Asset management firms are increasing their sales and marketing budgets for the defined contribution investment only marketplace by 28% this year, according to a report from
Much of the spending is being used to hire salespeople and to launch marketing campaigns aimed at financial advisers that focus on DC Business, Sway found, through a survey of 14 asset management firms.
Some of the increase in spending is in response to mounting competition from other asset managers, as well as increased flows in to proprietary target-date portfolios, all of which are placing greater pressure on DCIO executives to meet aggressive sales goals, said Chris J. Brown, principal of Sway Research.
But like many other companies that are tightening their budgets and holding onto cash in this market, asset management firms do not plan to continue investing in DCIO promotions in 2009. Unfortunately, the slowing U.S. economy and falling stock prices are likely to impact DCIO spending in 2009, forcing some DCIO business leaders to do as much, or more, with fewer resources, Brown said.
