Australia’s superannuation funds have nearly the highest proportion of internal asset management in the world, but there’s plenty of questions hanging over the practice even as funds push into more expensive niche asset classes.
The retirement chief of the $335 billion AustralianSuper, who was “instrumental” in delivering a slew of member experience uplifts across a 17-year stint with the fund, will leave this month to establish a new venture.
How funds need to engage in future – EY
Last year’s early release scheme for super fund members was a major event for both members and their funds, according to a report by advisory firm EY. For many funds it was an opportunity, too, which was largely missed.
The EY report and short video, ‘Rethinking Member Engagement’, says: “As a result of the Government’s Your Super Your Future reforms and the findings of the Retirement Income Review, the fund/member relationship is changing and the industry needs to rethink how it will engage with members in the future. Now is the time for superannuation funds to step into the breach.”
With the industry facing a possible ban on advertising, or at least regulatory curbs on its usage, funds need to consider what they can do to differentiate themselves, retain and attract members, EY says.
Maree Pallisco, EY national superannuation leader, said: “We need Australians to become more informed about and involved with their retirement savings, and super funds should be leading this conversation.
“With the Your Super Your Future reforms on the way, it will be easier for consumers to compare funds and choose who manages their super and retirement savings.
“So, if they want to differentiate themselves in the market, 2021 needs to be the year super funds really step up and join the public conversation, get to know their members better and rethink their engagement strategies.”
The three main components of the EY engagement advice for super funds are:
- Listen. Rather than relying solely on feedback from call centres and complaints channels, funds can get a more accurate idea of member sentiment, pain points and needs using a low-cost brand tracker to trawl through social media, blogs and niche web forums.
“It’s worth bearing in mind, social media is just the canary in the coal mine. If 100 people on Twitter are moaning about your clunky web site, another 35,000 are probably thinking the same thing,” Pallisco says.
- Be available. Funds need to “pop up” when their members ask Google super-related questions. The fact that they don’t is a “big deal”. It creates the erroneous impression members cannot go to their funds with such questions.
Pallisco says the answer may be to transition from an organisation that looks after your money to one which supports your financial wellbeing. “That means showing up in the moments that matter – both good (first job, marriage, kids) and bad (redundancy, bankruptcy),” she says.
“This is not about offering financial advice, but rather ensuring members understand how super works and what their options relating to it are in key life moments.”
- Be trusted. Super funds – at least those not owned by banks – have the advantage of not being owed money by members. An estimated 80 per cent of people in financial difficulties are not comfortable asking for help. Funds can position themselves as non-judgemental trusted advisers.
While the word was widely used, perhaps overused, during 2020, EY suggests “2021 should be the year of the pivot”. That is, the year funds join the public conversation, get to know their members and decide how best to support them.
