Super funds need a member engagement makeover

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For superannuation funds, members are their reason for being. Attracting new members and retaining existing ones is critical to their survival, especially in this world of continual change. The top priority on all superannuation funds’ lists is improving member engagement. But what does this mean and where do funds start?

Let’s begin by looking at the ways funds have traditionally engaged with their members and the challenges associated with these methods.

Correspondence filed away, web sites ignored

Legally, superannuation funds are required to inform their members of their balances and changes to the fund at certain times in writing. So members receive annual statements and other occasional correspondence from their funds.

However, disengaged members are likely to not even read their annual statements. Instead, they simply file them away until they are about to retire and want access to this money.

Over recent years, we have seen funds begin using their websites to correspond with members in a faster manner than by mail. But if a member is not engaged, why would they be looking at this website? Conversely, if a member actually does visit the fund’s website, how often is it refreshed with the type of information the member is looking for?

Lost call centre opportunity

For years, many superannuation funds have been outsourcing their call centre functions. Although funds have monitoring processes in place to listen to what their members are being told, this is usually done merely from a compliance perspective rather than from an engagement point of view.

When a member calls the fund to rollover their money to another fund for example, the call centre operator is obliged to follow member instructions in order to satisfy the member and all compliance obligations. While this results in a ‘pleasant transaction’ – the member gets what they wanted and the call centre meets its service level standards – the fund loses a member. In most cases, even if funds train call centre staff to use prescribed wording to encourage members to stay, by the time a member gets to this stage it is usually too late to change their mind.

Inadequate member surveys

Member surveys have been used by the superannuation industry for years. If the majority of survey respondents are satisfied and the fund’s targets have been met that is an excellent result, right? Wrong! Have the funds looked more closely at the members that are not satisfied or the members that have not responded at all, to understand the causes of dissatisfaction non-response and try to address the underlying issues?

Enquiries and complaints

Legally an enquiries and complaints mechanism is required for all Australian superannuation funds. As long as funds respond to any issues raised within the required timeframe, this is viewed as an excellent result. But what do funds do with the knowledge they have gained from these enquiries and complaints? How can they use the information to help them understand what members do or don’t want from the fund?

It’s clear the existing communication channels and frameworks need to be revisited if superannuation funds want to increase member engagement and retention levels. So now let’s examine some of the key areas that funds should consider as part of their overall member engagement strategies.

End outsourcing

In many cases, call centres remain a member’s main touch point with their superannuation fund. Having control of this channel is vital. Funds need to take back ownership of their members, not leave this important role in the hands of an outsourced service provider. 

Digital innovation

Funds have digital ambitions. There is no doubt that innovation in digital technology has transformed the world and is dramatically altering customer experiences across all sectors of the economy. Australians are enthusiastic adopters of digital and mobile technologies, so funds need to get on board this trend, and fast. However, this is easier said than done and, for funds to ride this wave of change, there are a number of factors they need to consider.

Firstly, there is the issue of technology investment. Funds need to look at whether their current infrastructure supports their digital ambitions. How easy will it be to design or develop the required infrastructure? For some it may be easier than others. Important areas to consider during the planning stage include the use of outsourced service providers, the cost to design and implement, and allowing flexibility for future changes. In the digital space, what is relevant today may not be tomorrow.

The second area that needs focus is organisational structure. Will the fund’s current organisational structure support its digital ambitions? Does the fund have people with the right skills to design, deliver and promote their digital strategy?

Make better use of social media and web sites

Social media is a relatively inexpensive marketing and customer communication tool. It’s an influential medium, particularly for digital savvy younger consumers. While some funds have started to incorporate social media elements into their member engagement toolkit, success to date has been minimal. The question that funds need to ask themselves is whether they have developed a robust social media strategy based on specific, measurable goals.

Having an engaging online presence is not about putting hard copy documents on your website. It’s about giving members meaningful information and allowing them to interact with it.

Funds need to make their websites more engaging. If members are leaving their superannuation management in the fund’s hands, it’s because they don’t want to think about it. They want funds to make the hard decisions and deliver the information they need to know – in simple terms. So funds need to consider not just whether their website has the content members want, but also how easy it is to access and use. Can customers complete forms and get questions to their answers directly from the website?

How can funds make their websites interactive and fun, so members want to go back for more? Photos and videos attract a more engaged online user. And what about gaming? The rise of smartphones means online games and apps are becoming increasingly popular and mainstream, not just the domain of Gen Y and the digital generation.

Building trust is the key

While improving channels and methods of customer engagement is important, doing so is meaningless unless one very important thing is achieved: trust.

The global financial crisis meant many members lost faith in the superannuation system. The talk of negative double digit returns was something members were not used to and, as a result, the rise of an ‘I can do better than you’ mentality has seen an increasing number of members switching to SMSFs.

People are increasingly looking to alternative channels, such as advice from friends and their family accountant, for financial decision-making, because these are channels they trust.

In this environment, implementing new means for members to keep in touch with their funds will not make a difference unless funds are prepared to analyse the results and learn from these, in order to build a trusted relationship.

Funds are already engaging with their members via emails, enquiries, complaints, and website visits. Developing a strategy to better analyse the information available through these interactions – and being willing to act on the findings – may be the starting point funds need when it comes to increasing member engagement.

Maree Pallisco is the national superannuation leader for Ernst & Young Australia.

The views expressed in this article are the views of the author, not Ernst & Young. The article provides general information, does not constitute advice and should not be relied on as such. Professional advice should be sought prior to any action being taken in reliance on any of the information. Liability limited by a scheme approved under Professional Standards Legislation.

 

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One Response to Super funds need a member engagement makeover

  1. PJ December 13, 2013 at 2:55 PM #

    I think the first issue is, what does member engagement mean? It seems to be used as a catch all phrase and a motherhood phrase for all sorts of solutions about member issues. Is member engagement increasing: brand awareness; the prevention of losing members; encouraging members to interact more with the fund and their investment; or member education. And if any of those in particular (or all), what are the outcomes and will they be beneficial.

    You could argue that encouraging member engagement in the form of member interaction with their investment could have negative externalities. Surveys show that people over estimate their financial ability/literacy, and member engagement to encourage take up control of investments could lead to negative investment outcomes as members make sub-optimal decisions.

    Funds are losing members to SMSF space, member engagement via social media doesn’t change that. They’re leaving primarily to control their assets, not because their fund doesn’t tweet to them enough. Or they die (nothing can help that!) or they retire and take a lump sum.

    While social media is an influential medium for consumers, I think it’s a little disingenuous to liken super fund members to consumers. They’re very different beasts.

    That being said, I think member engagement is important, and social media strategies are important; but we cannot sit here and use catch all phrases and talk about the benefits of social media, without being able to articulate what they mean, and what the desired outcomes are.

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