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Cogent Reports: DC Advisor Brand Consideration Begins with Trust

New Study: American Funds, Fidelity, Vanguard and BlackRock Are the Most Trusted DC Investment Managers

Above all else, “trustworthiness” is a must-have ingredient for brand consideration in the defined contribution (DC) industry, outranking more concrete factors as consistency of investment performance and the experience of the investment team. In fact, DC investment managers that fail to foster trust among DC producers have little chance of being considered for new business. These and other findings are included in the annual Retirement Plan Advisor Trends™, a Cogent Reports™ study by Market Strategies International.

“The power of brand trust and its resounding impact on brand consideration cannot be underscored enough—brand trust is vital for gaining traction among DC advisors as well as DC plan participants and affluent investors,” said Sonia Sharigian, senior product manager at Market Strategies and author of the report. “This is one of the most consistent and hard-hitting trends we’ve seen across a multitude of our studies. Any asset manager that is striving for growth or seeking to maintain its standing needs to pay attention to this metric.”

The study further details the DC investment managers that embody the concept of trustworthiness. Over three in 10 DC producers consider American Funds, Fidelity, Vanguard and BlackRock “a company I trust.” In addition, these four firms continue to top the leaderboard across other key drivers of consideration.

“In an industry that appears to be plagued by lawsuits and negative media coverage, DC investment managers are facing a significant trust deficit. As such, understanding current perceptions and monitoring the experience factors that build trust are imperative to the health of a brand’s DC business,” added Linda York, senior vice president at Market Strategies. “Once trust has been established, managers can pivot to other leading consideration drivers such as value for the money, the experience of the investment team, company investment philosophy and global product offerings.”

Top Five DC Investment Managers Associated with “Is a company I trust”

 Rank  Established DC advisors 
 1  American Funds
 2  Fidelity Investments
 3  Vanguard
 4  BlackRock
 5  Franklin Templeton Investments
Source: Market Strategies International. Cogent Reports™. Retirement Plan Advisor Trends™: October 2016.

About Retirement Plan Advisor Trends

Cogent Reports conducted an online survey of a representative cross section of 508 plan advisors in August 2016. Survey participants are required to be actively managing DC plans. In determining the sampling frame for this study, Cogent Reports ensures data are representative of the DC advisor population as determined by Cogent Beat™ Advisor. Strict quotas are set during the data collection period, and post-fielding statistical weighting (where necessary) is applied. The data have a margin of error of ±4.35% at the 95% confidence level. Market Strategies will supply the exact wording of any survey questions upon request.

For more findings from the report, register for our upcoming webinar, Unlocking DC Growth Opportunities in an Evolving Regulatory Era

 
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