competitors are focused on their digital campaigns, getting to grips with social media and identifying appropriate digital influencers to gain an edge in 2011, they may be overseeing an opportunity in paper.

Liongate Capital Management corporate brochure

A recent study by branding agency Millward Brown revealed that our brains process paper-based and digital marketing in different ways. The fMRI brain scans of a test group showed that paper-ads caused more emotional processing, thereby leaving a “deeper footprint” in the brain. Physical media appears to be more “real” to the brain: it gets tied to a place and time and is therefore given more meaning.

The more emotionally connected we feel to a brand, the more likely we are to choose it over others. Ideally, you want to ensure that your brand is experienced repeatedly and on as many platforms as possible. In theory, the actual number of synapses formed in our brain could measure the strength of a brand – a methodology we’d love to explore, but which might have to wait for another day.

Neuroscience aside, we believe a brochure as well as other physical media – from touchy, feely welcome packs to beautiful exhibition design – is if anything more important today as an effective way to stand out and build emotional connections to your brand. Essentially it’s about added value. We appreciate the time and effort that goes into creating something beautiful and tactile – even more so when we can take it home as a reminder of the experience.

The key is a unified approach to marketing and basing communications on a detailed understanding of your audience. Digital communications can do things that paper cannot, not least being where your audience is and providing lots of evidence of success through measurability. But video is no substitute for the real thing and a beautiful brochure that’s worth taking home to place on a shelf can bring genuine long-term brand appreciation that is immeasurable.

So in the spirit of Marty Neumeier’s “When everybody zigs, zag”, we recommend in your communications planning that you keep a place for physical media and all the wonderful strategic and creative marketing that can be done with it.

As the alternative and traditional fund management industries become less distinct, competition between the two tribes is ever increasing, creating interesting marketing challenges, not least in the retail space. UCITS III, the European Regulatory framework and fund structure that allows hedge fund-like products to be distributed throughout the EU, are gaining in popularity with both hedge funds and main stream asset management firms. Analysis of UCITS III vehicles indicates there are now over 400 funds across Europe using the UCTIS III powers to target absolute returns. Given the competition, how do you market your new UCITS III product and make it stand out?

UCITS III has given a new lease of life to fund managers following the financial crisis. Many managers are now launching absolute return funds using powers available in the UCITS directive. A survey from HedgeFund Intelligence on the momentum-gaining trend of hedge fund companies going onshore reveals that more than half of European Hedge Fund companies plan to launch regulated, onshore versions of their strategies or have already done so. Furthermore, a fifth of European Hedge Fund managers have launched, or are launching a mainstream UCITS III mutual fund, while another third say they are considering doing so. In their research report the HFI researchers conclude:  “Considering the flexibility UCITS III offers, we’re forecasting that this trend [UCITS III fund launches] will continue”. 

Marketing a UCITS III
EDUCATION

This is a complex product for both the intermediary and end user, and successful uptake will require understanding to be developed throughout the entire sales chain. Market materials could benefit from being stripped back to the bare essentials in order to highlight the product’s unique selling points. The rules of UCITS III do increase the freedom of an investment manager, but there are also limitations. Knowing how a fund manager has interpreted these limitations is vital to the savvy investor. Fund managers need to clarify their strategy and educate prospective advisors and investors on their particular approach to managing the fund. Advisors will also be watching for the experience of the fund manager in this more complex area with its greater demands for risk controls.

Education is always important for intermediaries, but particularly so with a new and complex product. They also appreciate having part of the their work done for them and our own research shows that the support they most appreciate from providers is marketing materials they can use directly with clients to explain the product, bringing a promotional boost to the provider with the best explanation. With the resources and access to intermediaries, the main-stream traditional fund managers have a clear advantage over their hedge fund counterparts here. By employing digital marketing strategies, niche providers could economically tip the balance of influence a bit further in their own favour.

Another factor benefiting traditional providers is the likelihood that buyers for UCITS III products will be cautious. Fund Managers can expect some initial resistance, for whenever a sector sees a wave of new launches, alarm bells tend to ring out. With so many UCITS III products launching, investors are able to be more selective, so transparency and differentiation bring advantages. Even well known names in the market may be advised, therefore, to think through the sales story for the intermediary and ensure it hits the right chord to assuage concerns and promote the positive as well as having a unique proposition.

