Every pension provider, big or small, should be on a mission to share the benefits of saving for retirement. One of the biggest hurdles we have to overcome as an industry is making what we do tangible for everyday people.
At Smart Pension, we build communications to meet our members’ needs, rather than what we think they need. Over the last 12 months, we’ve been running a number of different communication trials with members to better understand their behaviour and what’s important to them.
Here’s what we’ve learnt from our most recent Midlife Pension MOT communication trial
When it comes to money and spending habits, reality checks are important as they let us know if we are spending too much, need to pay more or aren’t saving enough. Pension saving should be no different from other industries, or other sectors of the financial services marketplace. As an industry, I think we sometimes avoid telling the ugly truth of how much money you’ll need to live the lifestyle you’d like to have at retirement.
In our Midlife Pension MOT trial, we did focus on just that – we gave members a self-assessment to better understand where they were today and how much they may need in the future. In this self-assessment, we provided them with the PLSA’s Retirement Living Standards. These standards show members what life in retirement looks like at three different levels, and what a range of common goods and services would cost for each level.
These independent benchmarks are so important as they compare familiar everyday items with what they could cost when the member comes to retirement. This comparison is essential if we want to connect with members, and do so in a way they can understand and that can prompt them to take action.
This reality check approach has been really successful at Smart Pension, with average email open rates of over 55% and click-throughs of over 7.5%, both far higher than industry averages.
We gave members information that was relevant to them, personalised to their circumstances and made it easier for them to take action. It included their age, current pension value and their selected retirement date.
This gave them an overview of their current pension savings, all in one place, and made it easier for them to make an informed decision, without having to search for more information somewhere else.
We all know that saving for a pension isn’t as exciting as saving for a holiday. That’s why we needed to communicate in a way that is tailored and exciting for members. One of the most successful ways to do this is by using animations to tell a story.
For example, for our midlife Pension MOT campaign, we visualised this by comparing it to a car travelling for its yearly pension MOT.
Check out our pension MOT animation below
I sometimes compare this to a supermarket analogy. If you head to a supermarket for one item, you very rarely come out with just that one thing. That’s because you are given lots of choices in a short amount of time. This prompts you to consider other things and other products before going to pay for your item or items – if you fall into the trap.
This experience is not too dissimilar to how we read communications. The more the communication tells you, the more distracted you can become. If an email points to more than one call to action or drifts away from a single message, that reduces its effectiveness considerably.
We tested more than one call to action in our emails, and we noticed a considerable drop in their conversion rate.
While, as an industry, we have made good progress, there is still a long way to go. We still over-rely on PDF files to contain all the information the member would ever need, rather than focusing instead on delivering bite-size but actionable content.
However, by sharing ideas like our Pension MOT, I hope we can encourage other providers in the industry to share their own insights and learnings. Together, we are a greater force to make a meaningful difference and improve outcomes for all of our members. The good news is that we’re already making progress – the new simplified annual pension statement (which Smart Pension has already adopted in 2019) is a good example of collaboration between pension providers, alongside the new National Pension Tracing day initiative.
Let’s make sure that in 2022 we make even greater progress and help reach as many members as possible with meaningful and actionable communications, for everyone’s benefit.
If you would like to find out more about the campaigns we run, and how we run them, please contact firstname.lastname@example.org.
Launched in 2015, Smart Pension exceeds £4bn in assets under management (AUM) and now serves over one million members and more than 70,000 employers. It is powered by Keystone, Smart’s global savings and investments technology platform.
Aquiline Capital Partners, Barclays, Chrysalis Investments, DWS Group, Fidelity International Strategic Ventures, J.P. Morgan, Legal & General Investment Management, Link Group and Natixis Investment Managers are all investors in Smart Pension.