When investment managers go before a prospect, be it an investment committee, private client, or anything in between, the instinct is to focus primarily on their investment process.
It’s not surprising. After all, it’s the subject managers feel most comfortable discussing, and is where most believe their core differentiation lies.
I’ve long argued that investment managers should focus their differentiation efforts less on what they do and more on who they are: one excludes a whole host of potentially relevant selling points; the other does not.
Still, I know some habits are deeply ingrained, and thus asking tigers to change their stripes isn’t necessarily the best prescription for improving a firm’s investment management marketing strategy.
Sometimes, then, rather than a dramatic rethinking of an approach, it can be better to use a few hacks that allow managers, marketers, and salespeople to better illustrate the efficacy of their approach within the confines of their experience and comfort zone.
“Unique” is a Tough Sell
Here’s the problem: there are only so many ways to conceive of and execute an investing strategy. There are very few strategies that are unique, with most being some variation on an existing theme.
Firms need to know that when an investment committee or individual investor is listening to their pitch, chances are they are hearing something not entirely dissimilar from what other firms are saying as well.
Growth vs. Value? Long vs Short vs Long/Short? High quality vs. low quality/high yield? Conservative? Aggressive? Opportunistic? Disciplined?
It’s for this reason asset managers, even ones that have spent years developing and refining their processes, and truly believe that what they do IS differentiated, need to take a step back and look at it from an outsider’s perspective:
“Oh. So yours is a long-only approach that focuses on quality? Got it.”
“No, no, wait! You don’t understand. Our screen helps us to uncover pockets of underappreciated quality at a reasonable price our competition misses.”
“What’s the average market cap of the companies in your portfolio?”
“Around $10 - $15 billion.”
(Thinking to themselves) “$10 billion? $15 billion? Those don't sound like companies flying under the radar to me…”
Is our prospect being obtuse here? Perhaps, but it’s your job in the pitch meeting to strip away that cynicism and describe how your firm can solve their needs and concerns in a way that’s more effective than your competition.
Showing, Not Telling
We all remember the admonition from our 8th grade English teachers:
Show, don’t tell. In other words, don’t just say “The hamburger was good.” Be more illustrative:
“The hamburger was cooked to perfection. The soft pretzel bun, mild cheddar cheese, and spicy jalapeños left me unable to decide if the flavors were more reminiscent of Oktoberfest or Cinco de Mayo. Then I realized it didn’t matter: it was simply delicious.”
Be descriptive in the language you use.
What’s a “Good” Story?
Research into effective marketing techniques in recent years all point to one truth:
Storytelling, as a marketing strategy, is effective. In fact, our brains are hardwired for it.
So, what is a good story and how can we tell better ones - ones that help our prospects to see for themselves the efficacy of our approach?
Good stories do a few things:
- They have a conflict and a resolution
- They reveal a truth about ourselves, either as individuals or as part of the human condition
- They entertain
It’s a non-inclusive list, to be sure, but it gives us a start.
Apply Effective Storytelling Techniques to Investment Management Marketing
By crafting a story around their investment process, investment management firms can continue to use their process as the focal point of the meeting, but do so in a more client-centric way.
Prospects must be able to see themselves in the story, so, for example, use an endowment example for an endowment prospect, a pension fund for a pension fund, an individual investor with similar asset size and goals, etc.
Center your story around a case study on how your firm’s process helped a client similar to the prospect to achieve their goals.
Pitch meeting storytelling should include the three characteristics above. Here are a few ideas on how:
Conflict and Resolution.
Here, the conflict can have a few different components:
- The client’s goals & what’s been keeping them from achieving them, PRIOR to your being hired;
- The difficulties and challenges your firm encountered in the course of serving the client (g.: market turmoil, client meddling, pitfalls & how your process helped you to avoid them).
Importantly, there has to be something unique to your firm in the way you handled the adversity.
Sure, yours is “a long-only approach that focuses on quality,” for example, but describing the way your investment process has actually solved specific, real-world client problems - the types of problems encountered by the prospect sitting before you - is a powerful asset.
It says, “While the what might not be revolutionary, who we are and how we do it is, if not unique, then highly uncommon.”
Or, put more succinctly, “We solve problems exactly like the ones you face.”
Uncovering Universal Truth
Relatedly, the story should give the prospect some idea on how your firm handles adversity.
This is one of the most explored facets of the human condition, but it offers your prospects valuable insight into what makes your firm worthy of consideration.
What sorts of adversity can you explore? Most effective would be to show how your process specifically helped you to persevere in the face of challenges, both common and unexpected (i.e.: sudden market decline or the departure of a key stakeholder in the firm).
And don’t leave anything to the imagination – spell out clearly what you think it says about your firm’s processes, people, and culture.
Entertain
It takes practice, but speaking naturally, persuasively, and dynamically (like you’re at a cocktail party) is the best way to engage the audience (sans booze, of course).
In the end…
Ultimately, the goal of the story should be to allow the prospect to imagine themselves in the story, and experience the highs, lows, and eventual success for themselves.
How well does your website tell your story? Click or tap below to find out:
