Next year is certain to bring a new wave of change within Hedge Fund marketing. As typically the case in financial marketing, the first movers (of all sizes) to integrate the benefits of modern marketing and brand building into their plans and execute, will further widen the gap between asset gathering winners and losers. It is possible to touch new ground without breaking it.
With that said, 2015 is around the corner and many Funds are catching up or increasing momentum in their marketing. The view that marketing is an expense is going away as the realization that investing in marketing yields tremendous results. Here are a quick six predictions. Hedge Funds will:
Learn to tell their complex stories simply
As Einstein said, “If you can’t explain it simply, you don’t understand it well enough.” Having the ability to simplify your story enables institutions, consultants and advisors, to accredited investors to better understand, remember and recognize your firm. Going through a discovery process with an outside firm (yes, a shameless pitch) also allows your entire firm and host of supporters to have a clear picture of who you are, what you do, and perhaps most important, what differentiates you from other Funds.
Learn how to tell their stories efficiently
Does your business move forward one phone call and one event at a time? Or has modern outreach arrived at your firm? We predict that many more firms will create engagement programs with hundreds, or even thousands of prospects simultaneously. Today only a handful are using these tools and processes. The process to touch investors and influencers at all different levels of understanding your investment thesis, process and alpha generation creates a steady, quality prospect pipeline. 2015 will be the year that many firms, even those beyond the top 30, without established brands, will make the investment and reap its rewards.
Touch people beyond their current marketing team’s contact list
With today’s technology and within compliance standards, Hedge Funds can reach a broader universe of investors. Hitting the marketing team’s same contact list is limited and produces diminishing returns, which we believe will be highlighted in 2015. Sending the same people, the same materials over and over again, yields the same results (there is a word for this I believe). Hedge Funds will begin to target new segments of (the most likely) investors directly: desired investors, new investors, focusing on those they haven’t worn out.
Embrace marketing technology
Today’s technology brings leverage, operational efficiencies and the ability to handle more prospects and clients. There are many avenues through which to travel from CRM, to databases to using one’s web site to its fullest. We predict that technology will first be used for operations more effectively, and for the more visionary firms, outreach and digital strategies will emerge.
Tie marketing investors with relations, more closely
The term “user experience” will be added to the vocabulary of funds that are focused on growth. Onboarding, training, Extranet, reporting, and staying ahead of the news will be shared responsibilities across departments at many management companies. Preempting investor’s calls through a more proactive approach will be the standard client service – a seamless move between portfolio management, reporting, bus/dev and IR for Funds seeking to differentiate themselves.
New Fund launches will be common, many Funds will gain major allocations
We have all read the headlines about this year’s record Fund closures. As in any industry, weak, also ran, and the underfinanced will be forced to close. Launching any business requires capital and developing a brand beyond past pedigree. Adding value is the key. Communicating that value is marketing’s job. We predict many high quality launches. We also predict that some of the bifurcation of asset gathering migrates away from the top thirty funds (as measured by AUM), and not necessarily to new managers.
Allocations will find their way to managers that communicate clearly, to the right potential investors (and their consultants), consistently and with quality. It is how my firm (I am a former manager) raised assets, and it is how forward thinking (read: our clients) will as well.