AstraZeneca’s Bev Haines gets personal with plan member communications.
Trying to get defined contribution pension plan members to diversify their assets isn’t easy. Case in point, AstraZeneca. At the end of last year, a large number of employees at the pharmaceutical company in Mississauga, Ont., had 30% or more of their assets in the default Money Market Fund(a relatively low-risk and therefore low-return fund).
“In a lot of respects this isn’t always top of mind for employees,” says Bev Haines, lifestyle solutions manager at AstraZeneca. And she can attest to that. In order to encourage plan members to actively review their portfolios, AstraZeneca tried generic communications, employee meetings and education sessions. “People have lots on their plate [and] get pulled away to other things rather than coming to one of these sessions,” she says. The medium, it seems, was definitely not the message.
In fact, the message was too generic, having no measurable impact at all on employees. So, in conjunction with Sun Life Financial, AstraZeneca was willing to get up close and personal with a glossy double-sided one-page letter, highlighting the information specific to each individual. “I think it speaks to Sun Life’s capabilities of being able to really target the communication for us. The communication was very much personalized,” says Haines.
Indeed, the member’s name was referred to throughout the letter, as well as the percentage of assets the member held in the default fund. The document was also customized by gender(male or female), language(English or French)and career stage. Sun Life used members’ dates of birth to categorize them into different career stages: early-, mid- or late-career. And retirement planning and diversification messages also matched these stages.
But not all of the more than 1,400 AstraZeneca employees were targeted. “We felt that individuals who had 30% or more of their portfolio in the default fund raised some concern,” says Haines. “We wanted to ensure that these members were making an educated, conscious decision to invest in this fund and not just investing by default.”
After initial work on the communication in late 2006, it was finally ready to be mailed to members’ homes in early January of this year. Although there were additional costs with direct mail, they were minimal. “It definitely was, in my opinion, money well spent,” says Haines.
The results themselves speak to the communication’s effectiveness. By the end of January, 42 employees(9.7% of targeted members)moved more than $1 million of assets from the default fund. In February, 45 employees(10.4% of targeted members) moved money. “As of the end of April, we saw that about 25% of the target members had taken some action,” says Haines. “Even though 25% is not overly high, it was definitely a significant improvement.”
Because this personalized communication had an impact on employees, AstraZeneca would consider it again in the future. “The group that we targeted already, we’ll take another quick look at them later this year,” says Haines. “But if there is another need to communicate to individuals, we’ll take an opportunity to do this on a personalized level.”
Sun Life praises the company for its willingness to try a different approach. “Despite the many attempts they tried, AstraZeneca recognized that traditional retirement talk just wasn’t working…that they wanted to do something more dramatic that would maybe galvanize the employees into taking action,” says Kim Duxbury, assistant vice-president, marketing, communications and education, at Sun Life Financial in Toronto. “Whether that action was picking up the phone or going to the Web, it was at least getting their attention to physically take some step.” A step that proved that this time, the medium truly was the message.
Brooke Smith is assistant editor of Benefits Canada. brooke.smith@rci.rogers.com
© Copyright 2007 Rogers Publishing Ltd. This article first appeared in the September 2007 edition of BENEFITS CANADA magazine.