Hedge Fund Branding: Here's How To Elevate Yours

This article was written by Sara W. and is the opinion of the author. Hedge funds have a tainted image in recent years. As the regulatory landscape has changed, marketing, branding and public relations for hedge funds have become increasingly important. In the past, hedge funds had relied on word-of mouth communications and capital introduction platforms for promotional efforts. Today, this may prove to be a dire strategy as the new evolving culture within the investment community demands more transparency and openness. Hedge funds should consider the bigger communications picture to build confidence in their brand, image and strategy. Branding Begins with Standing for Something To start, hedge funds should think about their brands and public perception. In order to compete at the learning edge of change, hedge funds should assess the intangible aspects of their brand including culture, standards of service, ethics and the impact of compliance. Now, it goes without saying that performance and top-tier people are important, of course, but the culmination of how these factors are communicated requires significant attention. Funds should evaluate their perspective and decide what they stand for and what value they bring to investors, employees and the broader community. To Find Yourself, Define Yourself Intelligent investors invest in what they know or can understand. Now that hedge fund managers can join other financial service providers in using digital, print and social media channels to engage with potential clients, investors are looking for clear, confident and succinct messaging. Clearly defining who you are, what you do, and why you are the best at it will provide beneficial and obvious results. McKinsey estimates that there is a $1.2 trillion opportunity for business to use social media. With consistent messaging, funds can generate more demand, increase brand/name recognition, recruit high- level talent, and perhaps of most importance, assume a thought leadership position and voice of expertise. Hedge funds with a clear investment strategy, visible culture and consistent branding will establish a competitive advantage in an intensely competitive industry by merely demonstrating the qualities that qualified investors prefer. Demonstrate Compatibility with Change Quality, content marketing is critical. But the fund managers that can formulate insight and compatibility with change will stand out from the crowd. Don't be fooled into thinking that institutional investors don't engage with digital media. To assume that anyone does not appreciate the value of readily available information would be an insult. The engagement may be of an indirect nature; however, it is alert and present. In 2011, Ernst & Young concluded that social media was becoming the next battle ground and asset managers needed to adapt to the new game. Hedge funds should prioritize the development of their social media strategies or risk being left behind. For those asset managers not already actively involved, in November 2013, Ernst & Young suggested that they need to start formulating their social media strategies "in the next 6 to 18 months as a successful strategy will generate tangible benefits for any firm in the market." As rebranding initiatives emerge, hedge funds that avoid the value of branding may soon find themselves outpaced by competition. Overall, hedge funds should consider consulting with or hiring a professional that specializes in marketing for financial services firms and branding for investment companies, has knowledge and experience in the industry and in compliance so as not to initiate an SEC investigation, and has industry insight to assist with hedge fund public relations, branding and marketing requirements.