Below are 5 brief observations that I have witnessed in institutional marketing fails.
1. Deficient Marketing Strategy and Capabilities
By peering on the biography page of a fund managers’ website, in some cases a number of professionals have MBAs, yet it seems many skated through marketing class. The reality is that a solid number of asset managers do not have a dedicated marketing professional who has finesse to grasp the institutional landscape. Filling out RFPs is not marketing a strategy. Paying placement agents or third-party marketers can work, but it is expensive (eating the fee) and can bring on a set of legal risks.
Another observation is the posting of white papers on company websites (aka blackhole). Most asset managers have anemic online traffic compared to financial media portals – who is going to read it? Currently, the majority of asset managers are deficient in effective content marketing distribution and tactics. Utilizing a proper financial media distribution channel is paramount to sharing one’s research to the right audience.
2. Lack of Brand Professionalism and Commitment
After hearing a story about an asset manager, the first thing a potential client will do is probably “google” the company. What shall they find?
The year is 2014 and still – a good number of assets managers lack a professional looking website, or even a website presence at all. Some investment consultants believe that maintaining a functional website is a fantastic way to be transparent and forthcoming to one’s client.
How can one expect to raise billions in capital (globally), if one cannot tell their story and proposition to the world?
3. Popular Kid Syndrome
The institutional investment business is a relationship intensive segment compared to other investor classes. Occasionally I encounter meetings where an investment executive tells me, he or she has all the connections in the public investor world. I then ask, “Why are we talking then?”
A short pause…..
Executive resumes speaking, “we want to network with public pensions and sovereign wealth funds.”
Managing global institutional investor relationships is an ongoing, complex process. Usually, public institutional investors are looking for long-term partners, especially in terms of thought leadership.
4. Improper Investor Targeting
The majority of U.S. asset managers heavily rely on U.S. public pensions or defined contribution plans. This is a no brainer as the United States is the country with the most retirement assets. For defined contribution, many plans select the brand name asset managers, popular funds or ETFs as potential choices. From a business standpoint, one of the fastest growing investor segments is sovereign wealth funds compared to U.S. public pensions which possess a slower growth rate.
>> Today sovereign funds stand at over US$ 6.3 trillion in assets.
|2012 Figures||Billions USD|
|Total US Pension Assets||16,851|
|Total SWF Assets||5,198|
|Total UK Pension Assets||2,736|
|Total Australia Pension Assets||1,555|
|Total Canada Pension Assets||1,483|
|Total Global Pension Assets||29,754|
SWF Highest Growth Rate in Terms of Asset Growth
Source: Towers Watson Global Pension Assets Study 2013, SWF Institute
5. Being Uneducated
Reading a white paper or Financial Times article on Gulf sovereign wealth funds does not make one a guru on sovereign wealth funds. It is imperative to understand one’s future client and consume a variety of sources of information or specialized research to be kept up-to-date.
This article is written by Michael Maduell and his opinions are his own and not officially of the Sovereign Wealth Fund Institute.
If you thought red meat-centric investments ended back in 2007 with Trump Steaks, think again. Singaporean sovereign wealth funds Temasek Holdings and GIC Private Limited are reportedly working alongside London-based Metric Capital Partners to buy a US$ 200 million minority stake in D.ream Group, according to the Financial Times. An entertainment-focused subsidiary of Turkey’s Doğuş Group valued at nearly US$ 1.5 billion, D.ream owns of a number of high-end dining establishments – including the steakhouse chain founded by Turkish chef Nusret Gökçe, better known on social media platform Instagram as Salt Bae.
[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
Mitsubishi Corporation sold a 5% stake in Capula Investment Management LLP, a hedge fund, to Dai-Ichi Life Insurance Company.
Mitsubishi sold the stake to focus on other areas of investments such as real estate and logistics.
Mitsubishi acquired the hedge fund stake in October 2008. Capula Investment Management was formed in 2005 by Yan Huo and Masao Asai, as a spin-off from Mitsubishi UFJ Securities International. In 2012, the Petershill fund managed by Goldman Sachs acquired a 20% stake in Capula Investment Management.
OMERS Infrastructure Management, formerly known as Borealis, signed an agreement to buy Leeward Renewable Energy, LLC, a U.S. wind-power developer, owner and operator from affiliates of infrastructure management firm ArcLight Capital Partners, LLC. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
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