I received some interesting feedback on this article, which focused on the language that alternatives managers often use in their marketing deck to describe themselves. There are a number of additional suggestions on overused words that probably should have made the cut – thus, the article could have easily been called “Twenty Words to Eliminate…” instead of “Five Words…”.
A couple of people posed the question about what alternative language they should consider using. It’s a great question and it reminds me that I have completely violated one of my main rules when writing a blog post: “a problem without a solution is (just) a poorly stated problem” – aptly put by Albert Einstein.
The answer is that these overused words may not necessarily be different words at all, but a different message.
Fact: people can only remember a finite number of things – typically up to three or four. And…we are more likely to remember things that are peculiar (peculiar – as in it “stands out” or is “uncommon,” – not peculiar as in, “bizarre”).
When it comes to your message, how many things are you asking someone to remember? And how distinctive are these things anyway? Most overused words we use in this industry – like unique, experienced, and proprietary, are often nothing more than just ordinary rhetoric. They are used in place of a more distinct message either because the effort to establish that distinct message just wasn’t made (apathy) – or the lack of the knowledge and process (like anything else, marketing is a skillset). Either way – it’s too important to your AUM growth to just be happy with “good enough.” Ask yourself – would you really tolerate that level of effort in developing your investment strategy?
One approach you can try to help better distill your message is what we call the three reasons exercise.
We talk about this a lot with clients. The question to ask yourself is, what are three reasons why someone should care about you? Or what are three reasons that you get out of bed every morning?
It goes like this…Step one – sit down with your team and list all of the answers to the following questions:
How does your offering fit into the investor’s portfolio? Or put another way, what problem of an investor’s do you address?
If an investor can only remember 2 or 3 things about your fund, what would they be?
We are firm believers in a statement by Jeff Bezos – “Your brand is what they say about you when you are not in the room.”
Do you really think “being a unique long/short fund with a bunch of experience that has delivered top-quartile returns for the past five years…” or the PE equivalent – “a lower middle-market buyout firm that identifies under-marketed deals through our proprietary sourcing process…” will be considered particularly memorable for an investor that spends all day, every day analyzing your peers?
Put another way – is this really what you think “they will say about you” when you are not in the room?
How many long/short managers or lower middle-market buyout firms cannot make that claim? As discussed in the previous post – just because you may be “better” at it – doesn’t make it stand out any more if the investor hears the same words from all of the other managers.
So, the real point of this is not to replace overused words with other possibly less overused words, the point is to come up with a value proposition that is actually distinct.
Once you do that, put all of your answers on a white board or shared spreadsheet and start force-ranking until you come away with the true value proposition.
Things to keep in mind for your marketing deck:
A value proposition generally isn’t about what you do – or even how you do it. It’s generally more about who you are.
Few managers are actually ‘unique’ in the literal sense of the word. As mentioned, someone else can almost always make the same claim. If it turns out that your most important element of your value proposition is something that others can also claim – then do the process again. If you keep coming back to being particularly ‘experienced’ – then force rank the attributes or skills that you possess relative to your experience that you believe others do not possess. Keep doing this until you are able to make a statement that others cannot.
Remember – the goal is not to be able to claim ten things that you are pretty good at in your marketing deck – but one-to-three things that truly differentiate you.