3. How was the research conducted? What did we find?
nightingale commissioned Colmar Brunton to conduct an online One of the interesting aspects of the research is that a very low
survey using their Investor Pulse panel which comprises more 5% of retail investors said they rely on financial planners or
than 4,000 retail investors residing in Australia who own shares brokers when making investment decisions, preferring to back
in ASX 100 companies. their own judgement, or advice from friends, family or the media.
___
___ For these investors, faced with a plethora of information
All respondents were shareholders in a listed company, or sources, the research shows that nothing beats information
owned equities indirectly through an investment fund, and had straight from the horse’s mouth. Investors place a high value on
bought or sold stocks or shares in the last 6 months. traditional company-generated information sources, with the
company website widely considered to be the most useful
In total, 507 retail investors completed the survey. Charts are medium for accessing company news and information. Perhaps
based on all 507 responses except where stated. surprisingly in today’s world where published content quickly
becomes out of date, 41% of retail investors continue to place a
Data was collected between 3 October and 6 December, 2012. high value on annual reports as a source of information.
Around 25% of investors said they place a high level of reliance
on business media when making investment decisions, with
over a third saying that the online format has become more
important to them in the last year. Paid for subscription services
were also popular amongst those surveyed.
In terms of social media, investors interviewed appear to be
quite engaged online and in digital formats with 61% saying
they buy and sell shares via online trading platforms, and 28%
saying they contribute content and comments in social media
and online platforms.
That said, social media channels are currently viewed as less
influential than traditional media channels in the context of
decision-making, and investors expressed a lower reliance on
those channels compared to others.
With over 10% of retail investors saying they place a high
reliance on social media channels like micro blogging services
and social networking sites, it will be interesting to see if social
media channels become more important in the future.
2 nightingale communications 3
4. Research findings Reliance on information sources
Retail investors rely on a broad mix of information sources.
___
Information direct from companies is the most important, but
around a quarter of retail investors are highly reliant on digital
channels such as online investment subscription services and
online business media.
Investors are less reliant on social media relative to other
sources of information, however over 10% of retail investors
place a high reliance on social media channels like micro
blogging services and social networking sites.
Information sources investors place a high reliance on (rating of 8 –10 out of 10)
40%
30%
30% 28% 28%
27%
26% 26%
20%
16%
13%
11% 11%
10%
0%
Information Business media Subscription Real time Business media Online Internet forums Social Micro-blogging Blogs
direct from print newsletters subscription online investment or message networking sites services
companies services advice boards
subscription
services
Q. Here is a list of sources which you might use for information about business or companies.
a scale of 1-10, please tell me how reliant you are on each source, where 1 = not at all reliant and 10 = highly reliant.
On
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5. Influence on investment decisions Importance of paid for digital information
Information direct from companies ranked the highest in influencing Retail investors are using a mix of paid for digital media
investment decisions. channels, including subscription services, which have all grown in
importance in the last year.
___
Business media, both print and online, were the next most influential
___
information sources. Over a third of retail investors say that online business media
has become more important.
While social media such as internet forums, blogs, social networking sites
and micro-blogging services were not ranked as highly as other sources,
12% – 15% of investors rate these sources as being highly influential.
Information services which have a high level of influence on investors (rating of 8 –10 out of 10) Increased importance of digital information sources over the last year
50% 40%
36%
33%
40% 29%
30%
28%
31%
30%
25% 25%
23% 23% 20%
21%
20% 14%
15%
13% 12% 12%
10%
10%
7% 7%
10%
3%
0%
0%
Business media Subscription Real time Online investment Internet forums or Blogs Social networking Micro-blogging Other digital media
Information Business Business Real time Subscription Online Internet forums Blogs Micro-blogging Social online newsletters subscription advice subscription message boards sites services
direct from media print media online subscription newsletters investment or message services networking services services
companies services advice boards sites
subscription
services
Q. Thinking about the same information sources, to what extent do they influence your investment decisions Q. Which, if any, of the following digital information sources have become more important in the last year?
recommendations, where 1 = no influence and 10=highly influential.
or
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6. Business media in print and online is Engagement in social and digital media
highly influential and online business media
is growing in importance
25% of respondents said business media in both print and online 18% of retail investors plan to use social and digital media
formats is highly influential when making investment decisions. more over the next year, while 9% plan to use it less.
