Andrew Short questions whether the web alone is sufficient to reach an apathetic population and how social media can help boost member engagement.
"Most human beings have an infinite capacity for taking things for granted"
Aldous Huxley was not talking about pensions when he wrote this, but the message holds true in any case.
There is a general feeling of apathy around the subject: many people are not considering how they will keep up their current lifestyle when they retire.
Auto-enrolment may not have the dystopian overtones that Huxley’s Brave New World has, but it is a social experiment that will have an impact on many futures in the UK and will certainly change the focus of DC pension scheme communication.
Alongside the advent of auto-enrolment we will also see the introduction of the National Employment Savings Trust (NEST), which is predicted to have six-eight million members when it is up and running.
Even the largest pension schemes in the UK do not even get close to this number of members implemented.
Of course, DC schemes will be keeping an eye on how NEST communicates with its members and we may see schemes looking to imitate aspects of its approach over the coming years.
After months of research, NEST has decided to use the internet as its main point of contact and for information.
This is drawn from a number of factors highlighted during focus groups and research demonstrating that members want clear and concise information.
They want to feel empowered and not overloaded with choices.
In addition, it is worth noting that NEST will have to communicate with people who may not have English as their first language and communicate with people who have only a basic financial knowledge.
NEST will be dealing with employers who may only want to tick compliance boxes and have little time and resources to deal with pensions.
NEST director of communications Graham Vidler explains the decision to use a primarily internet-led communications strategy: “Go back two or three years, NEST was called the Personal Accounts Delivery Authority (PADA).
In the early days of PADA, the team were looking at how they were going to provide a great product, customer service and meet the low-cost ambition the government set.
“We realised we needed to enable people to self-serve online, because one of the things that drives cost is paper flowing through the system, delivering content in multiple ways, relying on face-to-face contact and so on.
NEST took the strategic decision to be online and that works well with employers’ preferences.
They want to spend as little time as possible dealing with pensions. People in the target market are likely to use the web for financial transactions.”
When members start contributing to NEST they will be able to log-in and access the website to check the status of their account.
Members will also be able to opt for communication by post. Vidler says: “We will allow members to state the channel.
One of the differences between the online and offline experience is online you can see your fund value updated daily.
If you don’t want to transact online we’ll provide support through paper and telephony.”
Alongside these communication methods NEST have also set up a YouTube channel with a number of videos, but at present (and according to Vidler this is because members are not using the site yet) they only have a low number of viewings.
Vidler is also confident of the benefits of online services: “The good thing is you have metrics to collate how many people are looking at the website and using it.
This sort of data will only be available once the site has gone live.” Many other pension schemes will be looking to get their hands on this data to see if it can help them in their own communications.
However, not everybody is convinced by online communication. BlackRock head of UK DC business Steve Rumbles says:
“The general use of online communications is still disappointingly low; I would say that from an industry point of view you’d hope you’d have 50% using the internet – the reality is a much lower number. This is caused by member apathy.”
It seems the internet must be used in a more holistic and dynamic way if the communications messages are to come across well.
DC pension schemes are devoting more time to creative ways of communicating and are using social media, corporate platforms and personalising communication to do this.
Again it will be interesting to see what impact auto-enrolment has on how schemes develop communication messages.
