04/02/2025
I should be so lucky you might think, but the reference to R&R in this case, alas, does not mean rest and relaxation….in fact, far from it, read on…
Research in Finance recently asked investors participating in their Communications Compass online community what information sources they use whilst on their investment journey and were struck by the responses…alongside such staples as investment platforms and accounts, research providers, financial press and google, there comes significant interest in Facebook groups, youtubers, podcasts and bloggers Of interest is not only the frequency with which these sources are being mentioned but the value and esteem that is attributed towards them.
‘The Monevator blog – I use their broker fees table, general investment strategies, latest research and overall it is a really good community of largely retail investors seeking financial independence. Also of tremendous value is the Morningstar Long View podcast, where they interview lots of people in the themes of investing, happiness and retirement. I also very much like Meaningful Money and Maven Money podcasts, these offer more general educational material and are a good nudge in the right direction.’ Confident Investor, 36-55 (Jan ’25)
‘I follow one investment-related blog – ‘Moneytothemasses’. I find the editor Damian to be very knowledgeable and explains things in a simple manner. I really use his insights to understand the market outlook and emerging themes on the horizon. I digest the content on my phone through the ‘Feedly’ app which basically pulls together articles from websites you choose for you to read. I normally spend some time in the morning reading the blog.’ Confident Investor, 36-55 (Jan ’25)
What is the draw?
A driving factor behind this sentiment is a sense of resonance or connection with the presenters or with the goals and aspirations of fellow investors or contributors within the groups – of shared experiences (both good and bad) and stories told, ‘real life’ scenarios described and explained by people ‘just like them’ with little or no perceived agenda. It seems that here are the grass roots of learning more about investing, investment strategy and gaining confidence in understanding from people willing to share both successes and mistakes.
‘The Donegans from Rebel Finance School. They share everything, from the funds they pick to how their portfolio is doing, which helps me to feel that it is an achievable goal for me. They have a blog and a short finance course which is available to anybody ( however they are not finance professionals, it is all from their own experience and learnings). I only discovered them in the last 2 years and feel that they have made the goal more attainable.’ Confident Investor, <35 (Jan ’25)
‘I rely on people who are speaking from experience for my information. As previously mentioned I listen to the Donegans from the ‘Rebel finance school’. I trust them because they are open and honest about their experiences. They are speaking from experience and share their investments on their blog. I also trust ‘Damien talks money’ and ‘Mama fur fur’ because they are also knowledgeable about the subject of finance.’ Confident Investor <35 (Jan ’25)
‘I really like social media during the week – I feel like I can get lots of information quickly whilst being entertained by it – TikTok, YouTube are really good – I look for inspiration around potential new investment ideas – also it helps to consolidate my knowledge and thoughts on investments that I have already.’ Less Confident Investor, 36-55 (Jan ’25)
Although these formats allow for a different approach and style of narrative, for a different look and feel which is more informal, talkative, relaxed or even a little irreverent in places, the premise of ‘real people’, giving real examples underpins them. It is inviting, inclusive and it feels relatable – being ‘real and relatable’ is the R&R which can make a fundamental difference.
How can R&R transition across to help achieve consumer duty goals?
Now for some numbers…in a review of 84 assorted investment materials tested through Research in Finance’s Communications Compass service, 40%* were not reaching their optimal potential, with information feeling inaccessible to investors. Moreover, across the same 84 materials, 35%** were not capitalising on clarity of information, resulting in it feeling harder to engage with the product. Investors explain that one reason they are not able to relate to the information is because of how it is presented and another is that they are unable to relate the information to their own investments… often leaving them scratching their heads and asking ‘but what does this mean for me?’
‘The graphs and charts do not work for me, a lot of information but I don’t know what relevance or meaning it has. The only part that works is the allocation summary yet again, still doesn’t explain the benefit of this and what it means for my investment.’ Less Confident Investor, 36-55 (May 24)
‘No idea what I’m supposed to take away from this page other than very high-level summary of how the funds work. All the subsequent details seem largely pointless as the language is so dense and technical that I struggle to understand. Most of the detail also just refers the reader on to various appendices and other sections, so it feels pretty redundant.’ Confident Investor, <35 (July ’24)
‘I thought there might have been a couple of examples of someone’s pension journey […] It would have been useful to see it illustrated with some real-world examples so you can visualise your own potential journey.’ Confident Investor, 36-55 (Dec ’24)
‘Case studies on different investment strategies (or fictional user stories) may be useful to contextualise this information. It would also be useful to compare the current economic climate with historical economic climates, as this would provide more context on why this current point in time is so beneficial for long-term investors.’ Less Confident Investor <35 (Aug ’24)
The fundamental difference comes from applying R&R and helping investors along a little with examples, with ‘real-life scenarios’ or relatable illustrations that help to contextualise whatever needs to be imparted. Also interesting is that of the same 84 investment communication materials tested, 73%*** were actually above the average in terms of clarity, but when engagement and accessibility are lacking, the perceived value of the material diminishes, with investors often no further forward in relation to both understanding and any potential impact or implications for their investments.
The quickest route to improving relatability and giving an injection of reality?
Some common requests from investors to increase R&R include:
Sadly I don’t need to tell you this, but there is no single ‘golden rule’ when it comes to investor communications. No magic formula or algorithm due to the huge amount of nuance between both the subject matter and the consumer. The challenge is significant for anyone grappling with consumer duty compliance amidst the myriad of rules and regulatory requirements, but where possible, keeping it ‘real and relatable’, adding a little R&R, can go a long way to reducing barriers, increasing understanding and ultimately improving the consumer experience and journey. Getting it right can make all the difference:
‘Easy to read, avoids jargon as much as possible, well designed, well structured, interesting, friendly, approachable. I really like this document. I think the design has been well thought out and I appreciate that the structure ensures that you’re leading the consumer by the hand through the topic. It feels modern and slick which again comes down to the design and I appreciate that the photos make you feel like this document is for everyone and not a ‘specific type of investor’.’ Less Confident Investor, <35, (July 24)
‘This is probably the best and most informative document I have read in this sphere and one that I would print out and keep! I understood it all and it was pitched correctly.’ Less Confident Investor, 36-55 (July ’24)
‘The mix of photos, text and graphics is really good and adds balance. I was impressed from the get-go (cover page) and continued to be impressed throughout. The illustrative graphics are all great and work well to complement the text.’ Less Confident Investor, <35 (July ’24)
Method
84 materials tested since July ‘23
All materials rated on a scale of 1-10 where 1 is lowest and 10 is highest for clarity, accessibility, usefulness and engagement.
*40% of materials where accessibility scores are less than the average disparity shown between accessibility and clarity measures.
** 35% of materials where engagement scores are less than the average disparity shown between engagement and clarity measures.
*** 73% of materials score above the average of 6.9 out of 10 for clarity