Comment: Brand Building Materials

Overall, 2023 has proven a challenging year for private markets firms, with higher cost of capital and rising interest rates, geopolitical uncertainty and diminished opportunities for monetization. The industry is facing fiercer competition than ever, thrusting brand building and social media to the forefront for private markets players looking to stand out from their peers to attract the best deals, capital and talent.

With 2024 set to face a similar market environment, private markets professionals are recognizing the importance of brand in achieving business objectives. When it comes to meeting their commercial objectives, firms are getting much more creative and are also increasingly putting more spend behind their activities to achieve their goals.

Examples of this we have seen include greater content diversity, paid targeting on LinkedIn, firmwide rebranding and website redesigns. We have seen this play out with several effective campaigns launched by firms this year, notably Apollo Asset Management’s ‘9@9’ content series. Reinforced by the results of our recently published annual Private Markets Survey, five key themes that we have seen emerge as a result of this trend in the last year are examined below.

Brand takes center stage
The focus on brand strength and visibility continues to be pertinent among private markets professionals, with 80% of LPs and 88% of GPs acknowledging the increasing importance of branding in the current environment. Brand visibility emerged this year as the main driver as firms are becoming more reliant on their brand value to stand out from their peers for deals and capital.

Social media adoption accelerates
An overwhelming majority of respondents (93%) currently use social media platforms like LinkedIn to support their commercial objectives – a notable increase of 10% since 2022. Furthermore, 63% of respondents intend to further increase their use of LinkedIn in the coming months, which indicates a growing reliance on digital channels.

Channels such as LinkedIn are constantly evolving and releasing new features, such as AI-enabled tools, to better serve their audiences and encourage thoughtful discussion on the platforms, so keeping up with these developments is also crucial. LinkedIn has even gone so far as to start removing inactive accounts from its platform, so it is no longer viable to treat your company page as a placeholder.

(Engaging) content is king
This year’s survey explored the preferred content types among various groups, revealing a shift in preferences around content format.

Videos unsurprisingly ranked as the most engaging content type on LinkedIn, with 53% of LPs citing video as their preferred content type (compared to 31% in 2022). Infographics have grown in popularity as well, becoming the second choice for 33% of respondents (up from 17% last year). This shift reflects wider social media industry research that shows video continues to be the format that drives the highest engagement across most social platforms.

It is worth bearing in mind that, while highly digestible and visually compelling content such as video performs best on social media, ensuring you are posting a varied mix of engaging content formats (video, static carousel posts, polls etc) is a best practice to adhere to, to ensure your audience continues to be interested and engaged online.

Executive visibility extends online
While many GPs have taken to social media as a way to elevate their brand and increase awareness of their specialized capabilities, they have also used it to elevate the profile of their key leadership. In fact, GP respondents cited sharing thought leadership as a top reason for using social media platforms like LinkedIn and we are increasingly seeing more senior executives (C-suite, founders) wanting to discuss standalone executive visibility programmes.

Being a known expert in a particular sector or investment style can certainly aid during fundraising periods. A notable example of this is Blackstone’s Jon Gray, who launched his LinkedIn profile earlier this year to much furore, quickly gaining a large following on the platform.

Audiences – including investors, employees and the media – now expect greater access to leaders. Those that have embraced social media and established a strong digital presence now have a distinct competitive advantage.

Paid media prevails
GPs are strategically leveraging paid media on platforms like LinkedIn, with roughly a third consistently using paid media as part of their overall social media strategy to directly target LPs.

Many social platforms are set up as ‘pay for play’ to a certain extent, in that organic content can only reach a certain number of users, whereas paid media allows you to reach a much wider and targeted audience in an effective manner. Therefore, paid media should be a core consideration in any social media strategy. This approach allows brands to strategically reach niche and targeted groups, such as LPs, in a meaningful way.

The road ahead
As the private markets landscape continues to evolve, firms and professionals alike must prioritise the power of brand and digital channels, and we predict this behaviour, and resulting competition across the industry, will only accelerate.

The firms that invest proactively in more sophisticated marketing and communications strategies, build out a robust digital presence leveraging engaging content, thought leadership and paid media, are the ones positioned to stand out.

As we move into 2024, below are the top things firms should consider as we face considerable headwinds:

• Focus on brand: Beyond a logo and visuals, develop a robust brand strategy that showcases your firm’s core values, messaging and positioning in the market to better tell your story. Private markets branding across firms has typically been relatively homogenous, so consider if there are new ways to reflect your differentiators through your branding.
• Accelerate digital: Enhance your online presence by leveraging digital channels such as your website and LinkedIn page to share owned content at a more regular cadence to demonstrate what you stand for as a brand and your firm’s momentum. Also encourage executives and employees at your firm to post frequently to LinkedIn, resharing company posts to help expand their audience.
• Amplify with paid media: Organic content will only reach so far in the current attention economy. Leveraging paid media such as paid search, paid social and display advertising will increase visibility of your brand and allow you to reach highly targeted audiences in an effective manner, including key LPs, targets and prospects.