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AIM High: Under the bonnet of investment trusts & how to market them · Two in Twenty

• 0:02
  SPEAKER_01: Hello and welcome to another episode of Aim High, the podcast for marketers in investment management.
• 0:10
  SPEAKER_01: This week we are working remotely, and so we're all uh on our laptops trialling out Zoom.
• 0:18
  SPEAKER_01: So do bear with us if uh if the line goes a little bit correctly here and there, or indeed you hear Ross's dog in the background.
• 0:25
  SPEAKER_01: Um, yes, we are talking to Ross Duncton, who is the head of marketing at BMO Global Asset Management, as well as Annabelle Brodie Smith, the communications director at the AIC, the Association of Investment Companies.
• 0:40
  SPEAKER_01: Uh, both have a huge amount to say and share around investment trusts.
• 0:45
  SPEAKER_01: Um, so delighted to have their expertise and to to walk through and get under the bonnet of what investment trusts offer investors.
• 0:56
  SPEAKER_01: So thank you both, Annabelle, Ross, for for joining me today to talk about and get underneath the bonnet of investment trusts.
• 1:05
  SPEAKER_01: It's um it's not necessarily a part of the market or a product that people are always that familiar with.
• 1:10
  SPEAKER_01: So I thought it was really worth us um talking about that today so marketers can get a bit more of a handle as to all the different um products that investors are buying and the features and benefits.
• 1:21
  SPEAKER_01: So without further ado, uh it would be great if you guys would each maybe introduce yourselves and maybe just give a little flavour as to why you think there's such a investment trust is such a good choice.
• 1:33
  SPEAKER_01: Might start with you, Annabelle, ladies first.
• 1:35
  SPEAKER_00: Right.
• 1:36
  SPEAKER_00: Hi, I'm Annabelle Brodie Smith.
• 1:38
  SPEAKER_00: I'm the communications director of the Association of Investment Companies.
• 1:42
  SPEAKER_00: It's really good to be talking to you today.
• 1:44
  SPEAKER_00: The reasons why I think investment companies make a great investment are they have very strong long-term performance.
• 1:52
  SPEAKER_00: And up to the end of February, uh, over 10 years, they're up 166%.
• 1:57
  SPEAKER_00: I have to say it's bound to be a bit lower than that right now with the market volatility.
• 2:02
  SPEAKER_00: Um, they have an independent board of directors who are there to look after shareholders' interests and add an additional area of scrutiny and corporate governance.
• 2:14
  SPEAKER_00: Um, they have um a unique structure, they're closed-ended, they're listed on the market, but they're closed-ended, so there's a fixed number of shares, and that means managers can take a long-term view and they are not for sellers, which can be very helpful in these sort of volatile markets.
• 2:33
  SPEAKER_00: Um, and finally, they have montages.
• 2:38
  SPEAKER_00: We have 21 investment companies that are dividend heroes.
• 2:42
  SPEAKER_00: That means they've increased their dividend every year consecutively for over 20 years.
• 2:48
  SPEAKER_00: And clearly, in this very low interest rate uh environment, investors are looking for income.
• 2:56
  SPEAKER_00: Thank you.
• 2:56
  SPEAKER_01: As a um communications director of the ASC, you've clearly well rehearsed that answer.
• 3:02
  SPEAKER_00: Um, I have said it a few times, Ross, over to you.
• 3:08
  SPEAKER_02: Good, yeah.
• 3:09
  SPEAKER_02: So um hi, my name is Ross Duncton.
• 3:11
  SPEAKER_02: I head up marketing for BEMO Global Asset Management in the Crossamir, and I also head up our direct to consumer business here in the UK.
• 3:18
  SPEAKER_02: Um, I've been at BEMO for about seven years, um, but before that I worked um not in asset management or investments actually, but in other financial services products and um also some consumer goods before that as well.
• 3:31
  SPEAKER_02: So broad range, but always marketing as a whole.
• 3:33
  SPEAKER_02: In terms of um, well, I think business investment trust is such a great investment choice.
• 3:38
  SPEAKER_02: I mean, I'll echo the points that Annabel mentioned there.
• 3:41
  SPEAKER_02: Also, I would I would sort of just reiterate that you know the transparency that that comes with investment trusts in terms of the broad oversight and things like that, I think is a really big um plus for investment trusts.
• 3:52
  SPEAKER_02: But also, I think there's a perception in the market that they're more complicated or significantly more complicated than um open-ended funds, and and I really don't think they are, I think it's just a lot of it, and I guess that's what we're going to talk about today, is around um how they're communicated and how we articulate it from a marketing perspective.
