Speaking to ifa, ISA director of marketing Bernie Dean rejected concerns from the financial advice community over the “compare the pair” television commercials, claiming increasing awareness can help consumers understand complex issues around super.
“Super can be complex and most people don’t spend a lot of time thinking about it [so] their interests can be protected by increased awareness and education,” Mr Dean said.
“The Industry SuperFunds campaign promotes awareness of the benefits of being a member and educates people about the things they should consider when choosing a fund.”
Mr Deans added that ISA’s advertising campaigns are funded by 15 industry super funds that have joined together, increasing efficiency.
“It is a cost-effective campaign because the costs are spread over the 15 participating funds, which allows us to have a much greater presence than individual funds alone,” he said.
Meanwhile, Laurie Pennell, director of non-aligned financial planning firm OzPlan, told ifa the “use of member funds to run advertising campaigns to basically attack the financial planning profession using questionable performance figures” is likely to be a contravention of the sole purpose test applied to not-for-profit super funds.
“If we, as financial planners, advertised in the same way as the industry super funds, we would have ASIC knocking on our doors with a request to cease,” Mr Pennell said.
However, fellow adviser and practice principal Gavin Bramley of Unique Wealth said the industry funds’ advertising campaign is not a threat as the more “financially mature client is not swayed by this advertising”.
Should non-profit funds be allowed to advertise? Have your say below
How can they claim that all profits are returned to members, if some of the profits are sent to the ISA? From what I have seen, the ISA is nothing more than an advertising and political lobbying machine which aims to attract new members. How is that in the interests of existing members? Has the increased scale resulted in lower fees or lower insurance premiums? Not from what I have seen. In fact the reverse seems to be true.
Mr Dean is correct – increasing awareness [u]can[/u] help consumers understand complex issues around super.
So how do ads based solely on (dubious)claims about fees meet this criteria? They [u]can[/u] help consumer awareness but ISA choose not to.