An interesting excerpt from today’s InvestorDaily quoting Tria Investment Partners Managing Partner Andrew Baker on the difficulties some active equity managers are having in the current market.
Baker states; "Historically, there has been a strong correlation between index performance and net inflows, but since 2009, this has broken down," He believes the outflows are partly caused by a lack of investment in product development and marketing by asset managers. Baker adds, "Let's be honest - in many asset management firms, the level of investment in marketing would be seen as a joke by a major FMCG firm. We are seeing the consequences of that lack of investment."
The cross-industry comparison may be slightly unfair but there is a definite difference in mindsets between the two. FMCG companies see marketing as an investment to drive growth in their organisations. Until asset managers view marketing in this way nothing much is likely to change.