• 4:09
  SPEAKER_02: So I I think they're they're a bit of an unsung hero in terms of um, you know, they should be on par with the open-ended funds, but historically they haven't necessarily been.
• 4:19
  SPEAKER_01: Yeah, as you say, we'll definitely get into that.
• 4:21
  SPEAKER_01: Um, on that very first point, should we just explain exactly what that closed-end structure really means in practice and and sort of why that is such a crucial part of um how the investment trusts can deliver.
• 4:39
  SPEAKER_00: Annabelle, do you want to do you wanna Yeah, I'm really happy to explain that.
• 4:43
  SPEAKER_00: As I say, investment trusts are companies, just like any other company, they're listed on the stock exchange, they have a closed-ended structure.
• 4:53
  SPEAKER_00: This means there's a fixed number of shares.
• 4:56
  SPEAKER_00: Um, when you buy an open-ended fund, it increases and decreases automatically according to supply and demand.
• 5:04
  SPEAKER_00: With an investment company, there's a fixed number of shares.
• 5:07
  SPEAKER_00: So when you buy a share, you're buying a share of someone else who is selling that share.
• 5:12
  SPEAKER_00: Um, and it is very important.
• 5:15
  SPEAKER_00: Uh, for example, uh, we've seen uh recently a number of the open-ended property funds suspend.
• 5:24
  SPEAKER_00: Now, investment companies, as they're traded on the stock exchange, as long as the market is open, you can buy and sell them.
• 5:33
  SPEAKER_00: And managers can take a very long-term of their view of their portfolio.
• 5:38
  SPEAKER_00: They are not forced sellers.
• 5:40
  SPEAKER_00: If there's lots of redemptions, it doesn't matter, they don't affect their portfolio.
• 5:45
  SPEAKER_02: Um, for me is that the the ability that, you know, effectively, because it's a closed-ended, it is a it's a PLC and so right, it's its own company and it can um it can leverage.
• 5:56
  SPEAKER_02: So in the good times, hopefully, it can take advantage more advantage um of the ups.
• 6:01
  SPEAKER_02: Of course, with that comes more disadvantage of the downs if they get it wrong, um, but also the ability to to smooth income.
• 6:09
  SPEAKER_02: So the dividends that are paid out from investment trusts, I think is a really key point, particularly when people are looking for income.
• 6:15
  SPEAKER_02: And yeah, there's a lot of so Annabelle mentioned the the income heroes, I think, earlier, and you know, there's a number of them.
• 6:22
  SPEAKER_02: Um, so in our stable, I think uh F and C is probably about 48 years, they've consistently increased the dividend, and they can only really do that because of the structure in terms of that closed closed-ended nature of it, and that from a consumer point of view or an investor's point of view, just gives people confidence in terms of you know, gives them, you know, a lot of people are investing uh for retirement or whatever it might be, looking for an income, and it gives them that steady stream, no matter what's going on in the market to a degree, of course.
• 6:49
  SPEAKER_02: But um, yeah, so I th I I think that structure has a number of big benefits for consumers as well.
• 6:57
  SPEAKER_01: So when we think of the main audiences for sort of buying investment, those buying investment trusts, um uh to your point, Ross, uh uh is it normally really just your those who are seeking that sort of stable sort of income?
• 7:13
  SPEAKER_01: Um, is that your sort of primary target uh audience?
• 7:17
  SPEAKER_02: Not necessarily.
• 7:18
  SPEAKER_02: So I mean I think um we so I would break into two different audiences, right?
• 7:22
  SPEAKER_02: So you've got and it's pretty straightforward in some respects, you've got end consumer and then you've got intermediaries.
• 7:27
  SPEAKER_02: Ultimately, all of the investors are end consumer, but when when when we're marketing to um end consumers, I guess part of the reason that I in my intro I said that I this was my first time in asset management is because when I came into the industry, um people were talking about, you know, we do open-ended and we do investment trusts, and people talk about OIK's an investment trust.
• 7:48
  SPEAKER_02: And I was like, I I don't actually understand what the difference is, and I think that's telling on a lot of end consumers don't necessarily understand what the difference is either.
• 7:57
  SPEAKER_02: And if you take just an asset test of I don't know, like my mother or my sisters or whatever, if I went to them and said you need an investment trust because there we go, I don't know what you mean.
• 8:06
  SPEAKER_02: And um, the key thing for them, and we do research with Ugov, every year we do um research to like 2,000 plus people, it's you know, it's detailed.
