How asset managers respond to a crisis

Asset managers have changed their advertising messaging and purposes throughout the Covid-19 crisis

Key points:

• In Europe, brand advertising increased at the expense of insights and fund promotion during Q3 of 2020, and the amount of fund promotion dipped below that of insights for the first time since the beginning of 2019
• As the virus continued to spread across the globe, asset managers changed their advertising towards promoting 'safer' investment strategies. This is particularly obvious when looking at advertising trends in North America and Asia Pacific
• Similar to Europe, brand advertising dropped during Q2 and Q3 in North America and Asia Pacific

Asset managers continue to shift their advertising purposes and the investment strategies they promote as the Covid-19 crisis evolves, data by Fundamental Media reveals.

Using data from Fundamental Monitor, our proprietary technology tool providing real-time insights into the advertising campaigns by asset managers across the globe, we looked at asset managers' advertising messaging and noticed a shift in the types of messages asset managers were promoting during the Corona crisis.

Europe

Throughout 2019, the proportion of ads dedicated to brand, insights and fund promotion in Europe were fairly stable:

• Brand 36% - 44%
• Insights 15% - 24%
• Fund promo 34% - 44%

This continued into the first quarter of this year, even though total volumes were considerably down. However, as we came to Q2 and the pandemic started to really take hold, there was a huge decrease in the amount of fund promotion going on, and at the same time the volume of insights promotions went up by the same amount. Then in Q3, brand advertising increased at the expense of both others, and the amount of fund promotion dipped below that of insights for the first time in the entire period.

When we look at absolute numbers to compare the average volume per advertiser from Q3 2019 to Q3 2020, we see some stark differences:

• Brand Q3 2019 745,514; Brand Q3 2020 552,575 (down 24%)
• Insights Q3 2019 318,547; Insights Q3 2020 430,857 (up 35%)
• Fund promotion Q3 2019 846,763; Fund promotion Q3 2020 476,808 (down 44%)

This clearly indicates that a much higher proportion of those advertisers that are in market now are deploying thought leadership as a key part of their strategy than at the same time last year, and that straightforward product push has taken a massive hit.

This is borne out when looking at the number of individual landing page URLs of each type being promoted. Again, when comparing Q3 2019 to Q3 2020, the number of both brand landing pages and fund promotion landing pages has decreased markedly, but the number of insights landing pages has actually increased slightly (although it has to be said that Q3 2020 has had the third-fewest insight promotions of any quarter during the period).

North America and Asia Pacific

As the virus continued to spread across the globe, asset managers changed their advertising towards promoting 'safer' investment strategies. This is particularly obvious when looking at advertising trends in North America and Asia Pacific.

In Asia Pacific, the number of advertisements promoting fixed income continued to rise over the year so far, while the number of digital advertisements for equities dropped significantly after Q2, once it became obvious that the pandemic would not be over as quickly as everyone had hoped. The promotion of ETFs also grew significantly, with asset managers positioning ETFs as a liquid alternative.

However, this trend is only partly in line with the shift in investor interest during the crisis. Research by Fundamental Media has found that engagement with social media posts on fixed income was particularly high during Q1 but dropped during Q2 when investors started focusing more on how to deal with the volatility the crisis has caused and what this means for portfolio allocation.

In North America, we are seeing that asset managers have dropped the advertising of almost all investment strategies in favour of their ETF offerings, as investors are looking for allocations that are sufficiently liquid in times of distressed markets and liquidity crises.

Similar to Europe, brand advertising dropped during Q2 and Q3 in North America and Asia Pacific. In both regions, the number of advertisements promoting thought leadership rose significantly in Q2 but then dropped again in Q3. While fund promotion has also dropped when comparing Q1 to Q3, it remains the top advertising method for asset managers in both North America and Asia Pacific.

All data comes from Fundamental Monitor, an innovative technology tool developed by Fundamental Media providing real-time insights into the advertising campaigns by asset managers across the globe

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