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More than 90 million Americans own shares of stock either as individual investments or through mutual funds, according to the New York Stock Exchange. And many more Americans participate in the stock market through retirement funds, insurance companies and other investment vehicles.
But many marketers, no doubt, want to reach only a fraction of that population—specifically, high-net-worth individuals who self-direct their investment decisions. This demographic generally has enough discretionary income to buy luxury goods and high-end services and to donate to worthy causes.
“When you run a profile of, say, borrowers vs. individual investors, you find that investors tend to be well-heeled, and they don’t live paycheck to paycheck,” says Sean Hagerty, head of marketing for Vanguard, a Valley Forge, Pa.-based mutual fund company.
Indeed, the American Association of Individual Investors (AAII) reports that its members’ average annual income is $118,792, and their average investment portfolio is $810,000. Registered members of Morningstar, an investment research company that caters to individual investors, report an average annual household income of $110,000 and an investment portfolio of almost $500,000. And 12 percent of subscribers to InvestorsInsight Publishing publications report a net worth in excess of $1 million.
Lists of individual investors tend to include more men than women. For example, 93 percent of AAII members, 79 percent of Fortune subscribers, 74 percent of Morningstar’s registered members and 71 percent of subscribers to the weekly newsletter The Kiplinger Letter are men.
It’s also a highly educated market: 61 percent of investors who subscribe to InvestorsInsight Publishing publications are college-educated, as are 87 percent of Fortune readers. And 45 percent of Morningstar’s registered members have graduate degrees.
Investors also skew older, “because age and wealth tend to be correlated,” says Hagerty. The median age of readers of Kiplinger’s Personal Finance, for example, is 51.
Other characteristics of this market: Do-it-yourself investors have sophisticated tastes. And because they often do a good deal of research before making purchase decisions, they tend to be influencers among family and friends, says Maureen Dahlen, director of product management for Morningstar. “Other people often go to our clients for advice and recommendations. So Morningstar members are respected within their social networks.”
Buy, Read, Donate
As expected, individual investors buy luxury goods, such as high-end electronics, cigars, wine, watches, jewelry, cars and travel packages, says Jay Schwedelson, corporate vice president of Worldata, a list services company that manages the subscriber files of Morningstar, Forbes’ newsletters, Value Line and other publishers covering the investment market. Usage on these lists also includes financial services and credit card companies, he notes.
Investors also are good prospects for publications, seminars and educational materials related to investing, says Jeff Sutton, president of MSI List Marketing, which manages the AAII list. Usage on that file includes, for example, Dow Jones, The Wall Street Journal and The Economist.
Marianne DiLoreto, client marketing manager at American List Counsel, a list services firm that manages the Kiplinger subscriber files, adds that usage on the Kiplinger files include fundraisers such as the American Cancer Society and the American Heart Association, as well as catalogers such as Harry & David and Wine Country Gift Baskets.
Stake Your Claim
“Kiplinger subscribers respond to direct mail,” says DiLoreto, “because oftentimes that’s how they came onto the lists. But response rates from telemarketing and e-mail are not as good.”
Sutton agrees, adding that broadcast media also doesn’t pull high response rates from this demographic.
However, the multi-touch approach can work for some marketers, says Schwedelson. “We’ve seen some lists with sister e-mail lists, so the marketer can do coordinated campaigns. Another effective tactic I’m seeing is to follow up one direct mail piece with another that has a more targeted message.”
Morningstar, which rents lists for its own lead generation, reels in new subscribers by using trial offers and samples of research reports. For example, new subscribers to its Dividend Investor newsletter get three free research reports.
Online, Morningstar employs search engine optimization. “Search is the No. 1 way that people find us on the Web,” says Dahlen. “So we make sure our content surfaces naturally when the content the searcher seeks is relevant to our product lines. We also use banner ads, and we base our messages on if the person is a new or repeat visitor.”
Effective Marketing for the Incredulous Crowd
When targeting individual investors, a direct and honest approach works best, says Dahlen. “Conversely, get-rich-quick schemes and other sensationalistic messaging don’t work. Our clients are long-term investors who see through these messages. They know that the long-term approach to wealth accumulation is much more realistic.”
Because individual investors tend to be research-oriented, offering accurate and timely content is a good way to endear this demographic. Says Hagerty, “We find that Vanguard gets covered a lot in educational circles; professors talk with their business classes about us. That’s because educators can use our Plain Talk investing education series of articles to help facilitate those conversations.”
One important thing to bear in mind when targeting investors: Teaser rates, overt calls to action and other traditional direct marketing hooks don’t tend to work well for this market, says Hagerty. “You have to be honest, direct and patient with this group.” It’s a well-educated market that tends to make careful buying decisions, he notes.
Shop Smartly
When hunting for lists of investors, look at usage, household income and the price point of the item that got people onto the file, advises Schwedelson. “If it was a subscription, look at the price of the publication. Annual subscriptions to some investor newsletters cost hundreds of dollars and could even qualify as luxury items. Such people tend to have serious levels of discretionary income—people not often found on regular mailing lists.”
He cautions that some marketers balk at the small number of names on some investor subscriber lists. “But that’s the wrong way to look at this market,” he says. “There are only a certain number of people in this country with high levels of income and who are investors. So naturally, there tend to be smaller rollouts. Dig deep to get the names you really want.”
