Creating engaging pension communications with impact

We know that pensions are a very complex subject. Many people don't have the confidence to simply dive in and ‘figure it out’. There’s a serious lack of confidence among large groups of members – and that lack of confidence can easily lead to the dreaded inertia before you know it. Which is why your approach to communicating the ins and outs of your scheme to those who need a little help is so important.

When it comes to delivering pension communications that make an impact, it’s all about understanding your audience and having the right strategy in place; it’s about looking at how you can segment that audience then developing appropriate communication solutions that will resonate with them, solutions that will meet them where they are on their own personal journey.

Yes, we know there’s always auto-enrolment for the disengaged to fall back on (and, let’s face it, inertia can actually work well in that space to a point), but getting people used to the fact that they don't have to make their own decisions only puts them in a situation where they're actually preventing themselves from having choices in the future; where the level of investment, outcome and value that they're getting from their pension arrangement is going to be so low that they won't really have any choice when it comes to what they can actually do with the benefits.

Which is why, however far into that journey they are, people need help to really gain confidence when it comes to figuring out exactly what they need to do.

Strategic approach

Taking a strategic approach to communications will enable you to target the outcomes you want members to achieve, rather than just the sort of creative outputs or communications solutions that you may put in place to communicate with them.

This is all about creating communications that help you drive better outcomes and better decision making – and with recent Scottish Widows research reporting that 39% of the population in the UK are still not saving adequately for retirement, there’s no better time to get started.

There really is a big job to be done in this space, and focusing on value is a good place to start – more specifically focusing on a value that enables you to demonstrate that all-important return on investment (ROI).

To do this, it’s important to think carefully about measurement. Because the benefits of having a communication strategy with measurable objectives that will really help you prove that ROI are huge. Why? Because today’s members are essentially consumers; and, as consumers, they expect a level of experience that’s similar to what they see in their everyday lives with the likes of Amazon or Netflix – or any of the multiple brands that they choose to interact with every day.

Experiential gap

We know from our annual State of the Sector report that there is a huge gap between what people experience outside of work and the digital experience they get inside work. As trustees and pension managers, it's critical to compete with these external influencers in a likewise a manner – and to get this right there has to be a two-way flow of information.

Which is why we simply can’t treat all members the same any more. People are all different. We all have different needs, different attitudes, and different consumer preferences, different ways of receiving, understanding and retaining information. And when you throw in a clear focus on diversity and inclusion, it’s important to demonstrate just how much more effective you can be by targeting specifically at certain either demographics or, or different segments of your audience.

How do you approach this? One word: digital.

Digital offers huge opportunities when it comes to creating bespoke, personalised experiences, something that we think will soon become industry standard – certainly within the next five to 10 years.

What we’re essentially talking about here is the ‘why’, ‘what’ and ‘how’ of good communication and personalised experiences – and that all starts with our attitude towards segmentation.

Time to segment

It's true that the pensions industry has been dipping its toe in the waters of audience segmentation for many years; lots of schemes have looked at this in terms of audience or member type – typically, thinking about the active audience, deferred members and pensioners. But, with the level of data that’s readily available in the industry, there is so much more rich information to acquire in terms of segmentation. In fact, some of the best work that’s being done right now has a real depth of data analysis that sits behind it and informs the segments.

The question here is where to start – and our advice is to keep it simple. For example, it’s an obvious thing to say that you wouldn't talk to a young audience just starting out on their journey in their career with the same messages that you would for somebody who is approaching retirement – of course, you would do it differently. But just using segmentation that's based on age is like saying that every 14 year old thinks the same and every 25 year old thinks the same; and that's just not a sensible approach to take.

The key word here is ‘attitude’. If we can use what we know about member attitudes to money, then target specific messages to them, we can start to drive specific behaviour – and it's the data that will help us get this right.

For example, if we think about members who are at the default contribution rate in the default investment funds at the default retirement age, it's fairly clear to see that those people are not really engaging with their pension arrangement – and that’s why giving them a nudge to pay more contributions is going to have the single biggest effect on their outcome at retirement, particularly in a defined contribution environment.

Looking at your members and targeting them is a good way to approach that. Looking at how they're interacting, so if people are registered for their online, pensions accounts or not, it may well be that you segment the people that are not and try to drive them to sign up for the online accounts, so that they can interact – and, indeed, you can interact with them in a more digital way as well.