Asset managers considered the most reliable source of information, followed by events
- Reliance on events as a source of information is much higher in Germany than in other countries
- Disruptive technologies are considered the most important trend affecting the investment strategy, unlike in other markets where respondents considered longevity or climate change more important
- Social media are used less often in Germany than in the other countries surveyed as more than half of the respondents do not use them for professional purposes
German institutional investors consider asset managers to be the most reliable source of information, followed by events, according to a survey by Fundamental Research. Reliance on events is much higher than in other countries as attending B2B events such as trade exhibitions or seminars is an integral part of German business culture.
Most respondents attend flagship industry events, as well as various asset manager events (e.g. quarterly ESG events). Asset managers who want to engage with this audience will need an effective advertising and communication strategy at key events alongside organising regular events themselves.
German respondents tend to associate standout communication with attributes that are usually linked to their likelihood of buying funds from a specific asset manager, such as investment strategy, process and performance as well as information on different sectors and asset classes. These are also the areas in which more than half of respondents would like to receive more information from asset managers. The quality of reporting is also an attribute strongly associated with standout communication.
In line with the other countries surveyed, respondents tend to complain about communication that is too sales focused and lacks transparency. Effective communication to win this audience over should be consistent, targeted, informative and to the point.
Focus on innovation
Between September 2019 and March 2020, Fundamental Research surveyed institutional investors in the Netherlands, the UK, Switzerland, the US, Germany and France about their views on global trends, asset manager communication, manager selection, their media consumption habits, and their top asset manager brands.
Unlike all other countries surveyed, German respondents consider disruptive technology the most important trend. New technologies and innovation are important to institutional investors in Germany, as they are also more likely to buy funds from asset managers who they perceive as innovative.
Another important topic is the ongoing low interest rate, which German institutional investors are quite pessimistic about. Similar to the other countries surveyed, this has pushed respondents to change their strategic asset allocation. Despite being traditionally risk averse, the low rate environment has prompted a quarter of German respondents to increase the risks taken in order to generate expected returns.
Other findings from our German Institutional Investor Research include:
- Sustainable investing is by far the fastest growing investment strategy in the German institutional market, as it is in all other European countries surveyed. Sustainability is also mentioned as an attribute of managers investors are most likely to buy funds from.
- The three main asset manager selection criteria are strategy/investment process, performance/track record and fees for both stages of the manager selection process (discarding unsuitable managers and picking the winner). In stage two, it is worth highlighting that performance/track record ranks higher than strategy/investment process, likely as a result of the ongoing low rate environment.
- Social media are used less often in Germany than in the other countries surveyed as more than half of the respondents do not use them for professional purposes. Career-oriented social media such as LinkedIn and Xing are the most widely used by institutional investors. Almost all respondents (93%) are using social media to read industry news and almost half f them to read content from asset managers.
Keep track of your professional development and knowledge with CPD Hub; our free-to-use platform which allows you to earn, track and report all of your CPD learning. Bank your CPD points for this article and access a wealth of other content by experts from leading financial institutions.