Donna Loyle is a freelance writer based in Philadelphia. She is the former editor-in-chief of Catalog Success magazine, a sister publication to Target Marketing.
But many marketers, no doubt, want to reach only a fraction of that population—specifically, high-net-worth individuals who self-direct their investment decisions. This demographic generally has enough discretionary income to buy luxury goods and high-end services and to donate to worthy causes.
“When you run a profile of, say, borrowers vs. individual investors, you find that investors tend to be well-heeled, and they don’t live paycheck to paycheck,” says Sean Hagerty, head of marketing for Vanguard, a Valley Forge, Pa.-based mutual fund company.
Indeed, the American Association of Individual Investors (AAII) reports that its members’ average annual income is $118,792, and their average investment portfolio is $810,000. Registered members of Morningstar, an investment research company that caters to individual investors, report an average annual household income of $110,000 and an investment portfolio of almost $500,000. And 12 percent of subscribers to InvestorsInsight Publishing publications report a net worth in excess of $1 million.
Lists of individual investors tend to include more men than women. For example, 93 percent of AAII members, 79 percent of Fortune subscribers, 74 percent of Morningstar’s registered members and 71 percent of subscribers to the weekly newsletter The Kiplinger Letter are men.
It’s also a highly educated market: 61 percent of investors who subscribe to InvestorsInsight Publishing publications are college-educated, as are 87 percent of Fortune readers. And 45 percent of Morningstar’s registered members have graduate degrees.
Investors also skew older, “because age and wealth tend to be correlated,” says Hagerty. The median age of readers of Kiplinger’s Personal Finance, for example, is 51.
Other characteristics of this market: Do-it-yourself investors have sophisticated tastes. And because they often do a good deal of research before making purchase decisions, they tend to be influencers among family and friends, says Maureen Dahlen, director of product management for Morningstar. “Other people often go to our clients for advice and recommendations. So Morningstar members are respected within their social networks.”
Buy, Read, Donate
As expected, individual investors buy luxury goods, such as high-end electronics, cigars, wine, watches, jewelry, cars and travel packages, says Jay Schwedelson, corporate vice president of Worldata, a list services company that manages the subscriber files of Morningstar, Forbes’ newsletters, Value Line and other publishers covering the investment market. Usage on these lists also includes financial services and credit card companies, he notes.
Investors also are good prospects for publications, seminars and educational materials related to investing, says Jeff Sutton, president of MSI List Marketing, which manages the AAII list. Usage on that file includes, for example, Dow Jones, The Wall Street Journal and The Economist.
Marianne DiLoreto, client marketing manager at American List Counsel, a list services firm that manages the Kiplinger subscriber files, adds that usage on the Kiplinger files include fundraisers such as the American Cancer Society and the American Heart Association, as well as catalogers such as Harry & David and Wine Country Gift Baskets.
Stake Your Claim
“Kiplinger subscribers respond to direct mail,” says DiLoreto, “because oftentimes that’s how they came onto the lists. But response rates from telemarketing and e-mail are not as good.”
Sutton agrees, adding that broadcast media also doesn’t pull high response rates from this demographic.
However, the multi-touch approach can work for some marketers, says Schwedelson. “We’ve seen some lists with sister e-mail lists, so the marketer can do coordinated campaigns. Another effective tactic I’m seeing is to follow up one direct mail piece with another that has a more targeted message.”
Morningstar, which rents lists for its own lead generation, reels in new subscribers by using trial offers and samples of research reports. For example, new subscribers to its Dividend Investor newsletter get three free research reports.
Online, Morningstar employs search engine optimization. “Search is the No. 1 way that people find us on the Web,” says Dahlen. “So we make sure our content surfaces naturally when the content the searcher seeks is relevant to our product lines. We also use banner ads, and we base our messages on if the person is a new or repeat visitor.”
Effective Marketing for the Incredulous Crowd
When targeting individual investors, a direct and honest approach works best, says Dahlen. “Conversely, get-rich-quick schemes and other sensationalistic messaging don’t work. Our clients are long-term investors who see through these messages. They know that the long-term approach to wealth accumulation is much more realistic.”
Because individual investors tend to be research-oriented, offering accurate and timely content is a good way to endear this demographic. Says Hagerty, “We find that Vanguard gets covered a lot in educational circles; professors talk with their business classes about us. That’s because educators can use our Plain Talk investing education series of articles to help facilitate those conversations.”
One important thing to bear in mind when targeting investors: Teaser rates, overt calls to action and other traditional direct marketing hooks don’t tend to work well for this market, says Hagerty. “You have to be honest, direct and patient with this group.” It’s a well-educated market that tends to make careful buying decisions, he notes.
Shop Smartly
When hunting for lists of investors, look at usage, household income and the price point of the item that got people onto the file, advises Schwedelson. “If it was a subscription, look at the price of the publication. Annual subscriptions to some investor newsletters cost hundreds of dollars and could even qualify as luxury items. Such people tend to have serious levels of discretionary income—people not often found on regular mailing lists.”
He cautions that some marketers balk at the small number of names on some investor subscriber lists. “But that’s the wrong way to look at this market,” he says. “There are only a certain number of people in this country with high levels of income and who are investors. So naturally, there tend to be smaller rollouts. Dig deep to get the names you really want.”
Donna Loyle is a freelance writer based in Philadelphia. She is the former editor-in-chief of Catalog Success magazine, a sister publication to Target Marketing.
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