Baillie Gifford  

Baillie Gifford goes digital to grow client numbers

Baillie Gifford goes digital to grow client numbers

Giant asset manager Baillie Gifford is looking to capitalise on the growing use of technology and virtual interaction which it hopes will boost client numbers and allow it to reach younger investors.

James Budden, director of marketing and distribution at Baillie Gifford, told FTAdviser that interactive tools — such as webinars and video conferencing sites — were now “front and centre” of Baillie Gifford’s marketing communications plan and would expand the fund house’s reach.

He said: “We at Baillie Gifford believe that we will now be able to reach bigger audiences and more easily than before through these digital platforms. 

“We are committed to a long-term strategy to develop our engagement with the evolving adviser marketplace and with the direct consumer.”

Mr Budden said while the number of advisers was “growing again”, the number of direct consumers involved in the investment marketplace was “getting younger at last”.

He added: “For years the hobbyist or private investor was tagged as circa 60 years old plus. 

“Investment platforms now tell us that the average demographic is heading south especially among new clients who are not traders, but investors spurred on by Sipps and pension reforms. The millennial is becoming middle aged.”

Trusting trusts

Baillie Gifford also hopes to grow its market share by converting investors to closed-ended investment vehicles through strong performance and their ability to invest in private companies.

The fund house is the largest provider of investment trusts in the UK and is manager of the sector’s flagship Scottish Mortgage trust, one of Scotland’s biggest listed companies.

Mr Budden said: “We live in hope that we can convert investors to the closed-ended faith primarily on the twin plinths of performance and private companies. 

“The former is a constant in that across most sectors trusts outperform funds while the latter has the potential to be a game changer.

“Companies remain private much longer these days and investment trusts are structured to eat starter and main course, before having to share pudding with their open-ended cousins.”

The Scottish Mortgage trust has done well from investing in private companies before they list on the public exchange.

It invested in Alibaba in 2012 as a private business when the company had a £45bn price tag. By the time Alibaba listed in 2014, it was worth £158bn.

Other well-known, private companies in the portfolio include Spotify and TikTok.

Mr Budden added: “[2020] will be forever more synonymous with the Covid pandemic and the terrible damage it has caused in human terms. In a business sense the advent of the virus appears to have accelerated changes which were occurring already. 

“For the most part, Baillie Gifford’s portfolios have been well positioned for the new normal. Traditionally our active growth approach would have been expected to stall during a time of crisis. 

“This has not been the case through lockdown and tiers whose effects have amplified the power and scope of the digital economy at the expense of the physical.”