Cogent Reports: Empower Retirement Voted Best Value for the Money by 401(k) Plan Sponsors
CAMBRIDGE, Mass.–(BUSINESS WIRE)–Amid an environment in which fee scrutiny is more rigorous than ever,
Empower Retirement emerges as the provider that 401(k) plan sponsors
attribute most with providing good value for the money. More than four
in 10 (43%) plan sponsors aware of Empower believe the firm provides
good value, up from 27% a year ago. These and other findings are
included in the annual Retirement
Planscape®, a Cogent
Reports™ study by Market Strategies International.
“Plan sponsors are more focused on fees than ever before,” notes Julia
Johnston-Ketterer, senior director at Market Strategies and co-author of
the report. “In fact, for the first time the aspect of reducing plan
costs outranks all other priorities upon which plan sponsors are
directing their attention.”
Moreover, the report found that plan administration fees are the most
common reason for switching record-keepers, and likewise are an
important driver of satisfaction and loyalty when client expectations
are fulfilled. Importantly, the aspect of providing good value for the
money is the leading enhancer to brand consideration this year,
reinforcing the point that plan sponsors are seeking value from a
provider beyond that which hits the bottom line of their company’s or
their participants’ quarterly statements.
“The aspect of value is not just about being the cheapest,” explains
Linda York, senior vice president of the Financial Services division at
Market Strategies. “It’s more about justifying the fees that you charge
and demonstrating the benefits of the service you provide in a way
that’s meaningful to your target audience.”
The full report examines brand perceptions overall as well as by plan
size segment, noting any pertinent differences. Empower, for example,
has substantially improved its brand recognition in the smaller end of
the market and is really resonating among these smaller plans with its
commitment to the industry and efforts to serve DC plans of all types
and sizes.
“Yet Fidelity Investments and Vanguard still rule the roost in the
larger end of the market,” York continues, “benefiting from their
well-earned reputation for being easy to do business with along with
providing the greatest value for the money.”
Providers Most Associated with “Good Value for the Money”
Among all plan sponsors
- Empower Retirement
- Ascensus
- Fidelity Investments
- Betterment
- OneAmerica
- Vanguard
- Paychex
- American Funds
- ADP Retirement Services
- Wells Fargo
Source: Market Strategies International: Cogent Reports™, Retirement
Planscape®: May 2016
About the Retirement Planscape Study
Cogent Reports conducted an online survey of a representative cross
section of 1,435 401(k) plan sponsors from February 15 to March 15,
2016. Plan sponsor survey participants were required to have shared or
sole responsibility for plan design, administration or selection and
evaluation of plan providers or for evaluating and/or selecting
investment managers/investment options for 401(k) plans. In determining
the sampling frame for this study, Cogent Reports relied upon the
Standard & Poor’s Money Market Directories (MMD) and ALM’s Judy Diamond
Associates databases. To ensure the population for this research was
representative of the universe of 401(k) plan sponsors, quotas were set
during the data collection phase around key firmographic variables
including total plan assets, number of plan participants, industry and
geography. Minimal weighting was applied to adjust for purposeful
deviations from the actual marketplace distribution. The data have a
margin of error of ±2.59% at the 95% confidence level. Market Strategies
International will supply the exact wording of any survey question upon
request.
About Market Strategies International
Market
Strategies International is a market research consultancy with deep
expertise in consumer/retail, energy, financial services, healthcare,
technology and telecommunications. The firm is ISO 20252 certified,
reflecting its commitment to providing intelligent research, designed to
the highest levels of accuracy, with meaningful results that help
companies make confident business decisions.
Market Strategies conducts qualitative and quantitative research in 75
countries, and its specialties include brand, communications, CX,
product development, segmentation and syndicated. Its syndicated
products, known as Cogent Reports, help clients understand the market
environment, explore industry trends and monitor their brand and
products within the competitive landscape. Founded in 1989, Market
Strategies is one of the largest market research firms in the world,
with offices in the US, Canada and China. Read Market Strategies’ blog
at FreshMR,
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Contacts
Market Strategies International
Anne Denz, 617.715.7611
anne.denz@marketstrategies.com
