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Money Management

Seeking an edge, more managers beef up websites to woo clients

Institutional money managers' websites — long saddled by jargon and vague investment descriptions — are playing a more important role as a portal for showcasing managers' capabilities in an increasingly competitive industry, sources said.

Managers are using their websites not just to introduce themselves and put out their contact information, said Andrew McCollum, managing director, investment management, at financial consultant Greenwich Associates, Stamford, Conn. The sites also have become a major part of the firms' overall institutional marketing strategy as pension fund executives do more of their own research apart from their consultants, he added.

"There's an evolution in how institutions consume information," he said. "Younger officials will use websites, LinkedIn, social media. Older executives will rely on their consultant or their staff, but their staff is being influenced by more digitally accessed information like thought leadership."

Mr. McCollum said manager websites historically have been "more of a reactive tool, a static property with basic messages. What's changed now is that the website is no longer a static tool. Managers that get this are driving visits to their website through things like thought leadership and, by doing that, obtaining information on prospective clients."

Mr. McCollum noted it is important to look at the development of websites in the context of the maturing of the money management industry.

"As the industry hits an inflection point from a growth industry to a mature industry, it's become more competitive," he said. "That requires institutional managers to create a marketing strategy. A website is one tool for getting their message out."

The websites of Putnam Investments LLC, BlackRock (BLK) Inc. (BLK) and Pacific Investment Management Co. are examples of good institutional client websites, he said.

But smaller managers looking to build their institutional business also are looking at their websites to drive more interest in their firm and their strategies, said Tammira Philippe, president and CEO of $10.4 billion long-only quantitative equity manager Bridgeway Capital Management Inc., Houston.

"We're thinking of the website as building trust, not to erode trust," Ms. Philippe said. "As we're looking to serve more institutional clients, we spend a lot of time in trying to make our website help us do that. But we're honest enough to say we have a long way to go."

Ms. Philippe said her firm has tapped its current marketing and operations teams for input on improving its website.

"We will seek stronger technical infrastructure and data management capabilities that will allow us to efficiently produce and deliver high quality content," she said. To that end, the firm this year completed a study by money management technology consultant and provider Cutter Associates to assess Bridgeway's digital marketing infrastructure, including its website.

Added Fergal McGovern, CEO of VisibleThread Inc., a Dublin-based software provider and website analysis service: "Asset owners are accessing manager websites first as a means of going directly to the source. That's happening more and more in financial services. And if those websites are too complex or hard to read, they'll just go somewhere else."

VisibleThread in a report on financial services websites earlier this summer said most money managers' websites ranked poorly in terms of content.

"As a group, financial services content is poorly written. Even the top-ranked websites don't meet expected standards," the report said. "Content clarity is poor industrywide." However, the report said Putnam had the highest ranking in terms of readability of all managers' websites studied.

Mark McKenna, head of global marketing at Boston-based Putnam, said the company's website for institutional investors serves as a clear introduction to Putnam's capabilities, performance and thought leadership, ultimately "opening doors" to direct meetings with sales and client service employees "because people are finding this interesting."

To build its website, Putnam in 2017 hired a full-time writer with a journalism background to produce global markets stories for its institutional clients, backed by a content strategy director, an editorial review manager and an account manager who provides business strategy input "and is dedicated exclusively to the institutional business," Mr. McKenna said.

"By the time (institutional investors) come to Putnam, they're highly informed," Mr. McKenna said. "This already happens in retail (sales). People go to the stores after visiting their websites. They know what they want to buy and what it costs. What we do is remove the doubt from the prospective client. They review our website content, subscribe to our custom content and view our videos. … Back in the day, some of this could have been a PowerPoint presentation to clients, but now it's web first."

Traffic to its institutional-targeting content has jumped in the past year, Mr. McKenna said. For example, web views on Putnam's global macro report have increased 28% since August 2017.

He said while content on the site is promoted mostly through the institutional homepage itself, "paid and organic search both play a key role in bringing users to the institutional site. For example, year-to-date July 31, organic search drove 50% of visits and paid search drove 21% — meaning search helped contribute 71% of traffic to the site."

Greenwich's Mr. McCollum, who also serves on the board of the firm's $100 million 401(k) plan, said looking at manager websites in advance helped in a recent search for an international equity manager to run one of the plan's options.

"We went to managers' websites to read their thought leadership," Mr. McCollum said. "It helped us whittle down prospective managers. It's an example of how important websites can be to provide introductory information."

Past issues surrounding manager website content included jargon rather than direct, understandable wording that was used to convey details on investments and operations, said Jim Ware, founder, Focus Consulting Group LLC, a Long Grove, Ill.-based money manager consulting firm.

"When we start working with a firm, we ask for a pitchbook with an organizational chart and ask for a description of their strategy," Mr. Ware said. "They say, 'they have a disciplined process,' or 'we use a filtered process.' That doesn't tell me anything. But that's what they also say on their websites. It's usually something like that and who's the CEO, their picture and background. There's no mission statement on the website."

Mr. Ware said managers often hire branding firms to design and populate their websites that don't really know anything specific to financial services. "The branding message — 'a disciplined shot, a strict investment process' — really? You spend $200,000 to bring a firm in to write generic, vanilla stuff like this?" he asked.

Focus doesn't make recommendations to manages on branding, Mr. Ware said, "but if we did, we could advise (managers) on how they can say they're different from others, tell them they really ought to tout that."

VisibleThread's Mr. McGovern added that managers have been more comfortable with resorting to jargon and vague descriptions of investment strategies, but now, "if a website isn't meaningful, it won't serve a purpose as a window to your firm."

A common concern among money managers, Mr. McGovern said, is getting website content approved by their compliance departments. But that's changing as managers take a closer look at the content.

"Those managers ahead of the game understand the difference" between using what some might consider safe, vague terminology and providing basic but essential information about their firm and its investments, Mr. McGovern said. "They understand they need to look at their sites from an outside-in perspective. The progressive side of web design is looking at answering a viewer's basic questions. The poor compliance officer is nailed with being the culprit to keep websites from doing that."

Still, Mr. McGovern said, most managers haven't gotten "ahead of the game." Has VisibleThread seen any improvements overall in the industry on money management content clarity since the first study in 2016? "Not materially," he said. "The industry isn't any better with this than they were two years ago."

Focus' Mr. Ware agreed, adding most managers he works with aren't concerned. In an informal survey of seven money management clients on whether their websites deliver new business to the firms, six said no and one said yes but as a part of a broader marketing strategy.

"But it's a timely discussion," Bridgeway's Ms. Philippe said. "We're discussing it, and I know other money managers are discussing websites as well."