We hold these truths to be self-evident...
These words introduce, not only our nation’s founding principles, but also the attitude investment firms sometimes take when drafting their investment management marketing messaging.
I’ve written before about all the reasons why investment managers would be wise to avoid relying on performance numbers when creating and executing their marketing strategy.
To sum up, good-to-great performance numbers aren’t all that unusual.
Let's say you run a large cap growth portfolio. According to eVestment, there are 425 domestic, long-only large cap growth products against which you are competing. That means that even if you fall into the top decile, there are 42 other firms with similar performance. Top quartile? Over 100.
Without an effective marketing message and distribution platform, nobody has a compelling reason to care about you. Performance does not make you special. It's that simple.
The 6 Ps
I’ve been thinking, writing, and working on pitchbooks a lot lately. As any decent investment management firm’s sales and marketing team can attest, pitchbooks must address the “6 Ps”:
But the 6 Ps are only one part of the marketing equation. The other?
There’s an old political expression: Campaign in poetry, govern in prose.
In short, it means that politicians need to appeal to people’s hearts when making the case for their political vision, but understand that politics is a transactional business; one in which the real world sometimes forces us to make compromises in order to get things done.
The Poetry, the Prose
Insofar as how this relates to investment management marketing, it means that the prose (6 Ps) which describes the sausage-making of portfolio management cannot be allowed to overshadow the poetry (marketing narrative) your firm should recite to its prospects.
Another way of looking at it is to think about marketing as storytelling. Why?
Because stories are what help us to connect with each other, and have so for tens of thousands of years.
In your marketing message, what is the predominant message? Can you even identify one? When describing what you do, how you do it, and why, what are your main points of emphasis? Are they data-driven, or story-driven?
But what do I actually mean by “story?”
Storytelling in Investment Management Marketing
In an earlier post, I wrote:
“Investment management pitchbooks are an aid for what is, in essence, a job interview. And when an interviewer says, ‘Tell us a bit about yourself,’ he or she doesn’t want your biography. The question really means: How can you help us? Specifically, what in your background and experience will allow us realize our goals?”
When I speak of storytelling, THAT’S the story investment managers need to be telling, not a lengthy recitation about the origins of the firm and every victory and defeat along the way. If those stories help to describe your value proposition and how your firm helps clients to fulfill their goals, great. If not, save them for another time.
Investment management marketing needs to succinctly and clearly explain how the 6 Ps work in unison to help a client to reach their goals.
That is THE story that needs to be written, refined, and crafted into a compelling narrative if a firm hopes to create a semblance of differentiation from its competitors.