A Look at the Rise of Robinhood Investors: What Does It Mean for Investor Marketing?
There hasn’t been as much disruption in the retail market since the SEC deregulated discount brokerages in 1975. The power of Robinhood’s democratized finance has been unleashed:
- Robinhood has added more than 3 million accounts since January– a 30% rise.
- 2020 revenue is expected to hit $700 million, a 250% increase from 2019.
- Robinhood traders are moving markets: some stocks and options are even more volatile and single-stock option-trading volumes surged an unprecedented 129% this year.
The discount brokerages (Charles Schwab $SCHW, TD Ameritrade $AMTD, E-Trade $ETFC etc.) are also seeing unprecedented daily average revenue trades and new accounts. What does this mean for investor marketing and relations?
An Untapped Investor Target Market
Shifting consumer spending means that anyone can invest. Shifting investor behaviour means that money is flowing out of aging traditional brokers and into the hands of empowered young investors.
“Typically when a market crash is followed by a recession, retail investors pull out. Institutions benefit. . . In this case [the COVID-19 pandemic], Robinhood customers started opening new accounts and existing customers started putting in new money. This bodes positively for society and our economy if millions are investing when they otherwise wouldn’t have.” Co-founder Vladimir Tenev said for Forbes.
This creates an untapped investor target market for investor relations professionals. A niche that has yet to be fully explored and adopted into most IR strategies.
The Digital Investor Ecosystem
A whole new investor target market that consumes its information online has created a digital investor ecosystem. Investors in the digital age are educating themselves online through financial publications. Listening to experts in private and closed online investing and trading social media groups and financial forums. Traditional IR tactics don’t necessarily work for this demographic.
How to Reach this Untapped Investor Target Market?
Typically, an investor relations strategy consists of sales and communications professionals targeting institutional investors and brokers. The largest issuers might also have PR teams with no tangible ROI. Very rarely do issuers have digital marketers to promote the company as an investment. This can create confusion to who covers what as seen in Who’s on First- A Guide to Investor Marketing and Communications Roles. Investor marketing firms such as Plexus Media are here to complement IR and PR teams.
Plexus Media was founded in 2016 to reach the retail investor through innovative digital tactics. All of our programs are designed with the end investor in mind. Our Thrive lead generation program uses digital marketing to attract retail investors interested in your offering. The Spectrum network and proprietary technology has relationships with 340+ online investing and trading groups, financial forums, and influencers. Chatter allows you to monitor investor sentiment and control the narrative of what investors are saying about your company.
It doesn’t stop there. Contact one of our digital marketing experts to see which one of our digital tactics can help you reach an untapped market of investor – 1-844-6PLEXUS ext. 108