Few DC Investment Managers Positioned For Growth

Few defined contribution investment managers are effectively positioned to grow market share, according to Cogent Research.

Only four firms have been able to achieve the combination of high awareness and high favorable impression among plan sponsors, Cogent found in its survey of 1,600 DC plan sponsors across all plan sizes and industries.

“It’s not enough for a DC investment manager to have high brand awareness,” says Christy White, Cogent Principal. “The essential ingredients are for a brand to be both well-known and well-liked.” 

The four brands that were rated highest in both awareness and favorable impression were Vanguard, Fidelity Investments, American Funds, and T. Rowe Price. Vanguard pulled ahead of the group of 36 leading DC investment managers to score the highest in overall favorability. Fidelity was rated first in overall awareness. 

While dozens of firms struggle with both low awareness and low favorable impression, a handful of DC investment managers, including BlackRock, PIMCO, Wells Fargo, ING, and Oppenheimer, are poised to make a move to grab market share by increasing awareness of their offerings and capabilities, Cogent concluded. “These firms have already succeeded in creating a favorable impression of their brand,” explains Linda York, Research Director at Cogent Research. “What they need to do is move beyond being well-liked by a few to become more well-known among a broader audience of DC plan sponsors.” 

White added, “The good news is that none of the major players find themselves in the position of being well-known and disliked. The bad news is that the vast majority are struggling just to be known to plan sponsors, nevermind to have effectively differentiated themselves from the large pool of managers vying for a spot on the investment line-up.” 

Click here to view full survey results.