___ 20%
26% of respondents said they place a high reliance on print business Q. How is your use of social or digital media for work
likely to change over the next year? Are you likely
media and 28% said they place a high reliance on online business media. 15%
to use it more, less or the same?
10%
Use
Online business media has become more important for 36% of more
5%
respondents over the last 12 months. 18%
0%
Use less
-5% 9%
-10%
-15%
-20%
Reliance, influence and growing importance (rating 8 –10 out of 10)
28% of retail investors contribute online content, either as
authors or contributors. Blogs, forums and message boards
are the most common platforms.
50%
Business Media – Business Media -
Print Online
40%
36%
Q. Do you post to or contribute information on
30% 28%
25% 26% 25%
companies or business to any of the following?
Contribute
28%
20%
Forums 66%
10% Social 36%
Do not contribute networking
72% sites
0%
Blogs 32%
Influence Reliance Influence Reliance Increased importance
in last 12 months
Micro-blogs 19%
e.g. Twitter
8 nightingale communications 9
7. Benefits of social media Email and company websites considered
the most useful information sources
54% of of retail investors consider that social media delivers no Retail investors consider the company website to be the most useful
real benefits for investors. source for accessing company news or information.
___ ___
Among those who could identify a benefit, getting regular Three in ten retail investors also consider email to be very useful.
updates on investments and having access to the opinions of A smaller proportion, although more than 10%, consider digital channels
experts were the main benefits identified. such as company videos, Twitter, and Facebook to be very useful.
Benefits of social media for investors Information channels identified as “very useful”
I get regularly updated with key Q. What, if any, are the benefits of social media 45%
communications relating to my 22% to you as an investor? 42%
investments
40%
I get access to the opinions of experts 19%
35%
I can connect with other investors and
19%
share experiences and opinions
30% 29%
I get the inside track about a company’s
17%
performance and investment potential
25%
I get a better investment return 5%
20%
No real benefits 54%
15%
15%
12%
0% 10% 20% 30% 40% 50% 60% 11%
10%
5%
Main single benefit of social media
0%
Q. Which benefit do you value the most?
I get regularly updated with key Company Email Company video Company Company Twitter
communications relating to my 34% website content (e.g. Facebook page account
investments YouTube)
I get access to the opinions of experts 24%
Q. Below is a list of channels which you might use for accessing market sensitive company news or information.
I get the inside track about a company’s
performance and investment potential
20% Please rate how useful these are – either very useful, fairly useful, not useful.
I can connect with other investors and
17%
share experiences and opinions
I get a better investment return 4%
0% 10% 20% 30% 40%
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8. Value of information direct from companies Australian companies use of social and
digital media in investor communications
When it comes to information provided directly by companies, retail About a quarter of retail investors give Australian companies a score of
investors see most value in traditional sources such as company annual eight or more out of 10 on their use of social and digital media.
reports, ASX filings and press releases.
___ ___
Relatively lower value is placed on video content and company digital The majority rate Australian companies as average to good,
media channels such as Twitter, LinkedIn, YouTube or Facebook, although which suggests there is significant room for improvement.
15% of investors said they thought these channels were very valuable.
Over half of the investors could not name any companies which
make the best use of social and digital media in their investor
communications.
those who did, BHP, Telstra and CBA were the most
Of
commonly cited.
Information direct from companies that investors place a high value on (rating 8 –10 out of 10) Rating of Australian companies use of social and digital media in investor communications
45%
41% Q. On a scale of 1-10 where 1 is poor and 10
40% 38% is excellent, how would you rate Australian
35% companies in their use of social and digital
32% Excellent 27%
30% (8-10 out of ten) media in their investor communications?
30%
25% NB: The chart excludes those who responded
‘don’t know’ to this question and includes
20%
15% 15% responses from 417 investors.
