Global regulatory initiatives continue to be the single biggest strategy driver in the financial industry. The resulting consolidation and bifurcation into full-service asset gatherers and specialist alpha providers is well-documented.
I argue that the implications to the field of marketing of financial products and services are an opportunity to stand out from the crowd, instead of complaining with them about the inevitable.
Whereas in the past, successful investment firms marketed their individual product in the prospect’s portfolio context, and beating those who tried to sell on past performance alone, today the real value proposition is helping clients to navigate their regulatory environment.
Both individuals and institutions continue to strive for tax efficiency, particularly with cross-border investments across various asset classes and product structures. Institutions additionally face challenges complying with capital adequacy and other provisions such as Solvency II, Basel III, FATCA, MiFID, et al., in addition to a myriad of country-specific legislation.
Today, being able to work with the client’s legal solutions team separates the winners from the players.
Increasing restrictions on direct financial product promotion do not only protect private and institutional investors, they are also a blessing for the providers themselves. These restrictions force them to position themselves as a knowledge business first.
Differentiated corporate branding and marketing replace traditional me-too product sales, which mostly rely on past fund performance.
There is an opportunity on the marketing communications side as well. Consistent messaging that is fair and not misleading has always been key to building and protecting a firm’s reputation. Today, clients and regulators demand full disclosure of potential risks and opportunities in plain, understandable language.
Being able to communicate to them clearly and consistently has become an actual cornerstone of active risk management. This applies to the first touch-point with a brand, the various presentations and investment proposals, due diligence documents, to the offering and registration materials, all the way to investor and regulatory reporting.