The financial landscape is in a state of flux, a truth underscored by the recent performance of the Australian superannuation industry. After weathering the challenges of 2022, the industry experienced a notable rebound in 2023, with total assets climbing by 7.6% to surpass $3.5 trillion. This resurgence is not only isolated to Australian super funds; it mirrors trends in global asset management, where markets have shown resilience in the face of economic uncertainty. However, this recovery unfolds against a backdrop of increasing economic pressures on consumers, with rising living costs intensifying scrutiny on the financial services sector, particularly concerning fees, performance and marketing activity.
In this environment, super funds and asset managers must rethink their marketing strategies to not only minimise costs but also address evolving client sentiments, emphasising transparency and value.
Understanding the shifting economic landscape
The global economic environment remains volatile, with inflationary pressures, geopolitical tensions, and shifting interest rates creating a complex backdrop for financial markets. The performance of superannuation funds, asset managers, and other investment vehicles has become increasingly tied to these macroeconomic factors, requiring firms to stay agile in their marketing and communication efforts. This has seen that 67% of marketers worry about reducing spending while staying ahead of competitors.
“ In such an environment, super funds and asset management firms worldwide must rethink their marketing strategies to align with the evolving sentiments of their members and clients.”
The Australian superannuation industry’s 2023 rebound is a case in point. While the 7.6% growth in assets reflects a recovery, it doesn’t negate the challenges posed by prior market contractions. Additionally, the cost-of-living crisis in Australia and similar pressures in other developed markets means investors and members are more acutely aware of the impact of fees on their returns. This heightened awareness isn’t limited to superannuation funds; it extends to the entire asset management industry, where transparency and perceived value have become crucial differentiators.
The global relevance of Australian superannuation trends
While Australia’s specific regulatory and market conditions are unique, the broader trends affecting its superannuation industry are relevant to financial services firms worldwide. The pressures Australian super funds face—such as balancing growth with cost efficiency and navigating member expectations in a volatile market—are shared by super and pension funds globally.
Similarly to Australia, despite market volatility global pension funds grew by 11% in 2023. This global alignment of challenges and volatility underscores the need for a more nuanced marketing approach. Super and pension funds not only need to communicate their resilience and growth in the face of market volatility but also provide a clear rationale for the fees they charge. This requires a shift from traditional marketing tactics to strategies that prioritise transparency, education, and value-driven messaging.
Cost-efficient strategies to match social sentiment during market volatility
Given the current economic pressures, super and pension funds must be particularly attuned to the sentiments of customers and members. When individuals are facing financial strain, they are less tolerant of what they perceive as excessive spending by the institutions managing their money. This presents a unique challenge for marketers in the superannuation and asset management sectors; you must balance the need to promote your services with the necessity of demonstrating fiscal responsibility.
One of the key considerations for super funds and other finance brands is the perception of marketing expenditures. In times of economic hardship, members are likely to be critical of marketing campaigns that appear extravagant or out of touch with their financial realities. This criticism can be particularly sharp in the superannuation industry, where members are acutely aware their funds are being used to finance such campaigns.
”While large-scale marketing efforts like paid partnerships or above-the-line advertising may seem like the easiest way to achieve mass reach, their high costs and lack of tangible value for members will face scrutiny during economic pressure,” says The Dubs Agency head of strategy, Alexandra Middleton. “To navigate this delicate terrain financial marketers need to put audience, not brand, first and build their strategy around delivering value at every stage of the funnel.”
Marketing should focus on conveying the value your brand provides as well as addressing the needs of your audience, even if it means stepping back from brand messaging or direct promotion. To do this effectively financial marketers need to identify the key topics that are relevant to their audiences in the long-term and build big rock content pieces that allow them to own the topic in market. Minimising investment in multiple marketing initiatives, these big rock content pieces can then be atomised to provide multiple opportunities to reach your audience using messaging that really matters to them. The Big Shift is the perfect example of this.
“From one big rock content piece a finance brand could produce awareness, consideration and conversion content year-round, simply by honing in on different angles within a big rock content piece,” says Middleton.
At an awareness level, this could involve using creative in-feed social content to engage audiences on the trends and topics that interest or concern them. Consideration content then provides an opportunity to introduce your brand, educate your audience and solve their needs, often through more editorial content. It can also be an opportunity to address barriers to entry such as performance and fees. Here funds can highlight past performance and explain the rationale behind fees as well as the strategies in place to protect and grow member assets. Transparency and education are critical components of this approach. By demystifying the fee structure and clearly articulating how those fees contribute to long-term growth and stability, you can build trust and reduce scepticism among your members. Having built a connection with your audience and addressed their needs, atomised conversion content can then focus on practical tools and resources that ultimately drive your audience to take action.
Leveraging data and insights to drive marketing effectiveness
The use of analytics can help identify emerging trends in member sentiment, allowing you to proactively address concerns before they become widespread issues.
For example, social listening tools can be used to gauge member reactions to market fluctuations and adjust messaging accordingly. If members are expressing concern about market volatility, marketing campaigns can be tailored to reassure them by highlighting the fund’s risk management strategies or long-term investment approach. Similarly, segmentation analysis can help identify different member groups based on their financial situation, enabling more personalised communication that resonates with their specific needs and concerns.
Strategic marketing in an era of market volatility
The financial services industry is at a crossroads, where the interplay between market performance and member expectations is more complex than ever. For superannuation and asset managers, the key to navigating this environment lies in adapting marketing strategies to reflect the realities of the economic landscape and the evolving sentiments of your members.
By focusing on transparency, education, and value-driven content, you can not only weather the current volatility but also strengthen your relationships with members and clients. In doing so, you position yourself not just as custodians of wealth but as trusted partners in your members’ financial journeys, capable of guiding them through both the peaks and troughs of the market cycle.
