Marketing for forex brokers: MT4/MT5 PAMM and MAM Software
In “Loyalty Programs: Marketing for FX Brokers in the Age of Advertising Bans” we explored how forex marketers can use loyalty programs as a tool to attract new clients to their brokerages. Now we shall look into money management services. By diversifying your offer with new services you can attract a completely new audience of potential customers.
In some cases, introducing money management services may be a great enhancement to a forex broker offering, since it works both ways:
- allowing experienced traders to trade larger volumes by managing trusted investments
- attracting new customers who want to diversify their investment portfolio.
Customers’ Needs and Feedback
Before you proceed to select the technology that best suits your business model, start the research from getting a clear understanding of which service or functionality your clients would like to receive.
According to Google Trends “pamm account”, “mam account” and “money management forex” together are searched for over 2000 times each month for the last 5 years. This shows that there is still a good portion of newcomers to forex trading that can potentially become your new customers for the money management offering.
Besides making a general market research, collect some feedback from your current customers.
Create a simple survey and share it on social media and via email.
Gathering valuable feedback from your current customers can ensure that you make the right decision and will not end up purchasing a solution that your customers are not satisfied with.
The differences between money management systems
The next step will be searching what kind of money management technology will be the most suitable for your needs and the needs of your clients. There are several variations of money management systems: MAM, PAMM, LAMM and other variants. We will briefly go through the differences of the most commonly used ones: MAM and PAMM.
MAM (Multi-accounts management) – money manager defines leverage per sub-accounts according to investors’ risk profiles.
PAMM (Percent Allocation Management Module, or Percentage Allocation Money Management) – a form of assets management where all the funds are distributed according to the investors’ share in the PAMM account, which is operated by a money manager.
For example, investor A makes an investment of 50 000 EUR, investor B deposits 35 000 EUR and investor C contributes 15 000 EUR. The total investment is 100 000 EUR with shares assigned respectively 50%, 35% and 15%.
A money manager can act as an investor in the managed PAMM account and receive profit that way, or a performance/management fee can be specified. In the example case let’s make it 20%.
Now when the PAMM account generates a profit of 12 500 EUR, first the performance fee of 2 500 EUR will be deducted. The remaining profit will be distributed accordingly 5 000 EUR to investor A, 3 500 EUR to investor B and 1 500 EUR to investor C.
Now when it comes to a technical side of things, MAM systems usually use investors’ accounts for trading meaning that one order placed by a manager will be split between investors’ accounts in accordance with predefined rules. Whereas PAMM would be programmed in most cases to store/aggregate all investments in one PAMM account, e.g. on MetaTrader and all the trading will be done via that account.
What to have in mind when choosing a specific money management solution
1) Regulations and EMIR reporting
After learning that your regulation does require effective and transparent reporting, you may question whether the PAMM system will be compliant with your regulation if it does not display trades on investors’ accounts in MetaTrader.
At Brokeree Solutions, we have experience in assisting brokers to generate all the necessary EMIR compliant reports. Request more information via firstname.lastname@example.org
2) Supplementary technology
Already from this point, you can see specifics that have to be addressed. In the case with MAM, you might need to consider a more efficient server with better processing power. PAMM does not practically affect trading platform performance, however, since the trades are not displayed on trader’s accounts, some investors find it inconvenient. To tackle the latter specific, Brokeree’s PAMM automatically generates reports that are delivered to investors via emails.
How to promote the service
So, how do we promote such services? There are a couple of options. First will be to align money management offering promotion with your current marketing strategy and utilize the power of digital marketing. The Second will be to organize a close cooperation with your money managers and create interesting and exciting content, e.g. webinars and educational videos, or just provide money managers with bonuses for attracting new investors.
Chances are you already use various digital marketing tools to channel traffic to your websites are quite high, so the starting point will be – displaying new money management offering straight on your homepage. Ratings and statistics module that is provided by the majority of technology providers can be used to display statistics and increase visitors conversion.
2) Online Advertising
Despite a variety of bans on advertising of certain types of trading, a narrow window to utilise online advertising still exists. For example, recent changes to Facebook Pixel now allow collecting your website visitors that come from other channels and target them on Facebook network. Remarketing always a great way to prolong customers relationship, convert leads and generate aftersale income.
3) Social Media
Producing content about your new offering in an interesting way increases chances of it to be shared by your fans and will produce a good amount of organic traffic.
The recent growth of messengers’ popularity provides a yet new channel to reach and most importantly to interact with your customers and leads. Create a sales funnel in the most popular messengers and see conversions rise.
5) Cooperate with money managers in content production
Money managers are always interested in new investors in the same way as a broker is interested in new clients and rising trading volumes. Why shouldn’t those two parties unite their passion and create interesting and informative content to reach new audiences? Nevertheless, we quite rarely see such collaborations in the financial sector. Should we change it?
6) Establish a bonus system for your money managers or Introducing Brokers.
There are plenty of ways to remunerate specific behaviour, whether it is a new deposit made, or a new trader is introduced. Fortunately, almost every forex broker technology provider will have at least a couple of solutions that will help you to set up your own bonus system.
Learn more about different bonus systems in “Loyalty Programs: Marketing for FX Brokers in the Age of Advertising Bans”.
The offer from Brokeree Solutions
First-class money management package includes MT4 PAMM, MT5 PAMM, Social Trading Software for MT4/MT5, Ratings and Statistics Module and many other tools that can be hand-picked by a broker to organize their own money management system and to automate and empower their business.
In celebration of Brokeree Solutions 5th anniversary, we announced a special offer for product packages. Request more information about the packages, or the special offer via email@example.com
Money management services have always had their market share, which was growing, shrinking and expanding throughout the history. Diversifying an offering a forex brokerage can get access to a new market niche, thus attracting new clients.
The differences in technology and money management systems require prior analysis and research of your needs, needs of your current customers and needs of potential clients that you are planning to attract. MAM is suitable for more riskful traders, whereas PAMM provides a secure and transparent system for newcoming investors.
Digital marketing channels provide forex brokers with all the tools they might dream of when it comes to reaching, attracting, converting and tracking their potential clients.
Are you a marketing manager in a forex brokerage? Let’s connect and find new ways of promoting your brokerage services.
Anton Sokolov – Digital Marketing Manager at Brokeree Solutions
If you would like to learn more about the differences in money management systems, we suggest reading the “PAMM, LAMM, MAM….Are You Confused?” article by Finance Magnates, “Differences Between MAM And PAMM Accounts” by The FX View and “The difference between MAM and PAMM managed accounts” by Forex Central.