How to ‘master’ a new market – learnings from the master trust sector
The successes and struggles of the master trust market, a sector predicted to have £554bn of defined contribution (DC) assets under management in the UK by 2030, establish it as a unique case with interesting learnings for growth businesses across the UK.
Within this crowded space, LifeSight’s focus on providing an innovative, secure pension scheme with a clear emphasis on achieving the best retirement outcomes for members has seen it achieve market leading growth. We are currently transitioning 12 schemes from six clients worth around £2.4bn, and have established a strong pipeline for the coming months.
Here, David Bird, Head of Proposition Development of LifeSight UK, shares his advice for companies looking to expand into a new market based on key insights from his sector.
From the outset, innovation has been a key driving force behind our ambition to deliver true efficiencies, lower costs, and thus greater value for LifeSight’s members. In today’s technological age, harnessing innovation forms the crux for sustainable growth in any sector, whether recently established or not.
By making it your mission to constantly look for innovative ways to meet the requirements and solve the pain points facing your customers, you can continuously seek to establish yourself as the go-to player in your space.
Pushing the envelope is part of our DNA – an attitude that has not just helped us to meet individual client needs, but also to address broader industry issues, such as increasing member engagement. Our resolve to tackle this sector-wide challenge drove the development of a user-friendly online portal for members (something surprisingly uncommon across the industry) and the introduction of LifeSight Age. This online tool educates members on the age at which they can afford to take their pension savings (their LifeSight Age) and how this can be influenced through contributions and investment decisions.
We won’t be stopping there either – innovation will remain at the heart of everything we do to meet and anticipate the evolving needs of our sector. As such, we are currently working on rolling out engaging video benefit statements. Watch this space…
Belief in what your organisation is doing, and importantly, knowing why you are ultimately doing it, is integral to long term success. Leading by example through good governance or business practices will inspire passion amongst employees, with the power to fundamentally shape your industry and, as a result, attract business.
We don’t just want to lead the market in our approach to pension investments, but aim to work with government and the industry to ensure the sector is accountable, sustainable and successful -starting with ourselves.
Much of our focus in this area has been on establishing strong foundations for LifeSight, based on our own ambitious goals and criteria. This has meant that even when official regulation was lacking across the sector, having confidence in our proposition and keeping member interests at our core, saw us prevail.
Quality marks and awards
A positive consequence of the approach outlined could be recognition of the work being done, for example in the form of key accreditations or influential industry awards. Organisations with strong foundations, a culture of innovation and a drive to deliver a leading high-quality solution at their core will stand out from the crowd without having to try as hard.
In the master trust market, out of the 80 or so active players, only a handful of providers, including our own LifeSight scheme, have obtained the PLSA Pensions Quality Mark Ready status, PLSA Retirement Quality Mark and the Master Trust Assurance Framework accreditation.
As the LifeSight example shows, new sectors can present a great opportunity for growth. But in order to achieve success, organisations should start out with a clear vision to drive their key decisions and activity. More often than not, success and sustainable growth result from a desire to deliver quality solutions through innovation and a clear mission, even if this evolves along the way.