Challenge

Large-scale public relations research had begun to position a financial organization as a thought-leader in the industry and they wanted to nurture this perception, grow their influence with the industry and consumers, and cast a wider net in retirement planning.

Method

Multi-phased research was conducted within the industry and with financial consumers, and a cross-functional team that tied in marketing, public relations, academia and strategic research explored key issues facing the industry about retirement concerns.

The research began with a discovery phase. It included secondary research through a review and monitoring of literature and media and full exploration of behavioural economic themes and experiments.

This was followed by one-on-one interviews with industry leaders across all stakeholder groups, including CEOs, C-suite executives, journalists, lawyers, company directors, unions, politicians and consultants, among others.

A series of surveys was employed to look at how the average consumer approaches retirement planning. The surveys were used to validate our hypothesis that individuals are not sufficiently financially literate to plan for a comfortable retirement and to test for behavioural manifestations of their reliance on emotions more than rational economic principals

Discovery

We did indeed confirm our hypothesis in finding that the average consumer does not take a rational approach to retirement planning. We discovered that individuals are so driven by emotional factors like overconfidence and loss aversion that they are ill-equipped to make independent financial decisions and use simple heuristics like naïve diversification following the ‘1/n strategy’ (Benartzi, Shlomo, and Richard H. Thaler.).

Outcome

Our research uncovered the behaviour behind consumer and corporate non-rational decision-making around retirement.

Not only did the company better understand how to guide clients through the retirement investment process, subsequent promotion of the results via an industry/press campaign, academic papers and lecture tour reinforced this company’s position as industry experts and leaders.

Our research process became a model for deeper understanding of other aspects of the client’s investment business.