• 8:16
  SPEAKER_02: We've got some consistent questions in there, but one of the ones that I think is relevant here is 60 or 70 percent of end consumers, they're not their first decision is not to choose an investment trust or an OIC.
• 8:26
  SPEAKER_02: Their first decision is to choose a junior ICE or an ICE or something like that.
• 8:30
  SPEAKER_02: They're choosing the wrapper.
• 8:32
  SPEAKER_02: Once they've chosen that, then they're choosing, well, what do I want in it?
• 8:35
  SPEAKER_02: And I think then they're looking at what are the benefits.
• 8:39
  SPEAKER_02: So, not what what are the features, what are the benefits, what's in it for me in terms of how's it how's it fit with me?
• 8:44
  SPEAKER_02: So with end consumers, I don't, you know, I think it's really getting across the benefits and not necessarily focused on the features.
• 8:52
  SPEAKER_02: And then with intermediaries, I think it comes back probably to some of the points that we were talking about a second ago, in terms of it's you know, they're not forced sellers when people redeem.
• 9:00
  SPEAKER_02: That's a really important point for certain asset classes at certain points in market cycles and all of those sorts of things.
• 9:06
  SPEAKER_02: Ability to smooth income, it's great benefit.
• 9:08
  SPEAKER_02: Um, the leverage point that I mentioned earlier, and sometimes for single strategies, it has other benefits in terms of you know the particular asset class.
• 9:17
  SPEAKER_02: So I think you know, in terms of the audiences, there's two very clear ones.
• 9:22
  SPEAKER_02: The way that we articulate the benefits is is is uh there's different ways of doing that depending on the audience.
• 9:30
  SPEAKER_01: Yeah.
• 9:31
  SPEAKER_01: And do you do Annabelle?
• 9:32
  SPEAKER_01: Are you presumably appealing to both audiences?
• 9:35
  SPEAKER_01: You're sort of both trying to help uh the advisors and sort of present to them both the features and the benefits, as well as, as Ross says, you know, for the end consumer, the end buyer to understand um not necessarily what the structure is, but at least what the benefits are.
• 9:54
  SPEAKER_00: Yeah, absolutely.
• 9:55
  SPEAKER_00: We are doing that.
• 9:58
  SPEAKER_00: We are um looking at private investors, and you know, obviously they vary from you know, more retired people who are looking for an income to people who are saving for the long term, saving for retirement in an eye, you know, in a SIP, in an ISA, and a lot of a lot of actually people saving for their children as well.
• 10:17
  SPEAKER_00: Saving for children has been a real success for the investment industry.
• 10:22
  SPEAKER_00: They are a very good vehicle for that long-term attitude to investing.
• 10:28
  SPEAKER_00: Um, and then in terms of the intermediaries, absolutely, we have a program to educate um intermediaries.
• 10:35
  SPEAKER_00: So we have educated over 7,000 advisors since we've seen that program.
• 10:42
  SPEAKER_00: Um, and also the younger wealth managers, too.
• 10:45
  SPEAKER_00: We work with clearly that's education but and also communication.
• 10:50
  SPEAKER_00: And I think Rust is very right there.
• 10:52
  SPEAKER_00: The alternative assets, assets like property, like infrastructure, investment companies have got a lot of appeal for those intermediary audiences.
• 11:03
  SPEAKER_01: Absolutely.
• 11:04
  SPEAKER_01: So, why does it does it feel like the profile of an investment trust buyer is changing gradually?
• 11:13
  SPEAKER_01: Because to my mind, when I think of your typical investor, let's just say he is of a certain generation, you know, is it a very clear picture in my mind?
• 11:21
  SPEAKER_01: And how do we is is that changing?
• 11:24
  SPEAKER_01: Uh, do you see that changing, Annabelle?
• 11:27
  SPEAKER_00: Well, I think you're right.
• 11:30
  SPEAKER_00: Typically, you know, investors have found their way to investment trust when they're sort of 40 or 50.
• 11:35
  SPEAKER_00: That has been the case traditionally.
• 11:38
  SPEAKER_00: But I do think it is changing a bit.
• 11:40
  SPEAKER_00: If you look at those people who are saving for children, the people who are investing in ISIS, they are younger.
• 11:48
  SPEAKER_00: Um, and I think as a result, we need to bear that in mind in terms of our communication.
• 11:54
  SPEAKER_00: And I know Ross has got some data on this because I was talking to him about F and C investment trust just the other day, haven't you, Ross?
• 12:01
  SPEAKER_00: Perfect segue.
• 12:03
  SPEAKER_02: I do, if I can remember it off the top of my head.
