The regulator doesn’t see things in the same way and the problems of pensions liberation, pot follows member and the adoption of auto-enrolment make engagement absolutely essential. However, the real game changer was the radical reform introduced by the Chancellor in the March 2014 budget.
As a result of the Chancellor’s surprise announcement, pension schemes will no longer be able to rely on simplistic forms of communication at specific times of a member’s life. But engagement is a priority and finding a way to communicate that promotes engagement is a challenge.
The last 20 years has seen technology transform the way we communicate. Personal computers gave way to the internet, which has been revolutionised by faster broadband speeds. We now watch TV, consume goods and interact with friends, family and organisations differently, thanks to the development of smart devices such as smartphones and tablets.
Smartphones have changed our world. A 2013 survey by Deloitte showed that 75% of UK citizens have a smartphone, while tablet ownership sits at roughly 60%. And if you own one hand-held device, you’re likely to have more of them, with 49% of households reported to have six or more smartphones, tablets or PCs.
Video is growing and a number of consumers are choosing online video content over TV, which means organisations must have engaging content in this area. If they have the right content, consumers will engage with it regardless of whether it is a pension scheme or a desirable consumer good.
This is an important lesson for those in the pensions industry to heed. Member engagement is expensive and often reaps little by way of reward. The industry must find a way to attract the increasingly discerning, connected individual.
If you consider the number of smartphone users in the UK, and the fact that 25% of these consumers are only accessing the internet via mobile devices, it makes sense to invest more in this area, as it is likely to yield the highest level of engagement.
Out with the old, in with the new
The trouble with pensions is processes are siloed. That includes communication, preventing true interaction and interconnectivity.
Each individual absorbs information in a different way. Having information available in different forms – textual, graphical, audio or video – offers a member the opportunity to choose their preferred medium. But the industry needs to do more.
The pensions industry offers multiple formats, but then also offers – and encourages – employees and scheme members to access the information via multiple devices. If you consider the number of smartphone users in the UK, and the fact that 25% of these consumers are only accessing the internet via mobile devices, it makes sense to invest more in this area, as it is likely to yield the highest level of engagement.
An audience of one
User-generated content is very powerful across social media and can greatly assist schemes in engaging with members.
On a more fundamental basis, using big data – a technique favoured by large retailers and being adopted in banking – will help in increasing engagement.
Big data delivers an aggregated impression of the behaviour of a specific group, in this case, scheme members. Each client or member is an individual, so the macro shifts in behaviour influenced by key life events, benefit statements or even government policy can be observed and that analysis used to predict future behaviour.
This also allows the scheme to create content the member can interact with and make it available to them before they even realise they want it.
Adopting this approach is likely to generate much better results. Instead of delivering an advertising campaign during a major TV event aimed at the maximum number of consumers, you deliver a personalised message to the member’s smart device. They are far more likely to engage with something that is targeted at them directly rather than the mass market.
This is a very powerful means of delivery and why senior execs at NatWest have said their largest branch is no longer bricks and mortar, but the one accessed by smartphones via their banking app.
Cloud-based software solutions allow businesses to develop and deliver native apps in the timely and cost-efficient manner the client–server paradigm could only dream of. The pensions industry is going to have to embrace this branch of technology if it is going to boost engagement.
As with business, schemes that exploit the opportunities of new technology will be better placed to satisfy members’ demands, and also the ever-increasing requirements of the regulator.
Equiniti has written a paper on member engagement, available to download below.
For more information or to request a copy on publication, please contact firstname.lastname@example.org