Estimated reading time: 4 minutes
This article includes insights from Auddy’s recent webinar with the London Stock Exchange, InvestorHub, and Conran Design, titled “Does the Market Understand Your Business?” which you can watch here.
Why the “IR Triangle” Has Shifted, and How to Bridge the Gap Between Disclosure and True Comprehension
For many public companies, there is a frustrating disconnect between the quality of their operations and the movement of their share price. Management teams often conclude that the “market just doesn’t get it.”
But in an era where the average adult attention span has plummeted to about three seconds, the burden of understanding no longer rests with the investor… it rests with the communicator.
The way investors consume information has undergone a seismic shift. If your Investor Relations (IR) strategy looks the same as it did in 2021, you aren’t just behind the curve; you are likely invisible to a significant portion of your potential capital base.
The Death of “Spray and Pray”: The New IR Triangle
Historically, IR professionals operated within a trade-off triangle consisting of Distribution, Frequency, and Impact, said Alex Stella of InvestorHub. Five years ago, the primary battleground was distribution. Reaching a wide audience was expensive and required gatekeepers, third-party analysts, and heavy advertising spend.
Today, distribution is effectively “solved.” A modest budget and a targeted LinkedIn campaign can put a CEO’s face in front of almost any specific demographic.
The Auddy team agrees – the new battleground has moved to Frequency and Impact.
It is no longer enough to “reach” an investor once a quarter. To be understood, you must provide a consistent narrative that cuts through the noise.
The market has moved away from 50-page research reports toward short-form, high-impact content. If you cannot explain your value proposition before the three-second window closes, the investor has already scrolled past.
Meeting the Investor Where They Are
One of the most significant changes in the last five years is the breakdown of the “professional/personal” divide in content consumption. The image of an institutional investor sitting at a Bloomberg terminal for ten hours a day, meticulously reading every page of an annual report, is increasingly antiquated.
Andrew Craissati, CEO of Auddy, highlights that the investment community’s behavior now mirrors general consumer behavior.
“Traditionally in the old days, an institutional investor was consuming content in the workplace at their desk. They were setting aside time to read documents to evaluate and run their models,” Craissati explains. “Today, they want that content to come to them wherever they are, whatever time of day it may be. So now they’re on the go, they’re in the gym, they’re driving their car, they’re walking the dog.”
This fragmentation of the working day means that IR content must be asynchronous and mobile-first. If your primary method of communication is a mid-Tuesday webinar that isn’t easily digestible later via audio or short-form video, you are ignoring the reality of the modern workday.
The Rise of the Retail Persona
The democratization of trading has elevated the retail investor from a “secondary thought” to a primary market force. This isn’t just a trend for “meme stocks”; it is a fundamental shift in how liquidity is maintained.
“The retail investor is far more important today than they were those years ago where they were considered a second-hand thought, a secondary buyer,” says Craissati. “With entrepreneurs like Elon Musk who are advocating almost exclusively retail strategies, that retail persona is now a very important person that has to be addressed.”
Addressing this persona requires a departure from “corporate-speak.” Retail investors, and increasingly institutional ones, crave context. They want to see the “soul” of the business—the people on the ground, the country heads, and the division leads—rather than just the polished, rehearsed delivery of the C-suite.
From “Reporting” to “Content Extraction”
The traditional annual report is often a graveyard of good information. It is a compliance document that few people read in its entirety. To ensure the market understands your business, you must move toward a strategy of extraction.
This involves taking the “marketing” elements of your financial results and repurposing them into different formats:
- Audio/Podcasts: For the investor walking the dog, at the gym, commuting, or between meetings.
- Short-form Video: For the investor on LinkedIn.
- Interactive Graphics: For the investor who needs to see the “why” behind the numbers.
As Craissati points out, the delivery mechanism is just as vital as the message itself:
“The consumption of content is now in a much shorter form than it was previously. But it also needs to be delivered in a mechanism that is entirely flexible, so that it meets the needs of the investor wherever they are and whenever they are and with whatever device.”
IR as a Marketing Function
The future of Investor Relations looks less like accounting and more like marketing. This shift allows IR teams to borrow proven tactics from their marketing colleagues, particularly regarding data and feedback loops.
Marketing teams don’t just put out an ad and hope it works; they measure click-through rates, watch time, and sentiment. Modern IR tools now allow for similar precision. By using encrypted distribution platforms, companies can measure exactly how their content is being consumed.
Instead of guessing if the market understands your story, you can see exactly which parts of your presentation people skipped and which parts they replayed. This data allows for a “living, breathing, evolving” IR plan rather than a static annual calendar.
Best in Class: Who Is Getting It Right?
Companies like GSK have mastered the art of providing context, says Alex Stella of InvestorHub. Rather than relying solely on the CFO to explain the numbers, they use their digital platforms to let team members explain ground-level operations.
This creates a layered understanding of the business that a PDF simply cannot achieve. According to Karen Almeida of Conran Design, Other names who excel in this new era include Tesco, SSE, and Bunzl, all of whom have moved toward high-impact, multi-channel storytelling.
Final Thoughts: Is Your Strategy Static or Living?
If the market doesn’t understand your business, it’s likely because you are speaking a language (and using a medium) that the market no longer uses. The “three-second rule” isn’t a death sentence for complex businesses; it is a challenge to be clearer, more concise, and more accessible.
To bridge the gap, companies must stop viewing IR as a quarterly hurdle and start viewing it as a continuous, high-impact marketing campaign.
Learn how an IR podcasting channel with Auddy empowers you to add context beyond disclosure, reach investors on their terms, and measure real understanding – download the fact sheet.