• 12:06
  SPEAKER_02: Um, I think I think what where where we got to, so uh in terms of what I was talking about about F and C investment trust specifically, so the average age of the investor, I don't know, two or three years ago was probably 58, something like that, and that's sort of ballpark.
• 12:19
  SPEAKER_02: And one of the challenges that we've been set by the board over the last two to three years in particular was to reduce the average age of um investors overall.
• 12:30
  SPEAKER_02: And I think I I think historically there probably is a typical investment trust um persona, if you like, in terms of the clients that invest in that, I think you're probably right.
• 12:39
  SPEAKER_02: I do think it's changing, and I think the key thing that will will change it is is largely how they're marketed and how they're distributed.
• 12:47
  SPEAKER_02: I mean, that's stating the obvious to a degree, but you know, RDR back in 2012 or whatever was was um a massive step in terms of getting investment trusts more prominence in terms of listings on on um platforms and all that sort of side of things.
• 13:02
  SPEAKER_02: But also I think you know it puts them more on a level playing field.
• 13:06
  SPEAKER_02: And um from a marketing point of view, I think that we play such a key role in terms of being able to um reduce that age because it's about making them relevant, putting the language, you know, making the language simple, make articulating the benefits, all the core stuff that we mentioned a minute ago.
• 13:23
  SPEAKER_02: Um, and I think that the open-ended funds, because of the nature of how they've grown over, I don't know, the recent decades, have really had um a huge focus from a marketing point of view.
• 13:34
  SPEAKER_02: I don't think investment trusts have had the same focus, and I think that's changing.
• 13:38
  SPEAKER_01: Yeah.
• 13:39
  SPEAKER_01: And actually, just on that, um, it kind of feels like maybe investment trusts have been thrust into the limelight again, not least you know, with you know, topical issues like the holding of illiquid assets, etc., and open-ended funds.
• 13:53
  SPEAKER_01: Um, so again, I guess that points to your sort of long-term nature, closed-end structure uh that you were saying at the beginning, Annabelle.
• 14:03
  SPEAKER_00: It really does.
• 14:04
  SPEAKER_00: And actually, it's very interesting.
• 14:06
  SPEAKER_00: If you look at the percentage of um the industry that now is invested in illiquid assets, it's completely changed.
• 14:13
  SPEAKER_00: If I look, if you go back to you know 2000, about 6% of our industry was invested in liquid assets or things like that, and that was mainly private equity.
• 14:23
  SPEAKER_00: The rest was all in equities.
• 14:25
  SPEAKER_00: Now, 37% of the industry is in alternative assets, and that is property, infrastructure, specialist forms of debt, uh, those sort of assets.
• 14:38
  SPEAKER_00: And of course, because we've got that closed-ended structure that managers can take a long-term view, they are not forced sellers of the asset.
• 14:47
  SPEAKER_00: So if there's a run on property and sentiment suffers, you know, because we are listed on the stock exchange, as long as the stock exchange is open, investors can buy and sell on the stock exchange.
• 15:00
  SPEAKER_00: And again, you know, Woodford Equity Income again brought this into front of mind for a lot of investors.
• 15:07
  SPEAKER_00: You know, the closed-ended structure is ideal for unquoted companies and less liquid companies.
• 15:14
  SPEAKER_01: Yeah.
• 15:15
  SPEAKER_01: And Annabelle, as part of your role also to engage asset managers to look at setting up more closed-end structures for their strategies?
• 15:27
  SPEAKER_00: Um not really.
• 15:29
  SPEAKER_00: We actually uh represent uh companies when they actually are launched, so we don't represent potential uh new launches.
• 15:38
  SPEAKER_00: Um I mean, in terms of you know, just linking this in with marketing and the managers and how it all works, um clearly what we've been doing are members of the independent boards of directors who are there to look after shareholders' interests.
• 15:55
  SPEAKER_00: Now, they work usually with a fund management group who manages the company and perhaps also is responsible quite often for the marketing of that company.
• 16:06
  SPEAKER_00: Um, and one of the things that we've been doing is trying to get encourage more boards to bring on directors who have marketing, communication, and distribution skills because it makes complete sense for the board to have those skills on there so they can understand what the management group is saying to them and interact on these areas.
• 16:32
  SPEAKER_00: And that's some of the work we've been doing.
• 16:35
  SPEAKER_01: And why do you think it's taken a while for the kind of recognition um of that skill set to be both on the boards but also um such a focus more generally for investment trusts to raise profile?
• 16:51
  SPEAKER_00: Well, I think that is a very good question.
