Sometimes it takes a major change to act as a catalyst to raise standards, and auto-enrolment is that catalyst for improving pensions communication, says Jonathan Clark

There’s little doubt that auto-enrolment is one of the most significant changes in pensions in recent years. The complexity involved in just making sense of the data and tracking who is eligible is a challenge in itself for employers, trustees and schemes. On top of that, any changes required to scheme rules, administration systems and implementing an opt-out process soon add to the list of things to think about, agree and implement. It’s therefore understandable that member communications may not have been at the top of the agenda, beyond issuing the guideline letters suggested by the regulator.

But the old adage ‘you only get one chance to effectively communicate change’ rings true. This is because auto-enrolment presents quite a challenge for workers as well, and if it is poorly communicated employers and schemes can find themselves counting the costs in terms of reputation, as well as financially.

The financial costs can start mounting, for example, when a poorly communicated change generates huge volumes of unanticipated member queries, which can put a strain on both in-house and third party administrator teams and helplines. We have already seen some employers having to draft in additional support at short notice.

The reputational costs come when, in the absence of knowing who to turn to for help or because they do not understand the communication they have been sent, workers point the finger at the name on the top of the letter - and in the case of auto-enrolment, that will be their employer.

But this needn’t be a bad thing. Sometimes it takes a change for us to examine what we have done to date and redress areas that require improvement. For example, how have you communicated your scheme to date? Have you engaged workers with this important workplace benefit, or does it play second fiddle in the benefits package to the likes of holiday entitlement, ‘bike to work’ schemes or corporate savings platforms, which are possibly more recent additions with an associated benefit that feels more immediately tangible to workers? Do existing members understand their scheme and know how to get the most from it?

Communication strategy
Getting communications right is not rocket science, but it does need investment. Spending a small amount up front to support workers effectively through a change can reduce the risk of incurring higher costs later to respond to queries, clarify and address misunderstandings. But most importantly, it’s vital to invest time in understanding your workers’ needs and planning the best ways to support them.

Understanding your workers and their needs is the first step to ensuring any financial investment in communications is spent in the right areas, making a return on investment far more likely. That said you must be realistic about what you can afford to spend on a per capita basis and think about how much you really believe you can achieve for that amount.

As with any change, auto-enrolment needs a communication strategy. This should be a practical, useful reference document that helps you weigh up the pros and cons of any communications activities you look to implement. Here are a few things to consider.

Objectives
All good strategies start with a vision and/or objectives so we all know what we are aiming for. What do you want your auto-enrolment communications to do? State the facts and no more, or help members understand the change and enough about pensions to make an informed decision and mitigate the costs of having to provide that support after ‘go live’?

Other objectives may be more employer-focused. For example auto-enrolment could be the ideal opportunity to revitalise pension communications within your workplace. You might wish to make them more contemporary in how they look and feel in line with your brand. The tone of voice could be more personal and perhaps remind members that this is in fact a benefit of employment. The more workers understand the benefit, the more value they are likely to place on it and the goodwill associated with that value transfers to the employer.

Ultimately for auto-enrolment, the more you do up front, the less you will have to react to later.

Audience
Who are we helping here? A younger audience is less likely to see a pension as a pressing need, however, as we know with pensions, the earlier you start, the better. An older audience may feel the need to act on auto-enrolment more keenly.

Either way the first challenge will be to engage them, gain their attention and answer a common set of questions. What is it, how much will it cost, why is it happening to me, and what will I get?

Involve your workers in your communications planning, drafting, testing and move from assuming what they want to actually knowing.

Media
There are many things that can influence the media you choose to deliver your communications. The stereotype would suggest that the older demographic in your audience would prefer print and the younger workers, online. This is simply not the case anymore, we as consumers want choice and expect it from many of the service providers we encounter in everyday life. For example we may enjoy the convenience of online banking, but still like the reassurance of a printed statement once a month.

There are many trends and fads in communications, but the best developments are the ones that make practical, lasting sense and empower people. One of the most important advances in communications media has to be the advent of truly mobile Internet. Walk down any street, or sit in any train or bus and you will see people, online on their phones and tablets. We can now learn whenever and wherever we want. We can access educational videos, use modellers and calculators and make decisions all in the palm of our hand.

More than 50 per cent of us in the UK now privately own a smartphone and this is great news for employers and schemes with a large, fragmented audience without access to a permanent desk or company-provided PC. Mobile Internet levels the playing field between office-based workers and those in the field or on the shop floor. The good news is that this needn’t be expensive. If you have an online portal, it should not take too much development to make it mobile compliant and if you are still considering a web presence to support your auto-enrolment communications, plan this functionality in from the start.

Yet regardless of the media used to deliver your communications, if the message is poorly conceived, doesn’t convey what your workers need or answer their questions, then no amount of engaging design, new technology or even plain English will fill the gaps in the support you want to offer workers.

Messages
The message is, and always will be, king. Auto-enrolment is an opportunity to redefine how we communicate pensions.

Let’s face it, as an industry we have our fair share of jargon and that’s to be expected with most financial products, services and benefits. However, unlike many high street financial services, pensions can often appear inaccessible and daunting. Think about it from the member’s perspective: not only do you have to get your head around the pension itself, you may also be faced with a bewildering array of investment fund choices and risk considerations, as well as things like life assurance and don’t forget all the associated paperwork that’s required. It’s a challenge to communicate such complexity in an accessible manner, but life can be made simpler for workers if we bear in mind the following.

Less is more, keep information levels manageable, if you over-communicate and try to cram too much in at once, you will give the impression that the volume of learning required is insurmountable.
Soften the tone of voice. If you are monotone, in a matter-of-fact tone of voice, either written or spoken, you will never engage your audience. Try and inject some personality into it.

Answer more questions up front and you will have less to support later on. Many of the fundamentals are covered in the regulator’s guidance letters. However more context and understanding is needed to support workers. A recent Scottish Widows report stated that over 70 per cent of workers expected their employer to support them through this change. That means helping workers understand more than just the auto-enrolment change, but giving them a broader understanding of pensions in general.

As with life in general, we fear the unknown. The more we understand a change, the less scared we become, so as pensions communicators it is our job to acknowledge workers’ fears, recognise what they do and don’t know and answer the questions they need answers to, as well as the ones we have to provide.

Written by Jonathan Clark, head of communications, RPMI

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