Source: WSJ Europe Feb. 8th, 2001

In Europe, American Asset Managers
Lead in Developing Brand Awareness

By SARA CALIAN
Staff Reporter of THE WALL STREET JOURNAL

LONDON -- Brand-name buzz counts in hawking hamburgers and cigarettes. It also matters in the more rarified world of mutual funds.

Like McDonald's and Marlboro in the consumer-products sector, three U.S. mutual-fund companies are being cited in a new study for forging familiar brand names in Europe.

Fidelity Investments, Chase Fleming Asset Management and Merrill Lynch Investment Managers are singled out as Europe's best-recognized mutual-fund brand names in a study being released this week by London-based market-research firm Sector Analysis Ltd.

The survey ranks asset-management companies according to the strength of their brand name as suppliers of third-party, nonproprietary mutual funds across eight major European countries: France, Germany, Italy, Switzerland, Sweden, the Netherlands, the U.K. and Spain.

Breaking From the Pack

In what Sector Analysis Director Magnus Spence calls a "crowded market," some mutual-fund brands are breaking out from the pack. "The strongest brand names are not dependent upon their home market," says Mr. Spence. "These companies have an international marketing plan and are gaining brand power."

Sector Analysis interviewed more than 900 people from institutions that use and distribute mutual funds. The three brands cited are included in the top 20 most-mentioned mutual-fund brands across Europe, and are also in the top 20 in more than half the countries surveyed.

The methods by which brand names have been developed in Europe differ by country and company. Merrill Lynch Investment Managers boosted itself to the top ranks of brand names in Europe by acquiring Britain's former Mercury Asset Management, while Chase Fleming Asset Management was lifted to the top ranks after Chase bought Britain's former Fleming Investment Management. Meanwhile, Fidelity has grown by building on its own brand name in Europe.

As the mutual-fund industry grows in Europe, a company's brand name will become increasingly important to attract investors. "Building brand names in the financial industry is about building trust," says Alex Batchelor, managing director of Interbrand U.K., a brand consultancy that is part of Omnicom Group Inc. "People don't necessarily look for the latest star fund manager. They want to give their money to someone who is going to be around for the next 35 years to pay them back."

Through a combination of advertising, investment seminars and other marketing techniques, Fidelity has developed a strong financial brand throughout Europe. Fidelity spent about $100 million (107.5 million euros) in the past five years for its pan-European marketing and advertising effort, according to Richard Wastcoat, managing director of Fidelity's U.K. mutual-fund business.

Consistent Message

Fidelity keeps a consistent message using the slogan "Trust the World's No. 1 to deliver" in advertisements in newspapers and magazines throughout Europe and the U.K. In Germany and the U.K., Fidelity also posts large billboards. Occasionally, Fidelity sets up a booth at London's Waterloo train station and has employees pass out marketing materials. Fidelity backs up its advertising every year with hundreds of investment seminars for professional advisers, distributors and individual investors throughout Europe.

"We are showing that Fidelity is consistent in performance and service," says Mr. Wastcoat. "Investing is not just about buying one hot fund, it is a complete relationship."

Merrill Lynch, which acquired Mercury a few years ago, made a big marketing push last year to brand most of its products with Merrill's name. There is still a range of funds called Mercury Selected Trust, sold from Luxembourg under the brand name MST. In the survey by Sector Analysis, both the brand names Merrill and Mercury were added together to lift the parent company to the top of the list.

"We don't spend as much as other competitors, but we have made a leap in our focus on brand name development," says Elizabeth Corely, Merrill Lynch Investment Managers' head of marketing in Europe, the Middle East and Africa. "We have a marketing strategy that combines the global strength of the Merrill Lynch name with local country focus."

Ms. Corely says Merrill often works with local distributors to build campaigns in different European countries. "In Germany our distributors wanted to send out Merrill investment kits," she says. "In Spain we are looking at joint advertising with our distributors. We don't just take a U.K. ad and translate it into German or Spanish."

The challenge of keeping a brand name in the midst of mergers is putting the Fleming name to the test. The recent merger of Chase Manhattan Corp. with J.P. Morgan & Co. has overturned the apple cart on branding Chase Fleming Asset Management, which was formed about a year ago when Chase bought the former Fleming Investment Management. Now the whole combined organization is going to be called J.P. Morgan Fleming Asset Management.

"We are in the midst of telling our clients right now and formulating a new marketing campaign," says Simon Crinage, marketing director at Chase Fleming Asset Management. "The name Fleming is well-known in Europe, and the message is: The heritage of strong performance will continue. We are communicating with our clients very closely, but it is too early to say what the marketing blueprint will be under the new name."

Write to Sara Calian at sara.calian@wsj.com