• 16:53
  SPEAKER_00: And I have been at the ISC for 23 years, and I would say over the 23 years it has been increasing all the time, but it has it has taken a while.
• 17:04
  SPEAKER_00: Um and I I think uh directors just did not give priority to marketing a while ago.
• 17:12
  SPEAKER_00: They sort of were of the view that if it was a good product, people would find it themselves.
• 17:17
  SPEAKER_00: And we know that's not the case.
• 17:20
  SPEAKER_00: You know, we know that's not the case.
• 17:21
  SPEAKER_00: And whenever I talk to directors, I say, you know, are you doing, is this trusting something useful?
• 17:29
  SPEAKER_00: Are you um do you have a you know, is there a demand for the strategy that trusts got?
• 17:34
  SPEAKER_00: And then are you telling people about it?
• 17:36
  SPEAKER_00: You know, that is sort of a key thing I keep saying to directors.
• 17:40
  SPEAKER_01: And I guess also um boards have looked to the marketing departments of the the fund managers that are looking after their trust.
• 17:48
  SPEAKER_01: So I guess that's you know, a lot of you know where you're engaged whilst with the different boards.
• 17:53
  SPEAKER_01: Maybe you could just for the audience to say, just explain how that kind of interaction sort of um takes place.
• 18:01
  SPEAKER_02: Yeah, so I think just quickly to add to Annabelle's point, I think part of the problem I totally agree with with all the points that you just made, but I think in addition, though, I don't think marketing departments have necessarily helped themselves because boards rightly look for accountability.
• 18:16
  SPEAKER_02: And I don't think that um marketing teams have always been as accountable as they might be to boards, or also um translating marketing talk into board talk, and it is different, it's very different in terms of you know, um, we quite often sit in boards, and um, you know, terms like PPC, you know, what does that mean?
• 18:35
  SPEAKER_02: You know, you have to you so you just subtly articulate what the differences are, um, cost per click, all of those sorts of things.
• 18:41
  SPEAKER_02: They're they're absolutely relevant to what the boards are looking for in terms of accountability, but we use you know, it's very easy to sway into marketing talk, and actually you lose the boards, they get confused, not confused in a patronizing way, but they don't understand it as much as as we do, and they're not as close to it.
• 18:57
  SPEAKER_02: So it's about translating it.
• 18:59
  SPEAKER_02: Um, think in terms of what what it entails from our perspective.
• 19:03
  SPEAKER_02: So we have 10 investment trusts at BEMO, and all of those have independent boards, so we're probably talking about 50 to 60 different directors across the board across all of those.
• 19:14
  SPEAKER_02: Um, so clearly they're very fundamental stakeholders for us, you know, they're a really important part of our business, and um, increasingly they are seeing marketing as a really important part of the service that that BMO and others, I'm sure, are offering.
• 19:28
  SPEAKER_02: Um, you know, the investment sort of side of things is obviously well-versed, they expect good performance, of course, and all of those sorts of things.
• 19:34
  SPEAKER_02: It's what else are the managers providing?
• 19:38
  SPEAKER_02: And you know, those boards will typically have uh a board meeting at least every quarter.
• 19:43
  SPEAKER_02: More often than not, we will go along to well, at the very least, we'll go along every 12 months, but for some a number of them, we go along every quarter, and we're updated, you know, we put board papers in every quarter, and you know, there's a lot of work that goes behind that, and a key part of um what we've been um we've we've done over the last um I don't know, seven or eight years is about making those board packs really accountable and building the trust with the boards that when we go in and we say we're going to do something, we're really clear as to why we're gonna do it.
• 20:11
  SPEAKER_02: We you know, we we took over those seven years, all of the boards have been exceptionally supportive, but we went right back to those basics in terms of what's the message, what's the proposition, what's the you know, all of those basics that we take for granted, I think, within marketing, it's getting the boards to agree what those are, and then constantly when when conversations might sort of steer away from those fundamentals, we'll go back, but our audience is this, and then it's okay, yeah, yeah, yeah.
• 20:38
  SPEAKER_02: You can take the boards back to those sorts of things.
• 20:40
  SPEAKER_02: So, accountability, really, really important.
• 20:43
  SPEAKER_02: It's a it's an absolute hygiene with boards.
• 20:45
  SPEAKER_02: You if you if you go into a board and you're not clearly accountable for something, it can be quite um not the not the best environment to be in, to be honest.
• 20:54
  SPEAKER_02: They're quite challenging, um, but they're challenging in a good way.
• 20:56
  SPEAKER_02: And as long as you're reasonable and you're clear and articulate and you deliver what you say you're going to do and you manage their expectations, they're all exceptionally smart people and very reasonable, I think.
