Twice A Year Communicating Not Often Enough To Nurture A Relationship

"Megan S. was mugged on campus by two squirrels working together. DO NOT EAT POPCORN OUTSIDE. Details when we talk."

Immediately after I sent that text message to my college freshman niece, I had to wonder where Katy would be when her phone vibrated and she read it. We haven’t spoken in a week and the last time we texted was a day ago, on a different subject. And yet I knew that she would take the information in, modify her behavior and wait to hear more later. My communication was efficient. Like most text messages and lots of other electronic communicating, it didn’t need a salutation or a signoff. Really, anything else would have been in the way.

This is an apt illustration of how “conversations” between people are extending over days and topics and media. The next time Katy and I communicate, we’ll start up again in the middle of the conversation we’ve been having for 18 years. By contrast, when I was in college, the letters I received from home had a start and a finish. They struggled to keep me in touch with the homefront. When I’d read them, the communication ended until someone on either side would start the process all over again. Texting and other means available to us today aid understanding and keep precious relationships current.

I mention all this by way of encouraging financial services marketers to consider how the external world is adapting to a new kind of continuous communicating. There is a gaping difference between how freely and frequently others (yes, companies too) are exchanging information and the stilted annual and semiannual communications investment managers distribute weeks after the close of an investment period.

Election Night “Barack Obama” sent me a text: “I’m about to head to Grant Park to talk to everyone gathered there, but I wanted to write to you first.” After he commented on his victory, he promised to “get back in touch soon about what comes next.”

How many portfolio managers have reached out to their mutual fund shareholders during this financial market meltdown with a brief update and a promise to keep in touch? What impact might this have had on investors? I know that the Barack who wrote me the email was no more real than the Santa Claus I saw outside a store the other day. And yet both had the effect of strengthening my commitment to their work. Behind both were marketers who know the value of nurturing a relationship.

With just weeks to go before the close of the year, we urge investment managers to be especially thoughtful as they prepare their explanations of how their funds have fared. There’s an excellent chance that these shareholder reports will be read. Having been scolded by legislators and others in Washington for not paying attention, the American public—even those who rely on the recommendations of their financial advisors—can be expected to be taking an interest and piecing things together. Year-end communications tend to be either on auto-pilot or relegated to the most junior on the Marketing staff. You may have to throw your body in front of the perennial capital gains press release that starts with, “We are pleased to announce capital gains distributions…”

Beyond the required communications, though, we believe that much more can be done to initiate and conduct conversations with investors using digital media. At some point (I’m guessing), telephones might have been considered avant garde for businesses. Today, you can’t be in business without a phone. We may be heading toward a time when companies content to communicate twice a year with their end-users will be endangered.