Does Focus on Communications Mean Retirement Plan Participants Will Actually Read Them?


To get retirement plan participants to read and act on benefits information, retirement plan providers should focus on the participant experience, just as marketers of some consumer brands have done, a new report said.

A separate survey found that the majority of employers struggle to get participants to open or read benefits material.

The “experience” approach responds to participants’ desire for personal guidance, and the ability to do things when and how they prefer, in an easy and convenient matter, according to the study, Retirement Communications: The Experience Revolution, by Broadridge Financial Solutions Inc., released in mid-February.

For example, instead of static facts about accounts and transactions, participants prefer personalized guidance and alerts, the report said.

Treating participants as consumers of plan information means that the customer experience is always determined from the customer’s point of view—an approach at which consumer brands such as Amazon, Uber and Starbucks excel, the report said.

“Those who can connect with consumers in a sustainable and meaningful way are building their brands at the expense of those who cannot,” the study said.

In part, this heavy investment in innovation in participant experiences is being driven by the continued pressure to do more with less, the report said. “Today’s providers do not have the luxury of producing ineffective or inefficient communications,” it said. “Every interaction must count, and experiences must be designed based on a scalable infrastructure to deliver competitive value at a competitive price.”

This new approach led by customer experience design is starting to have an impact on participant behavior, said Cindy Volker, senior director of communications and the mutual fund and retirement business unit at Broadridge Financial Solutions.

“Leading providers are taking a step back and thinking holistically about every interaction with participants,” she told Bloomberg BNA. They’re moving toward more personalized in-the-moment messages and away from sending giant communications listing everything about the employees’ benefits.

“They are no longer talking about enrollment books or notices, but rather looking at experiences, and how are we supporting individuals for particular life events,” she said.

In the study, researchers looked at large group of employees who were not participating in the retirement plan. The provider did a personalized “next best step” messaging approach aimed at different generations in the workforce.

For every one “touch point” or personal contact with an employee, there was a 3 percent increase in participation, Volker said. When there were three or more touch points, there was a double-digit increase in participation, she said.

Leading providers are bringing strong capabilities on-stream, Volker said. “Our challenge going forward is providing scale and cost efficiencies to allow smaller providers who haven’t been able to fund these types of programs access to more effective communication tools,” she said.

Disconnect Identified in Survey

The disconnect between the plan provider and the participants is reflected in survey results released Feb. 25 by the International Foundation of Employee Benefit Plans, in which 80 percent of employers said that their top challenge in benefit communications was that participants do not open or read the materials. Forty-nine percent of survey respondents said participants don’t understand the materials, while 31 percent said that participants don’t perceive the value in their benefits.

Employers might want to try new strategies, said Julie Stich, director of research at IFEBP.  “It’s easier to create one-size fits all communications,” but more customized types of communications should yield better results, she said.

Communications with the highest success rates are ones that go beyond the traditional one-size-fits-all approach, she said, pointing to survey data showing that communicating by life stage was ranked as successful by 81 percent of providers.

Other success was reported via customized communications for multiple generations (73 percent), year-round communications (79 percent), communicating in multiple languages (74 percent), and simplifying complicated benefits content (72 percent).

See related article, Employers Straining to Improve Understanding of Benefits.

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