Technology Reshaping Participant Communications

A new study finds plan providers are turning to cloud-based technology and other solutions to enhance targeted communications toward different age groups.

By Javier Simon | June 01, 2017
Page 1 of 2 View Full Article

The retirement savings gap in America stands at $7 trillion, according the latest research by Broadridge Financial Solutions. The firm also finds that 45% of working American households have no retirement assets at all. But even when offered workplace retirement plans, several employees aren’t contributing.

To address these issues, Broadridge finds several providers are reimagining targeted participant communication by leveraging data analytics, participant preferences, and multimedia campaigns.  

The firm notes that providers are moving away from costly “legacy platforms” that rely heavily on custom coding to modify campaigns, as well as on IT support. Instead, providers are finding value in cloud-based technology that allows managers to streamline content and easily make changes across multiple communication channels including digital, mobile, and print.

With that said, it’s important for employers to understand the participant demographics and demands of their workforce in order to create or improve segmentation programs.

According to the U.S Bureau of Labor Statistics, Millennials make up more than one-third of the American working population. That figure is expected to jump to 50% by the year 2020, making this generally tech-savvy generation the fastest growing cohort. Still, there are more than 60 million Gen Xers or those born between 1965 and 1979 in the workforce. And people are staying there longer. Today, a record number of Baby Boomers older than 65 are still working, with 12% reporting they don’t plan to retire at all. More than 30% of those between the ages of 65 and 74 expect to still work in 2022.

“You have to communicate differently to each one of those groups,” says Tim Slavin, senior vice president, Retirement at Broadridge Financial Solutions. “People want to be able to be communicated to in a way that’s easy for them. They may not want just an email and they certainly don’t want just paper. But they do want to get information that’s more meaningful to them and matters to their age group.”

He tells PLANSPONSOR that multi-channel communication strategies should revolve around segmentation of different plan populations based on various factors such as communication preferences and the type of information they seek, whether it be current plan health or ways to generate retirement income. 

“Millennials may get documents talking about the challenges of having a long life ahead of them,” he explains. “And while retirement may seem like it’s 40 years away, the only way they’re going to be able to retire is to start planning now.” In such a case, younger participants may be encouraged to save more if they see digital, yet simple, graphics depicting what they could be generating by increasing contributions by even a small amount.

“That’s not the same thing someone who is 65 and still in the plan would be getting,” says Slavin. “That person may be looking for information on how to turn their savings into retirement income.”

Of course, a big part of developing these campaigns would rely heavily on the strength of a provider’s analytics capabilities. For example, Slavin points out that plan sponsors would be particularly concerned with identifying participants who are not contributing enough. Messaging targeted at this group could revolve around several key points like the amount they could potentially earn if they were to increase savings rates by a certain amount, what they could be missing in company matches, or whether they are eligible for perks like being able to make catch-up contributions. However, this kind of communication needs to be ongoing.

“One reminder is not enough,” suggests Slavin. “It’s something I think needs to be delivered quarterly or twice a year. Because inertia can slow people down, it has to be a little more aggressive to make sure participants continue to contribute.”

Furthermore, strong data analytics can offer insight into intricate participant details such as how often they engage with plan information, and even when they consume it.

“People get the information when they want to get it,” says Slavin. “They don’t want to wait for their paper to arrive.”

NEXT: Benefits of a Strong Communications Strategy