Secret campaign targets industry funds

A major retail fund manager, owned by one of Australia’s largest banks, has launched a clandestine marketing campaign to help financial planners debunk industry funds’ advertising claims at the point of client contact.

The fund manager has been distributing the campaign in ‘closed’ sessions at semi­nars and conferences of its aligned dealer groups this year, as well as those of other non-aligned dealer groups.

Financial planners from both an insti­tution-owned and an independently-owned dealer group told Money Man­agement in confidence that they attended one of these closed sessions this year.

The planners said the campaign mes­sage was delivered via a representative of the fund manager - the name of which is known to Money Management - using a PowerPoint presentation entitled ‘Industry Fund Myths Exposed’.

They said the presentation used com­prehensive research to debunk what was described as “six very damaging myths spread by the industry funds in its cur­rent ‘Compare the Pair’ advertising campaign”.

“It accused the industry funds of clev­erly leveraging the government, the reg­ulators and media to spread these myths on their make-up and performance, with­out ever having to reveal the truth behind them.

“In particular, the industry funds were accused of spending $65 million in adver­tising — funded by the savings of their mem­bers — purely to attack the retail superan­nuation and financial planning sectors.”

The planners said the campaign con­cluded by “calling on the whole financial planning community to use its influence to correct the inaccurate perception being cre­ated by industry funds”.

“The presenter described the presenta­tion as a ‘call to action’ to spread the word, to fight back against these myths, in the media and with our clients,” they said.

One of the planners also said he under­stood the campaign had been launched by the fund manager only after sustained pres­sure from within its aligned dealer groups to counter the industry fund advertising claims.

He said there were demands for the fund manager to sponsor a national advertising campaign to counter the industry funds’ claims but it refused to do so for fear of losing substantial wholesale mandates from the industry funds.

In the end, as a compromise, the fund manager launched the clandestine market­ing campaign as a way of trying to exert pressure on the industry funds while remaining anonymous, he said.