Most asset management firms have reduced — and will continue to reduce — the amount of money they spend to lure financial advisers to their mutual funds, a study has found.
Most asset management firms have reduced — and will continue to reduce — the amount of money they spend to lure financial advisers to their mutual funds, a study has found.
According to a report from Cerulli Associates Inc., organizations and firms socked by the financial downturn are cutting promotional programs, literature and advertising aimed at advisers, due to falling revenue and budget cuts.
For instance, 57% of the more than two dozen firms surveyed by Cerulli in May planned to reduce the number of customized one-time marketing materials for new products targeting a specific audience.
“They used to market specifically to registered investment advisers or specifically to wirehouse advisers,” said Cindy Zarker, director of the assessment management practice for Cerulli Associates of Boston.
“Some of the differences in the materials were really nuances, and when the budget cuts happened, they realized it wasn't critical."
Instead of spending money to produce hard-copy versions of these materials, 85% of the surveyed firms said they would offer customized materials through their website, eliminating the cost of printing.
Firms are also spending less on advertising to attract advisers, and when they do advertise, they are choosing to do so online because it is less expensive.
The study showed that 60% of asset managers planned to increase their advertising on the Internet, compared with just 21% that planned to increase advertising in trade print publications and 7% that planned to increase advertising in consumer print publications.
