Do Car Manufacturers Use the Owner’s Manual to Attract Buyers?
Any marketer knows that you first need to engage your audience before you try to sell them something. Why then does the private equity space lead with data-heavy materials? Are institutional investors less busy than anyone else? Are they impervious to marketing? (A rumour persists that institutional investors are consumers just like you and I.) And we all know that HNW individuals never succumb to emotional decisions.
In their haste to present all the data that supports why their fund is better than all of the other funds, managers overlook one very important point: you first need to attract an audience before you try to convince it of something.
The majority of marketing material created around alternative investments not designed to engage a prospective investor. This is a huge mistake, especially with everything that is going on with the JOBS Act. Managers need to change how they think about marketing. They have to insert an entirely new step into the marketing process, a step we call the engagement process. A 40 page marketing deck certainly may be required to get someone to allocate capital your way, however, it certainly isn’t designed to get someone’s head to turn your way.
In a capital raise most people quickly get to the point where they would like to talk to new prospects. If a capital raise takes 12 – 18 months, this usually happens in about week 3. How then do you create engaging materials? There are a few rules:
1.) Pare down the amount of information you present. (If you give someone all the information, why the hell is he or she going to call you back?)
2.) The medium is the message. The professionalism and sophistication of how you present the information is hugely important. (Hire a professional services firm to create a 3 or 4 page brochure.)
3.) Use video. The spoken word is always way more convincing than the written word.
By Kyle Dunn