Because TDFs are relatively simple, offering "a one-stop investment solution," and because most participants don't take a hands-on approach to their plan investments, TDFs offer "an ideal investment for DC plans," Cerulli said.

Auto-enrollment and auto-escalation will further push assets into TDFs, it said. 

"The market for target-date funds is highly competitive given the industry's expectations for future flows, and we anticipate that competition will intensify," Jessica Sclafani, senior analyst at Cerulli, said, adding:

"Asset managers that do not have a proprietary target-date product will be forced to re-evaluate their DC strategy, as the assets that are expected to amass in target-date strategies over the next several years cannot be ignored." 

Cerulli also said in its report that 403(b) plans will increasingly become "more 401(k)-like," and that the 403(b) market will "appreciate at a slightly higher pace than its 401(k) counterpart over the next five years." 

Other points raised in the report include an increase in plan sponsor concerns over fiduciary liability, to the extent that some are hiring two separate advisors for their plans — one for investments and one solely for fiduciary liability — so that they can lessen their perceived increasing liability as a result of increased regulatory attention. 

And then there's concern over risk.

According to the report, "Cerulli believes that as corporate DB plan sponsors identify entry points for implementing de-risking strategies, opportunities for experienced fixed-income managers to secure new mandates will unfold.

"Asset managers that have not done so already should invest in their fixed-income capabilities and seek to bring de-risking experts or specialists in-house to support client conversations. The firms that can position themselves as knowledgeable and consultative in constructing a dynamic de-risking glide-path will benefit," it said.