What makes an effective pensions communications strategy?

Need to know:

An effective pensions communications strategy is crucial to ensure that all employees are engaged with their retirement savings.
Design, branding and language are all important factors to consider when creating a communications strategy.
New technology has given employers the opportunity to offer a personalised experience through tailored messaging.

Pensions communication can use a variety of approaches to make workplace retirement savings more engaging and appealing to employees. Some organisations, for example, actively focus on targeted channels and nudges, while others use an education route to encourage employees to take an interest in their savings.

In addition, the Covid-19 (Coronavirus) pandemic has increased the importance for employers to offer more information online and communicate more innovatively.

Extra importance of pensions communications

Introducing a dedicated pensions communications strategy with personalised information has become important in recent years, says Karen Bolan, head of engagement at AHC. “Employees being able to identify that a scheme is about them is something that employers need to fully understand if they are going to encourage employees to engage more with their retirement savings,” she explains.

There is also a need for greater engagement with employees that are at the start of their savings journey, as well as those that are near retirement. Jason Green, head of workplace research at Benefits Guru, says: "Many employees who are not close to retirement may not be engaged in pensions, especially those under the age of 45. Getting engagement is the biggest hurdle.

“Generally employees, towards the start of their careers, begin to contribute to their savings but do not see it as an important aspect of pay until 10 to 20 years later. Organisations can help employees engage with this early on in their career to have a bigger impact long-term.”

A communications strategy which demonstrates the reasons why employees need to be invested in their pensions is, therefore, imperative.

Communications scheme design

To increase interest in pensions, employers have taken steps to make the topic more engaging and accessible. “In the last 18 months, employers have created a more engaging experience for members of pensions [schemes] to consume, due to younger age groups not being as engaged in savings and retirement," says Green.

“The engagement aspect of a pensions strategy is incredibly important. Employers must explore alternative options than just text communication.”

Interactive videos and online webinars can be an effective method of making pensions more appealing, as well as quickly and easily accessible.

The design and branding of a pensions strategy should be carefully considered. “Employers must provide a consistent design and branding around a communications strategy to make it feel more personal to employees," says Bolan.

Giving a communications scheme a brand allows employers to be more creative and visual with their messages. "As human beings, we are far more receptive to imagery than we are to text," Bolan adds. "If there is a strong branding behind pensions schemes, then there is so much that can be developed to create an effective experience.”

A brand can be used to create interactive infographics, engaging videos and informative articles, and tie together all the elements of a scheme. It should be relatable according to the industry sector that an organisation operates in, as well as its job roles, in order to create tailored communications that really grab attention. “It can be more meaningful to staff if they can tell that the communications strategy is branded to suit them," says Bolan.

The branding of a communications project can reflect the values or purpose of an organisation, to tie in the message that this is a workplace pensions scheme and that the employer is investing in its staff. Maggie Kearney, defined contribution consultant at Redington, says: “So much has to be invested into what it looks like and feels like to make it relevant for all employees, it needs to also have longevity so it does not become dated a few years down the line.

“A pensions communications strategy is often an afterthought for many organisations so, from the start, the design must follow on from the purpose of the organisation and what it is trying to achieve through the branding."

Language and character

Using creative or attention-grabbing language in a communications strategy will also act as a hook on which to draw in employees. “Language is an aspect that many employers state as being a barrier to engaging employees in savings and retirement," says Bolan.

Anything that organisations can do to introduce descriptions that invoke goals and aspirations can be a way of portraying a certain brand identity. Pensions communication strategies with words such as ‘your tomorrow’ or ‘lifetime savings’ can encourage employees to engage in the scheme, as these phrases are seen as more direct and ambitious.

The role of pension communications is to draw employees' attention to their pension scheme and understand why they should engage with it. The overall message behind a scheme must be clear to the employee, and every organisation has certain ways of communicating with staff; this strategy should replicate that in the best way possible.

“People are comfortable with using online shopping platforms or news apps; employers have tried to create a similar experience for communications strategies," adds Kearney. "However, if the language and text are not simplified enough then employees may become disengaged.”

Tailored messaging

Although the design and feel of a communications strategy should stay consistent, different messages can be delivered to different employee groups. Communications, therefore, need to differ for employees at different stages of their careers, says Steven Hull, partner at law firm Eversheds Sutherland: “For younger staff, the risk is they opt out of their pension scheme because of opposing priorities or [they] fall into the mistake of thinking they do not need to think about it simply because they have been auto-enrolled into a scheme.

"The message may need to be around saving earlier, saving more, and saving appropriately. Communications stressing the benefits of compound interest and how even small incremental changes to their annual contributions over time could help them make choices and significantly improve their retirement options.

"For employees closer to retirement, communications might usefully focus on the risk of scams, and signposting staff to useful sources of information to guide them through their retirement options."

Communications can also be tailored by job position, salary bands and location. Rather than sending a similar message to everyone at the same time, organisations can use their employee data to send out personalised messages. "Employees all over the globe are at different stages in their lives; consequently, it is up to [the employer to] use its data to understand what situation employees are in and adjust the message accordingly, all while maintaining brand and design when doing so," says Green.

Creating a pensions communication strategy can be an ongoing challenge, especially due to the effects of the Covid-19 pandemic and many employees working remotely. However, the results it can bring by engaging employees with their pensions can have a long-lasting impact. Bolan concludes. “A savings and retirement scheme is the most expensive benefit for employers to provide but the least appreciated and understood incentive. Every organisation should now be investing in an effective pensions communications strategy and revisit it annually.”

Kerry Shiels: An effective pensions communications strategy needs a winning formula