• 21:06
  SPEAKER_02: So, you know, they're a really important stakeholder for us, uh, and a key part of the marketing role is how you manage that stakeholder.
• 21:12
  SPEAKER_01: So yeah.
• 21:13
  SPEAKER_01: And it sounds like you have a very integrated approach that your team is right across, as you say, you're sort of agnostic as to sort of what types of vehicles that you you're offering across the product range.
• 21:24
  SPEAKER_01: Is that typical, Annabelle?
• 21:26
  SPEAKER_01: Do you see that?
• 21:27
  SPEAKER_01: Because my experience uh has been that actually sometimes the marketing support for investment trust sits quite separately to the wider marketing team.
• 21:37
  SPEAKER_01: Um, I don't know what what do you see across the market?
• 21:39
  SPEAKER_00: I would absolutely agree with that.
• 21:41
  SPEAKER_00: I think quite often the investment trust marketing team is completely separate from the wider marketing team at the management group.
• 21:50
  SPEAKER_00: Um, and potentially as a result, you know, that that's it doesn't work so well, quite honestly.
• 21:56
  SPEAKER_00: You don't have the benefit of all that resource of that knowledge.
• 21:59
  SPEAKER_00: So A very great team.
• 22:02
  SPEAKER_00: Um, so I mean, I think it is an issue.
• 22:04
  SPEAKER_00: I mean, obviously, it very much varies from management from group to management group.
• 22:08
  SPEAKER_00: Now, some management groups you have a lot of asset trust, you know, have well-resourced um marketing teams, but we have to be realistic here.
• 22:18
  SPEAKER_00: Management groups want to grow their assets under management, and how they do that is through open-ended vehicles.
• 22:25
  SPEAKER_00: So you can often see that the open-ended side is extremely well-resourced and better resourced than the investment trust side.
• 22:34
  SPEAKER_01: So you're ahead of the game there, Ross.
• 22:37
  SPEAKER_01: Um, would you maybe could you indulge us a bit in in terms of how you celebrated and and marked the the 150-year milestone of your the F and C investment trust?
• 22:50
  SPEAKER_01: That'd be great to know more about.
• 22:52
  SPEAKER_02: Yeah, so uh back in 2018 in March, probably around this very date in uh 2018 was 150 years of F and C having started.
• 23:03
  SPEAKER_02: So back in 1868, um started, and probably about 18 months before the actual anniversary, the the board uh, I mean, in summary, they tasked us with um using the anniversary to um make sure that we uh the trust was well positioned or positioned to be as relevant for the next 150 years as it had been for the last 150 years, and to do it in an in a very innovative sort of way as well that was aligned to the actual innovation of the trust when it when it formed in 1868, it was the first, the world's first um, it's the oldest collective investment fund, not just at trusts, but before open-ended, all of those sorts of things.
• 23:44
  SPEAKER_02: So, in many ways, a whole industry has come off of um off the back of F and C.
• 23:48
  SPEAKER_02: So it's a really, really big milestone.
• 23:50
  SPEAKER_02: Um, and so we we use that you know as a great opportunity.
• 23:55
  SPEAKER_02: Uh, the board were exceptionally supportive, but again, going back to my stakeholder piece, we were managing, you know, going back into that board for an hour each time, every single board meeting, et cetera, going through it, getting the buy-in.
• 24:06
  SPEAKER_02: Um, but ultimately we took the opportunity to take a real step back.
• 24:08
  SPEAKER_02: Back back in 2017, it was still named Foreign and Colonial Investment Trust.
• 24:13
  SPEAKER_02: So, one of the first things that we did was some research to go, okay, so is the name relevant?
• 24:16
  SPEAKER_02: I mean, I think we could all probably guess, but let's have a look at that from a research point of view.
• 24:20
  SPEAKER_02: It was very, very clear that the name wasn't relevant.
• 24:23
  SPEAKER_02: The most logical, the most logical sort of solution to that was to rebrand as F and C.
• 24:27
  SPEAKER_02: So, you know, that was it was a big decision on the board's part.
• 24:31
  SPEAKER_02: It was, it was, um, but it was a very logical one, and it was it was absolutely the right one.
• 24:35
  SPEAKER_02: But ultimately, we went into the 2018, that was the celebratory year, and we really on three key areas.
• 24:43
  SPEAKER_02: One was around financial education.
• 24:44
  SPEAKER_02: So back in 1868, the purpose, as we would call it today, of the trust was to enable the the investor or the the man of moderate means to invest in the stock market as it was as it was uh sort of written in those days.
