Communication: An underrated success factor when reaching your investors
Two things are beyond important when money is part of the transaction: transparency and trust. How to ensure them? As with any relationship, open communication is the essential first step in that direction. Here is how you can learn from leading experts in the financial industry who have managed to build rock-solid performance by taking advantage of a strong communication strategy to reach key investors and make their access to quality content easier.
Coherra is working with more and more asset managers who benefit from becoming great communicators. How can you use this strategy as well?
Share your research — it is your most important asset. Open access to information and knowledge of how they can benefit from coming changes is what investors need most.
Understand the currency of power — not money and performance, but research and social influence create your credibility.
Distribute your content — only then can you grow your investor audience exponentially and reach them where they are.
The financial industry is changing but altering the status quo does not happen overnight. Swaying more people into following the innovators and adopting the disruption into their usual practices is not instant.
In fact, the financial industry might just be more stubborn than other sectors. The requirements of the past year have made the commitment to digital communication stronger. It has forced asset managers to find more innovative ways to connect with their clients/investors than through an in-person individual meeting. How the industry communicates has shifted under the coronavirus pressure. Let’s change what and where is communicated.
Ark Invest: How a financial industry pioneer took advantage of social media mechanisms
Transparency is very much investor-friendly. It brings about what they need above all else: access to information and education on what changes are coming about, and how they can leverage them.
A financial expert that can confirm the benefits of an open communication strategy is Cathie Wood. Since 2014, her company Ark Invest has made its mark especially in two areas: investing in disruptive technology and what they use their communication for. Sharing research, educating investors about innovations, and being as much of a thought leader as they get.
In a recent interview, Cathie stressed the importance of social media which has given her company a competitive edge. Without any doubt, it helped them leap from 6.6 bln AUM at the beginning of 2019 to a staggering $50 bln AUM at the close of 2020.
This is how asset managers can communicate in today’s world. Digital channels and social media have become a necessity in recent year. While few do it with such success as Ark and its founder, a good social media presence is no longer a novelty.
Where Ark is truly pioneering is what and where gets communicated.
They are making their extensive research library available for investors anywhere one can think of. Social media channels, podcasts, webinars, media appearances… This multi-channel strategy is giving their brand exposure. But the bulk of their communication is almost never focused on Ark. Instead, it focuses on the research they conduct and insights into disruptive markets they produce.
This brings them an advantage. According to Cathie, sharing research on social media not only increases their reach but also allows them to become a part of the communities they research. It brings about a give-and-take type of dialogue. Ark gets feedback on their theses and findings from the very innovators whose field they are researching in exchange for educating them on the state and future of their sectors.
Research: The main asset financial experts have
Coherra sees a trend that is displacing the traditional keep-it-under-wraps, talk-only-about-performance attitude. A trend based on crucial open communication. And Ark Invest is taking the lead.
The strategy and approach to the market vary from asset manager to asset manager. But for an investor, it may be a challenge to choose one they trust with their money if they are going into the choice blind and deaf. There is a lack of obvious advantages — contrary to the retail sector, an asset manager will not be able to offer investors stocks with 50% off.
The primary asset financial experts have in the industry is their research — and the way they choose to wield it.
When openly shared, research establishes asset managers as thought leaders and authority in their sector. Content means conviction. The more quality content asset managers produce and share, the more likely will they be to convince new investors to side with them and keep the trust of existing ones.
There is nothing to lose when sharing good content, and everything to gain.
Money is no longer the true power — research and influence is
Our network, while important, cannot be the end venue for all the learnings we accumulate and the intelligence we share. Educating your network is important — but why share what you know only with a fraction of the audience that should know it, too?
Quality content is the basis, but it would be only slightly effective without the right distribution. Cathie Wood said that if she were to do something differently, she would have had distribution partners sooner.
That is a stark contrast to the present day. When Ark has hundreds of thousands of direct followers and subscribers across all social media platforms. When the content they create and share reaches millions in the investor audience.
This is a statement to the current power balance in the industry. It is not money that gives you power and credibility. It is the research you share and the social influence you gain when you communicate.
With the combination of their open research and influencer standing, it is no wonder that during the 2020 Battery Day, Ark Invest had four experts debating the developments on four different news stations. That is how big of a thought leader they became with this powerful combination.
Only distribution into the right audience and through the right partners can bring about the end goal — value for both investors and asset managers.
For asset managers, the value of distribution lies in the extended reach. The number of investors who see their content when they put it onto their own website is low. Numbers that see the content when it is out on social media are higher and tend to grow, allowing them to wield significant social influence.
The number of investors reached when distributing onto different channels and platforms? Growing exponentially.
For investors, this automatically means their life gets easier. They can have the most relevant and personalized choice of content delivered into the place where they operate most often. No need to search for it or keep track of all the individual pages and profiles it is stored on. Less time spent on searching, more time spent on watching, learning, and connecting.
While choosing where to invest their money, people never only pick a fund; they buy the fund manager as well. Maybe because of their expertise in the sector. Maybe because of their innovative strategies.
Pioneers such as Cathie Wood know the wonders an active, influencer-like communication strategy and open sharing of research can do to establish them as thought leaders.
Coherra is proud to be working with more and more such asset managers. We know that committed pioneers are needed. Not only because it gives them the competitive edge but because the more of them there are, the closer we are to realizing our vision for the future of asset management communication.
Open, relevant, and accessible wherever investors need.