After focusing its efforts on building its corporate identity, Affinity Investments, a two-year-old Toronto-based mutual fund dealer, launched a major direct marketing campaign last month to promote its no-commission brokerage services to a growing base of investors throughout Ontario.

Representing 18 mutual fund families, including Trimark, Altamira and Scudder, through a product called FundSource, Affinity is, in effect, a one-stop shop for mutual funds.

In an attempt to help its clients pick the best funds for their needs, the company also produces a quarterly ‘select list’, which highlights anywhere from 30 to 50 of the more than 500 funds that are available through the FundSource program.

The company, which operates exclusively through direct response marketing channels, makes its money through the fees that fund companies pay to brokers who carry their products.

Targeting a segment of the investor market – late-stage baby boomers between the ages of 25 and 40 – usually ignored by older, more established mutual fund dealers, Affinity has formed exclusive marketing arrangements with alumni associations from some of the biggest universities in Ontario, including University of Toronto, York University and Ryerson Polytechnical University in Toronto, and Queen’s University in Kingston.

According to company President David Finley, Affinity is getting set to enter a period of rapid expansion that will see it establish new affinity relationships with a range of groups that could include more universities, a credit union, some professional associations, and even a major credit card company.

‘We want to use their databases as our vehicle to get to consumers,’ says Finley.

‘In the business of affinity,’ he explains, ‘the simple thing to understand is that databases are extremely different in the kind of content they have in them. Some are very good, and being able to exploit one in a better way than you can another is a huge competitive advantage.’

Finley, who agrees that his company’s marketing strategy is similar to that of insurance marketer Meloche Monnex, says he expects his company to increase the size of its customer base to 25,000 from only about 3,000 over the course of the next two years through the use of direct mail, print advertising in selected alumni magazines, and Internet marketing via a Web site that was launched late last month.

The company, which is spending one million dollars this year in an attempt to build FundSource into a viable brand, does all its strategic planning in-house. It is working with an agency called Sonar on creative executions for its advertising and direct mail promotions, including a 106,000-piece campaign that rolled out last month.

‘This year, it’s all response driven,’ says Finley of his company’s marketing investment, which includes a 20-person call centre staffed by licensed investment advisors.

‘The first two years had been kind of a feeling-out period for us,’ he says. ‘Now, we’re signing on customers who we know we’ll be doing business with for a long time. This is our real growing up year.