Despite the hundreds of thousands of dollars being spent by the superannuation industry on advertising, new research by CoreData has found super fund brand strength is not correlated to membership growth.
There is an apparent disconnect between brand growth and appeal, with the fastest-growing funds not necessarily garnering higher brand scores. To some extent this is a product of very similar growth rates among established funds, with few funds growing significantly faster than the rest.
The top brand perception ratings are clustered tightly enough together to suggest that the industry as a whole (and particularly the industry fund sector) suffers from a lack of brand distinctiveness.
CoreData’s Super Fund Brand Research 2014 asked more than 2,500 Australians to rate the top 24 superannuation funds (by members) on six key brand attributes that aimed to measure the brand strength and appeal of Australia’s largest funds.
Respondents were asked to rate their own superannuation fund (‘internal raters’), as well as funds with which they are well acquainted (‘external raters’).
Additionally, there is very low correlation between 5-year returns and brand perceptions, potentially due to the general lack of awareness about super fund returns. Super fund members are also more focused on fees than returns, possibly due to the fact that they have a more comprehendible impact on super fund balances.
Cross-selling not working for Big Four
While the Big Four banks would appear to have an advantage in terms of the ability to convert bank customers into super fund customers, the research suggests this strategy is not being utilised as effectively as it could be.
ANZ has the highest proportion of banking customers who are also members of Smart Choice or OnePath (13.8%), while CBA has 10.9% who are members of either CBA Essential Super or Colonial First State, and NAB and Westpac both have 9.6% (who are members of MLC and BT Super for Life respectively).
The emerging power of utility
The most critical choice drivers for consumers are trustworthiness, stability, fees and investment performance. Although most funds (particularly industry funds) traditionally perform well in these aspects, there is clearly a glut in this positioning.
Utility is emerging as an effective tool for the fastest growing brands to establish a distinctive brand identity that appeals to the increasing number of engaged and discerning super consumers who are making an active choice with regards to their super.
Having a utility-based customer value proposition (CVP) is particularly important for retail super funds, who are competing for those members making an active choice, since the industry funds are capturing a large number of passive members through default super funds.
Virtually all funds have low brand equity
Respondents were asked to rate the unique CVPs of the 24 funds included in the research, with some people shown the branded CVPs, and others shown unbranded.
All funds were found to have negative brand equity – that is, the scores were lower for the branded CVPs than the unbranded CVPs – indicating that there is little effective brand equity to engender more appeal or authenticity around a CVP. The most appealing CVPs tend to carry a relatively simple message that focuses on competitive returns, low fees, and emotive appeal.
Women want emotional appeal, men interested in value
The research has also found that when it comes to targeting members an emotional brand message (that focuses on things like trust, recommendations and social responsibility) is more appealing to female respondents than males, and tends to be more strongly prioritised for respondents with lower investment knowledge.
In contrast, brand messaging that focuses on value, such as competitive investment performance, fees/charges and value for money, has greater appeal among male respondents.
