What Is the Value of “Big”?

Years ago I participated in a colleague’s ongoing thought experiment by naming the price point at which something is expensive. My colleague wanted a crisp response without caveats but I couldn’t do it. My first thought was $100, but even then, that was cheap for a flight and expensive for a meal. I’ve revisited the question over the years and despite changing life circumstances, my resistance to naming a number has persisted and even increased as I’ve encountered more examples where it’s all relative. Messaging is rife with caveats, including—and perhaps especially—in the wealth management space.

Is an asset manager big when it serves thousands of clients? Manages billions of dollars? Has been in business for decades? More importantly—and this is the part that is often missed—are these numbers relevant to the customers the firm is trying to reach? Are the numbers communicated with the proper context to make them understandable?

We have ample data to show that the words we use are not always well-understood. For example, see this article from my colleague, Vivek Amin, that describes the dismal self-reported knowledge of fundamental financial terms. I’ve encountered plenty of instances where terms are not well understood by financial professionals either. This lack of understanding extends to numbers. While a number itself might not need defining in the same way, we can’t assume it always has meaning. Industry insiders know when a number is impressive because they have the context. Outside of context, a number is no better than jargon.

I’m reminded of an old Seinfeld clip where he asks why McDonald’s is still counting. “Eighty-nine billion sold. Okay, I’ll have one.” In wealth management the counting does have value. It can communicate liquidity, fund style consistency, company long-term commitment and more. It can also have negative implications, such as a fund seeming too big to pivot and outperform, or slow asset-gathering being an indicator of a less compelling fund. A number standing on its own leaves the reader to determine whether it is positive or negative or of any value at all.

Big numbers aren’t meaningful just because they’re big. Meaning must be imparted. My five-year-old used to think I was 100 years old because it was the highest number she knew, but I recently aged to 140. Make sure your messaging isn’t at risk of such volatile interpretation!

Need help with your messaging? Contact me!