• 25:00
  SPEAKER_02: And from our point of view, well, actually, that's that's about helping everyday savers get into investments, right?
• 25:05
  SPEAKER_02: That's the that's today's sort of take on it.
• 25:07
  SPEAKER_02: And back in 1868, it was about you know, it was inventing the fund itself, the trust itself, so enabling that vehicle so that people could do it.
• 25:15
  SPEAKER_02: Well, everyone's you know, there's lots of different funds out there that people could invest in these days.
• 25:20
  SPEAKER_02: So, what does it mean today?
• 25:21
  SPEAKER_02: And really for us it was but actually it's about you've got a lot of people sat cash that aren't investing because they don't necessarily understand it.
• 25:27
  SPEAKER_02: So, how do we what's our role today in terms of helping those individuals?
• 25:30
  SPEAKER_02: It was around financial education.
• 25:32
  SPEAKER_02: So we did a lot of a lot of stuff on financial education from road shows at schools to competitions with universities, all of that good stuff, uh you know, really really, really uh interesting promotion and PR, so standard advertising course.
• 25:44
  SPEAKER_02: Um, you know, we wanted to make sure that we got got the name out there, etc.
• 25:48
  SPEAKER_02: PR was really, really important as well.
• 25:50
  SPEAKER_02: So really understanding the key messages that we wanted to get across and how could we do it through PR.
• 25:56
  SPEAKER_02: So it wasn't just standard press releases, we did full research that enabled us to, you know, have gave us basically content and authority, if you like, within the within the PR sort of um arena to go out and say this is what people want.
• 26:09
  SPEAKER_02: Except we had some really robust research on that, and then we also did um experiential uh stuff.
• 26:15
  SPEAKER_02: So one of the I guess the flagship was that was for that was our lecture that we did um in the Guild Hall in 2018.
• 26:21
  SPEAKER_02: We did the last one literally a couple of weeks ago as well.
• 26:24
  SPEAKER_02: And but what we had the sort of speakers that we had two two years ago, we had Yuvel Harari, you know, the very famous author talking about the future of mankind and all of those sorts of things.
• 26:35
  SPEAKER_02: We had Paul Niven looking at the past, and um, we had Eliza Philby, who's an millennials expert, looking at how it's relevant for today.
• 26:41
  SPEAKER_02: So it was really thought-provoking, interesting um sort of topics.
• 26:47
  SPEAKER_02: And um, yeah, ultimately, yeah, we did a lot of other stuff as well, but those were probably the key strands, and the results, you know, it was all about accountability.
• 26:56
  SPEAKER_02: So we had clear measurability, we went back to the board with on a regular basis, not necessarily around sales.
• 27:02
  SPEAKER_02: I mean, I would obviously argue that the sales went up or the inflows went up because of marketing in that year, um, but around engagement stats, you know.
• 27:10
  SPEAKER_02: Um, so how many people are engaging with with the online ban and you know, basic stuff like that.
• 27:14
  SPEAKER_02: How many people did we get to the event?
• 27:16
  SPEAKER_02: How many, what was the perception of the of the investment trust afterwards?
• 27:19
  SPEAKER_02: And you know, we had some really, really positive results um off the back of it as well.
• 27:24
  SPEAKER_01: It's brilliant, isn't it?
• 27:25
  SPEAKER_01: And I think it's just a reminder to sort of the marketers listening that all those best practice marketing techniques apply, you know, and I think sometimes, you know, as we were saying right at the beginning, investment trusts are slightly misunderstood and uh so aren't necessarily sort of given the same sort of care and attention and full marketing mix as their sort of as um as the open-ended side.
• 27:50
  SPEAKER_01: Um and do you see that changing a little bit, Annabelle?
• 27:53
  SPEAKER_01: Do you see more full marketing campaigns sort of coming into play um you know with other with other asset managers?
• 28:02
  SPEAKER_00: I I think we're beginning to see that.
• 28:05
  SPEAKER_00: I think there's still a lot of work to do, quite honestly.
• 28:07
  SPEAKER_00: Um clearly the FNC 150 campaign was actually something that we highlighted at our conference a couple of weeks ago because we wanted directors to see uh how a company can think very originally, you know, strategically, and uh run that sort of campaign.
• 28:29
  SPEAKER_00: Um, and it's something actually that the AIC also, because it was 150 years of the first investment trust.
• 28:35
  SPEAKER_00: So we actually ran our own campaign alongside that based on uh performance, strong performance, innovation within the sector, and durability because we have been through a lot.
