FAQ: Investment Management Branding Expertise

Understanding Brand Trust in Asset Management

Trust is a critical asset for investment managers, financial advisors, and asset management firms. With financial services consistently ranking as one of the least trusted industries according to the Edelman Trust Barometer, building a trustworthy brand is essential for attracting and retaining clients. This FAQ addresses the most common questions about establishing trust through strategic branding in the investment management industry.

Frequently Asked Questions About Investment BrandING and Building Trust

Why is brand trust especially important for asset managers?

Trust is particularly crucial in financial services because:

• Financial services consistently ranks as the least trusted industry in consumer surveys (54% trust rate)
• Only 33% of Americans feel they can trust their fellow citizens, making institutional trust even more valuable
• Investment decisions involve significant risk and emotional factors
• Trust has been empirically shown to be the biggest differentiator when clients hire investment advisors
• Trusted brands enjoyed increased inflows even after the 2008 financial crisis
• Clients consistently rank trust as the largest factor in whether they will refer others or expand relationships

How does branding affect asset gathering for investment managers?

Effective branding impacts asset gathering in several measurable ways:

• Creates a platform to drive growth beyond existing client relationships
• Makes clients more likely to stick with you during market downturns
• Increases likelihood of client referrals (the most cost-effective client acquisition channel)
• Attracts the clientele most compatible with your investment philosophy
• Allows you to better target specific market segments (institutional, retail, or intermediary)
• Sets clear expectations about investment style and performance patterns

Do sophisticated institutional investors really care about branding?

Contrary to what many believe, research shows institutional and B2B investors are more influenced by emotional factors and brand connections than retail investors:

• B2B buyers with high brand connections show 79% consideration rate vs. 15% without
• Purchase rates are 64% with strong brand connections vs. 5% without
• Studies show B2B buyers are willing to pay premium pricing (60% vs. 2%) when strong brand connections exist
• CFA’s Global Survey found brand importance jumped from 33% to 46% among institutional investors

Why do large asset managers continue to capture most AUM growth?

Large money managers have inherent branding advantages:

• Consolidation in asset management has increased the market share of the top 10 managers from 5% in 1980 to almost 25% today
• Name-brand recognition creates a size bias in their favor
• Familiar brands are more likely to be trusted during periods of uncertainty
• M&A activity has reached 8-year highs of over $40B in deals
• Trusted brands have resonated particularly well in the past 15 years

How do smaller investment managers compete with established brands?

Smaller and boutique investment managers can successfully differentiate through:

• Specialization in alternative investments or niche strategies
• More personalized service and customization
• Better articulation of their unique expertise and investment process
• Consistent messaging that clearly communicates their differentiators
• Thought leadership content that showcases specialized knowledge

What are the key elements of an effective investment brand?

An effective investment brand should include:

• A clear articulation of your unique value proposition
• Messaging that addresses both rational and emotional client needs
• Consistency across all touchpoints (website, pitch materials, client communications
• Design aesthetics that reflect the sophistication of your investment approach
• Authentic representation of your firm’s culture and values
• Regular content that establishes thought leadership
• Language that avoids generic industry claims like “high risk-adjusted returns”

How can investment managers measure the effectiveness of their brand?

Brand effectiveness for asset managers can be measured through:

• Growth in assets under management (AUM)
• Client retention rates during market downturns
• Referral rates from existing clients
• Website traffic metrics and search engine rankings
• Email marketing engagement rates
• Social media following and engagement
• Conversion rates from marketing materials to client meetings

What common branding mistakes do investment managers make?

Common branding pitfalls in investment management include:

• Using generic messaging that fails to differentiate (“client-focused” or “high risk-adjusted returns”)
• Neglecting to address investors’ emotional needs and focusing solely on performance
• Inconsistency across marketing channels and materials
• Outdated visual identity that doesn’t reflect the firm’s current positioning
• Failing to articulate clear differentiators from competitors
• Not aligning brand promises with actual client experience
• Overlooking the importance of digital presence and accessibility

How has investment branding evolved in recent years?

Investment branding has evolved significantly:

• Trust in financial services has increased from 48% to 54% over the past five years
• Brands are increasingly used as proxies for trust by investors
• Digital and technological capabilities are now highlighted alongside financial expertise
• ESG and social responsibility messaging has become more prominent
• Emotional connections are emphasized more than in previous decades
• Content marketing and thought leadership have become essential components
• Greater emphasis on authentic storytelling versus technical capabilities

What are the benefits of working with an agency with investment management branding experience?

Investment management firms are able to save resources when they work with a branding agency that has specific expertise and experience in the asset management industry. They save time and internal resources in less rounds of review and a better initial understanding of the nuances of different investment management approaches and how to depict that visually and through thoughtful content.

Investment managers also get better output from specialized investment branding firms that are able to better understand and articulate complex investment topics and concepts throughout their branding and materials. This in in the form of more effective design, brand strategy and messaging – brand execution that is able to reach and connect with investment-related target audiences.

For more information, please see a detailed article on the Brandability of Trust in Investment Management.

Contact MBC for strategic assistance to invent yourself, reinvent your firm, or to generate additional results from your marketing and communications efforts.