Online Marketing

In our research, we were surprised to find little UCITS III marketing directed at the end-user. It’s possible to find press release upon press release on the web, but the language and content is certainly aimed at an educated audience. It would appear the industry is more interested in telling competitors about their latest fund launches than potential advisors and investors. Furthermore, even if inspired by the press release to search for more information, it is not easy to find mention of UCITS III products on the websites of the larger asset management firms, despite having news-worthy, recent launches.

A good example of online UCITS III marketing comes from Jupiter Asset Management, who launched two UCIT III funds at the end of last year. These products were marketed specifically as funds that have been developed especially “for top-performing fund manager Philip Gibbs” (Jupiter online) and were referred to as such consistently, throughout all web publications. Customers could read up on the new products directly on the Jupiter website, where they could also buy the product directly, of course. In addition to this, Jupiter also used Twitter to promote the upcoming product launch via the GIMagazine.

Jupiter has got ahead of the game online by integrating digital activity to promote a differentiating message consistently applied. This approach is no longer an add-on to traditional marketing, but is fundamental to taking communication beyond promotion to engagement with the target audience.

The first step a hedge fund is likely to take in seeking external marketing support is to enlist the services of a public relations agency, and rightly so, since influencing the influencers is crucial in reaching professional audiences. However, PR has changed with the rise of new media. Not only are our favourite industry newspapers and magazines increasingly consumed online, respected journalists and industry experts are talking directly to audiences via niche blogs promoted using sophisticated online marketing techniques. In order to ensure successful management of communication between the organisation and its audiences, there needs to be a clear understanding of new media and how to make use of the opportunities it creates

A recent survey of institutional analysts and investors by the Brunswick Group demonstrates the growing influence of independent online media on the investment decisions of institutional investors. The survey reports that 47% of respondents have read information on a blog that prompted them to investigate an issue further and 20% have made an investment decision or recommendation after initially sourcing information from a blog.  58% believe that new media will become increasingly important in helping them make investment decisions in the future.

Thomson Reuters, the world’s largest provider of financial news and information, believes that new media will play an increasingly important part in influencing financial services professionals in the future. Devin Wenig, chief executive of Thomson Reuters Markets Division, said that bloggers have “different rules and perspectives and can do things that we do not. Many professionals feel that both sources are relevant.” Wenig has acknowledged Reuters terminals as appearing “archaic” to the new generation of web literate financial professionals. “We are working on redefining the way financial information is presented and used” he told Hedge magazine.

While traditional PR agencies are incorporating online media as part of their offering, many are challenged in truly adapting to the new techniques required and more significantly to the philosophy behind new media. Like advertising, PR developed in the age of “push marketing”, seeking to persuade rather than to engage.  In new media, the audience answers back and often generates the conversation in the first place. Products, providers and information sources are discussed on forums as they might be in the pub, but here the conversations are recorded and shared for anyone visiting or searching to find later. While the most popular blogs may be generated by well-known industry specialists, also influential are the comments left on the blog post by the readers. You can no longer control information, but those hedge funds who move early to participate in the conversation can bring their influence to bear and benefit from the opportunity to engage with their audiences, to listen, to learn about needs and to adapt to meet them.

New Media PR goes deeper

New media is not only rapidly growing and gaining influence, it is also evolving requiring PR agencies to continuously adapt and place a new emphasis on technological competences.  Reputation management online has to begin with knowing what is being said where, using advanced search techniques and tools that can not only root out what is served on Google’s main search pages, but that can look much deeper into online information. Whatever is said online remains online unless actively removed, and most blog managers will respond to a reasonable request for the removal of negative comments, but first you need to know the comments are there. Search is therefore not only a skill required to ensure your name and website are served high in search rankings, it also lies at the heart of reputation management.

Alternatives research specialists, Preqin, report that institutional investors are now the key source of capital to hedge fund managers and their confidence in hedge funds is returning after the global crisis of 2008. They are, however, becoming increasingly demanding and, along with liquidity, transparency is a key issue for both investors and their advisors.  If properly managed, new media provides the opportunity for hedge funds to use PR to do more than the mundane press release, to open up to comment and to reassure investors of their openness and transparency.

SEI recently completed a survey of institutional investors and their perspective on hedge funds, the outcome of which was a list of four main factors Institutional Investors look for. We’ve reviewed the SEI factors, added one, and focused on how you can cater to the institutional investors needs through your website and how a good web presence can help you build and strengthen these relationships.

Historically, hedge funds have had to execute caution in regards to web presence and the remnants of this may still be affecting your choices. Wherever you find yourself on the evolutionary ladder of Hedge Fund websites, there are several factors to be aware of:

1. Transparency and Reporting

As a guide to what is possible, Goldman Sachs’ website is well worth a visit for inspiration – www2.goldmansachs.com. Ticking all the SEI boxes, their once dull and static website has been transformed into a multi functional, user friendly platform which gives a face to the business and has multiple resources to attract new talent. Although all aspects of the Goldman Sachs site may not be relevant to the average hedge fund, their approach to transparency and focus on people is exemplary.

According to the SEI survey, institutional investors’ priorities are transparency, excellent reporting and they want to see a clear investment strategy. Take a look at the Black Rock website for examples of clarity in this regard as well of great information structuring – they have a lot of it to manage – http://bit.ly/195aAf. The SEI survey also reveals that institutional investors believe well managed firms return a higher performance (54% pointed this out). Anyone accessing a financial services website will make judgements about the business and are unlikely to be inspired if the structure is poor or information static or out of date. Like a window, a website should offer a unique insight into your business for your current and future investors.

Transparent accessible information can be provided behind a personal log-in, now a feature of the majority of hedge fund sites. Companies such as GAM and Angelo Gordon and Co. make non-subscribers aware of what lies behind the wall, including downloadable status updates and reports on demand. Considering the information overload we struggle with today, it is essential that the user is able to get to the information that’s relevant to them as quickly and easily as possible. A personal login shouldn’t just give access to generic information, but should allow information to be tailored to the individual or organisation. E-mailing a PDF document is still a popular distribution method for reporting, but allowing each investor to also access a personalised webpage for tailored information brings opportunities to deliver added value and to build a relationship.

2. Differentiation

Whether you stand out for high quality products, a passionate approach or for a focus on risk management, your website should reflect that focus and differentiate you from competitors. The message should be strong and consistent throughout the website in order to build a persona that rings true with the experience of meeting up with business representatives offline. Allowing a look “behind the scenes” at the culture and work environment, imbues the company with a personality and helps to create a strong bond between you and the users.

With the bold caption: “Creativity. Experience.” and a brief history of themselves, Angelo Gordon & Co’s website conveys who they are and what they offer within seconds. Focusing on the creative approach to alternative investment strategies is the clear theme throughout their website. Where does your point of difference lie and what are the values that drive your business? The answer to these questions should be the foundation on which you build your website.

3. Institutional Quality: Infrastructure and Operations

Although many would claim to prefer a strong team as opposed to a star investor, the latter is always a favourite topic. Access to the fund manager is of great importance to any investor. Here, Web 2.0 offers a multitude of opportunities in form of video sharing. Instead of or in addition to the odd article in financial journals or speeches at conferences, the fund manager can communicate directly through the website. The main difference and benefit of this is your complete control of content and frequency, as you can record, upload and share as much as you see fit. While your star managers are the ones who promote the company at events and in the press, the website is a great place to build a profile of the team.
4. People

The trend of networking – offline and online – brings with it a movement towards the personal and approachable. Impersonal corporations and businesses are a dying breed and are being replaced by real people and real faces. For the hedge fund website, the importance of this is twofold. Firstly, it exudes a sense of security, openness and inspires trust. Secondly, it serves as an invitation for future employees. Many hedge funds have recognized this and already feature an extensive careers section on their website. Man Investments link to career and graduate opportunities, whereas Seilern Investment introduces its team through pictures and job descriptions. Again a great reference site is Goldman Sachs with very personal videos of staff at every stage of their career in the firm giving real insight into what a working day might bring.

5. Added Value

An ideal website delivers more than what’s required and demonstrates creativity, resourcefulness and opportunities for users to get involved. The larger hedge funds are already incorporating news feeds and articles onto their website. One of our favourite examples is Angelo Gordon’s “visual tour through the office”. With one click on their homepage, you can view an array of snapshots of their premises. This is impressive not only because the pictures are high quality and beautifully taken, but because it gives a unique insight into the working environment, gives a feel for the company and instils a sense of trust. Good content that’s updated on a regular basis, distributed pictures and videos, result in a higher SEO result. Again, this is beneficial in matters of recruitment as well as catering to the expectations of institutional investors.

Links for inspiration:

http://www.angelogordon.com/index.cfm

http://www2.goldmansachs.com/

http://www.seilerninvest.com/home.html

http://www.maninvestments.com/global/about-us/careers.html