15%
Average to good 56%
10% (5-7 out of ten)
5%
0%
Annual reports ASX filings Company press releases Company website Company social media channels Video content
Poor 18%
(1-4 out of ten)
Q. In terms of information direct from companies, please rate the following information sources in terms of their value to you,
0% 10% 20% 30% 40% 50% 60%
where 1 = no value and 10 = high value.
12 nightingale communications 13
9. Comparison with overseas companies Influences on investment decisions
A large proportion of Australian retail investors lack awareness of how Retail investors are split into two distinct groups regarding
overseas companies use social and digital media in investor communication. influence on investment decisions: 54% are largely reliant on
themselves, 46% are largely reliant on other people.
___
47% stated that they were unable to compare Australian
___
companies with overseas companies. Of those relying mainly on others, the most commonly
mentioned external influences include investment commentators
those who had an opinion, just over a quarter thought
Of and experts, friends and relatives.
Australian companies performed better, and just under a fifth
said they performed worse. A very small 5% of investors rely on investment professionals
when making investment decisions.
Comparison of Australian companies to overseas companies in digital investor communications How investment decisions are made
I rely on myself and don’t trust
Australian companies perform 54%
27% anybody else
better than overseas companies
I rely on the investment tips from
from commentators, experts or 21%
spokespeople on TV/radio/internet
Australian companies are on a
55%
par with overseas companies
I rely on my friends, relatives and
colleagues for advice when making 20%
investments
Australian companies perform
18%
worse than overseas companies I largely rely on my financial planner
5%
or broker in my investment decisions
0% 20% 40% 60% 80% 0% 10% 20% 30% 40% 50% 60%
Q. How do Australian companies compare to overseas companies in their use of social and digital media in their Q. Which of the following best describes how you make your investment decisions?
investor communications?
NB: The chart excludes those who responded ‘don’t know’ to this question and includes responses from 271 investors.
14 nightingale communications 15
10. Platforms used to buy stocks and shares Profile of survey participants
63% of investors surveyed trade in equities via an online trading
platform, indicating a high level of comfort among the surveyed group
with using the online medium.
___
Stockbrokers, financial advisors and accountants are much less
popular platforms to buy and sell shares.
Methods used to buy stocks and shares
Directly via an online
63%
trading platform
Through my financial/
22%
investment adviser
Directly via a full
18%
service stockbroker
Through my
12%
accountant
0% 10% 20% 30% 40% 50% 60% 70%
Q. Which of the following do you use to buy and/or sell stocks and shares?
16 17
11. Share trading profile Income profile
___ ___
All of the 507 retail investors had traded shares in the past 6 months. 34% of respondents had incomes of more than $104,000 per annum.
Of those interviewed, one in five had traded shares in the last week, and
half had traded in the last month.
Among those who estimated how much their share holdings were worth, the
average value was $420,000.
Frequency of share trading Household income
$7,800-$12,999 per year 1%
In the last week 25% $13,000-$20,799 per year 2%
$20,800-$31,199 per year 3%
In the last month, $31,200-$41,599 per year 5%
but more than 32%
a week ago
$41,600-$51,999 per year 9%
$52,000-$67,599 per year 10%
In the last 6 months,
but more than a 43%
month ago $67,600-$83,199 per year 13%
$83,200-$103,999 per year 15%
$104,000 or more per year 34%
Refused 9%
Age and gender profile 0% 5% 10% 15% 20% 25% 30% 35% 40%
___
Two thirds of retail investors in the sample were aged 40 years and over.
64% of the investors were male, 36% were female.
18 nightingale communications 19
12. About nightingale
nightingale is a specialist financial and corporate communications
consultancy focused on helping companies to navigate issues or events
that could impact their corporate reputation or share price.
___
Our expertise includes:
– transaction communications
– investor relations
– media relations
– issues management, crisis communication and litigation support
– corporate positioning and reputation management
– strategic internal communication
– distressed situations including receiverships and administrations
Our team of advisers are financially literate with backgrounds in
accounting, finance, law and financial journalism. Together, we have
more than 40 years experience, and an international perspective
gained through working in blue chip companies and some of the
most successful communications consultancies in Europe, the US
and Australia.
www.nightingalecommunications.com.au
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