• 28:47
  SPEAKER_00: And um, that was very successful.
• 28:50
  SPEAKER_00: We had everything from uh red velvet uh massive cakes with the 150 Lego on it, going to journalists to taking journalists to an investment seminar in Edinburgh and then our Scottish Gym.
• 29:04
  SPEAKER_00: So, you know, we had a very active year, and uh we were really impressed with engagement in terms of on a website and in terms of social media.
• 29:13
  SPEAKER_01: Brilliant.
• 29:15
  SPEAKER_01: Sounds like there's there's more to come with marketing and investment trusts.
• 29:19
  SPEAKER_01: Um, I'm just conscious of time and maybe um just wrapping up with a few thoughts, uh, I guess tips for those listening around how they kind of might improve the marketing of their trusts or just to encourage marketers to get to know the investment trust side of their business um and to get involved.
• 29:40
  SPEAKER_01: Ross, would you have any suggestions for either of those?
• 29:43
  SPEAKER_02: Yeah, I mean I've I've I've probably referenced all of these throughout, but it is, you know, my key one would be follow the basic marketing principles.
• 29:51
  SPEAKER_02: You know, who's your audience, what's the message is, what's the proposition, and just just keep going back to that and everything you're doing, just how does it link back to that and you know how's it supporting it?
• 30:02
  SPEAKER_02: I think keep on top of um how people are engaging with investments overall.
• 30:07
  SPEAKER_02: So I think investment trusts um have probably been uh a lot of the trusts have been left behind over the years in terms of how they how they engage with clients versus open-ended.
• 30:17
  SPEAKER_02: And so, you know, keep it keep on top of how investments, how people are engaging with investments overall, digital, all of those sorts of things, but also more broadly than that, how people are engaging with financial services and even a step further, how people are just engaging with businesses, I think.
• 30:30
  SPEAKER_02: Um, and then lastly, just be constantly and consistently accessible from everything from what platforms you're on, how you're talking about the product, um, the routes to market, all of those sorts of things.
• 30:42
  SPEAKER_02: Just you know, I think a lot of it is just basic stuff that you just need to be very disciplined around going back to and time again.
• 30:50
  SPEAKER_01: Yeah.
• 30:51
  SPEAKER_01: Annabelle, anything from your side?
• 30:53
  SPEAKER_00: Yeah, well, I would really, I think Russ has done a great job on that there, and I would agree with everything he's just said.
• 30:58
  SPEAKER_00: I would just say, no, make sure the trust has got a strategy.
• 31:02
  SPEAKER_00: I think why would I choose this company over all the other ones out there?
• 31:09
  SPEAKER_00: And you need to get that across to your potential investors.
• 31:14
  SPEAKER_00: So, and you can get it across, you don't have to stick to the boring old ways that we've always done things.
• 31:20
  SPEAKER_00: You can think innovatively, and you can achieve a lot actually for a fairly um you know sensible budget if you're thinking a bit more innovatively and thinking exactly about who your target audience is, as Boss said, and how you're going to reach them, and to stay open.
• 31:40
  SPEAKER_00: And I have to say, I, you know, we at the ASC have embraced technology despite uh, you know, the fact that they've got a laptop without a camera at the moment.
• 31:51
  SPEAKER_00: Social media and we're on, and we're very, very proactive on Twitter, we're on Facebook, and we're proactive, we're on LinkedIn, we are thinking about other forms of social media, whether we should be on them.
• 32:05
  SPEAKER_00: And we have a lot of engagement on those platforms.
• 32:08
  SPEAKER_00: So you do have to think outside the box.
• 32:11
  SPEAKER_01: Yeah, and I'd say also to those who just want to learn a bit more about investment trust to go to the RSE website.
• 32:17
  SPEAKER_01: There's plenty of sort of educational uh sort of content there, and also look at look at the competitor landscape, you know, go and see what others are doing and sort of see how they're competing and how they're trying to engage maybe very similar target target audiences.
• 32:32
  SPEAKER_01: Um thank you guys for sort of the whistle stop tour of uh of sort of really digging into what investment trusts offer, how they're different and how they can be marketed.
• 32:41
  SPEAKER_01: Um really, really great conversation.
• 32:44
  SPEAKER_01: And thank you for also sort of adapting to doing this remotely and and via Zoom rather than face to face.
• 32:51
  SPEAKER_01: Really appreciate your time and and uh adjusting to do that.
• 32:54
  SPEAKER_00: Thanks so much, it's been an absolute pleasure.
• 32:57
  SPEAKER_00: Thanks and take care of it.