Digital now rivals traditional media as driver of major investment decisions

New research into how investors use digital media reveals that it now rivals traditional media as a driver of investment decisions. The new data from the latest Brunswick Investment Survey shows that 90% of investors regularly use digital platforms and channels to research companies and issues, with 70% saying they make investment decisions on the basis of something they learned from digital research.

As someone who specialises in digital corporate communications and public affairs this confirms what I’ve been seeing and arguing for a long time. Consumer PR and marketing people have long since grasped the importance of digital and social media, yet too often corporate affairs professionals lag behind. In corporate affairs, investor relations and public affairs personal relationships matter a lot. Relationships with individuals and with a small group of elite media titles. But the new Brunswick research confirms so does digital.

Search remains the most important digital tool for corporate communications professionals. Search engines are the most trusted digital platform (this is something that has also been shown in the Edelman Trust Barometer). The leading digital sources for investors are search engines and blogs with 70% using search engines as a source and 67% using blogs, leading to 48% making investment decisions based on search engine research and 42% based on blog research.

It’s even more interesting to delve into how digital media is used by investors and analysts. The most frequent use is “to learn more about a specific industry or sector”, which is above “to keep up with a particular company that I follow”. This indicates that the value of ‘content marketing’ for corporate communications as investors and analysts want to learn about the sector or issue more than they want the company to talk about itself. It also points to the value of curation of valuable third party content and making informed comment about it.

The trusted digital media sources question is the one that reveals that the highest ‘net trust’ scores are for search engines (+50), LinkedIn (+26) and blogs (+21). Surprisingly LinkedIn-owned SlideShare has a ‘net trust’ of –5. YouTube has a massive –32 ‘net trust’ rating, but I wonder if this is because respondents to the survey mainly associate it with with viral consumer videos and popular consumer ‘vloggers’ and there is so little quality corporate content to see? Not surprisingly Facebook is the least trusted digital media source (-50), even before the Cambridge Analytica story blow up. ‘Net trust’ is calculated on the difference between the level of trust and distrust in a platform.

The survey also asked about trust in mainstream media sources where Bloomberg Terminals (+86) and Bloomberg Businessweek (+79) had the highest levels of trust. However, The New York Times and CNBC both had comparable levels of trust to search engines and LinkedIn. Fox Business News scored –17, which is the same as Twitter.

It is important to understand that just because some platforms have a negative ‘net trust’ rating it doesn’t mean they should be avoided. Twitter gets a –17 because 47% of respondents don’t trust it, but that still means 30% do trust it and 42% of them regularly rely on Twitter to for information.

The research (and the previous findings) indicate lots of opportunity for corporate communications:

  • Digital media use has plateaued – this might sound negative, but is actually positive. It means digital is no longer the ‘shiny new thing’ sitting at the ‘peak of inflated expectations’ on Gartner’s Hype Cycle, but instead is now on the ‘plateau of productivity’. The conservative, risk-averse C-suite no longer need to be afraid and corporate communications professionals should be encouraging them to embrace it.
  • LinkedIn should not be in the hands of human resources – it’s a powerful corporate communications platform, if you used correctly. And therein lies the conundrum. LinkedIn a personal social media platform for business. That means a C-suite executive can’t just ‘outsource’ their LinkedIn profile to their PR person. It has to be personal. But this needs careful planning and expertise to implement.
  • Blogs – aren’t dead, just like press releases aren’t. And it’s unlikely either ever will be. What companies need to do is modernise and innovate how they use them. The research didn’t ask about podcasts, which are enjoying a renaissance at the moment.
  • Content marketing – isn’t just for consumer and business to business campaigns. Used intelligently it’s just as applicable to corporate communications and investor relations. This means identifying sources and influencers; monitoring and curating third party content; creating and sharing good content that embraces Tom Foremski’s ‘Every Company Is A Media Company’ concept.
  • Shiny new things – still have a place, but only if used professionally to achieve measurable objectives. That’s why augmented reality, virtual reality, drones, artificial intelligence etc all potentially have a role.
  • Paid – the research didn’t look at perceptions of paid social media, but there is lots of potential to carefully targeted LinkedIn and Twitter advertising, which doesn’t require a huge spend.
  • Twitter and YouTube

To research the data Brunswick surveyed 150 buy-side investors and sell-side analysts to understand how investors use digital media platforms to research and make investment decisions. It was gathered in November and December 2017 from across the UK, Europe, North America and Asia. Similar surveys were carried out in 2015 and 2016. All data and graphs from Brunswick Group Investment Survey which can be viewed on SlideShare.

To find out more about how digital and social media can be used safely (complying with local laws, regulations and codes of conduct) for corporate communications and public affairs then get in touch.