SRIworld.com

CAPABILITIES

Qualitative Research
One-on-one in-depth interviews or focus group sessions for purposes of developing preliminary insights into market structure, product positioning, or product or advertising conceptualization.

Consumer Motivation
Determination of the specific mix of characteristics that would maximize consumer acceptance of new products or services. These studies frequently incorporate segmentation techniques which identify discrete groups of consumers, defined in terms of differential needs regarding the product or service category. “Investors’ Choice” is a study of this genre, designed to define the market for socially responsible mutual funds on the basis of investor motivations.

Competitive Structure
Definition of the market in terms of how competitive offerings are perceived by their target audience on characteristics that are relevant to the purchase decision. These studies generally delve into aspects of consumer awareness and experience with these offerings and frequently provide analyses in terms of market segments, defined on the basis of differential needs regarding the product or service category. “CORPUS” (Corporate Responsibility Profiles in the US), a system for the continuous measurement of company reputations among investors is currently on our drawing board.

Concept Testing
Determination of the extent to which individual or alternative product, positioning or communications concepts are compelling to defined audience segments.

Tracking Studies
Periodic evaluation of the effectiveness of marketing activities, including the introduction of new or re-staged products and implementation of marketing communications programs.
CSR Report Monitor is a program by which various aspects of in-market effectiveness of corporate social responsibility reporting can be determined.

Satisfaction Studies
Periodic evaluation of the extent to which investors in individual corporations, mutual funds, and public and private pension funds are satisfied with the performance of these entities on financial and social responsibility criteria.

SRI LANTERN

INVESTORS’ CHOICE

Is your firm considering the development of mutual funds to tap the socially responsible investing (SRI) market? This segment has grown substantially over the past decade, to the point where there are currently more than $2 trillion invested in socially screened portfolios under professional management in the US. However, only $162 billion of these are invested in SRI mutual funds. And, while the $2 trillion figure represents about 11% of all dollars under professional management, the $162 billion figure translates to less than one of twenty dollars invested in mutual funds. Why the discrepancy?

We believe that investments in individual stocks more easily satisfy the social criteria of investors than do investments in SRI mutual funds. And, the reason for this might be that mutual funds are not customized to take into account the specific values that motivate each investor. By their very nature they require that investors settle for what is available to them on a de facto basis.

While this trade-off approach is perhaps acceptable in reference to funds that are designed to reflect the tenets of religious organizations, it runs contrary to the “customer satisfaction” credo to which most marketers claim adherence today. New or re-staged funds must be meaningfully differentiated from the pack in terms of their investor targets, as well as the extent to which they are aligned with the values of those segments of investors.

Sensitivity to the needs of investors requires an understanding of the specific combinations of screens that they are looking for, as well as the value they place on shareholder action and community investing. And, as investors are not homogeneous in this regard, it is seemingly unlikely that another “one size fits all” SRI fund would generate more than modest appeal. It is even easy to envision scenarios in which additional screens, intended to further broaden a fund's appeal (companies that manufacture birth control products, for example) could negatively alter its acceptance profile.

Investors’ Choice will address issues relating to the importance of specific criteria to mutual funds investors, both as the basis for fund acceptance and rejection. And, it will segment the market for such funds into discrete groups of investors, defined in terms of combinations of criteria that would maximize fund acceptance to each.

Investors’ Choice will provide a comprehensive understanding of the market from the standpoint of what investors are looking for in a SRI fund. As such, it represents a seminal tool for strategic planning, new product development and marketing communications regarding the category.

If you have any questions or care to discuss any aspect of Investors’ Choice, please contact Doug Wheat or Mel Kram at 802-251-0500 or by email.