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Magazine Issues » March 2020

Inside view: Unreadable: that’s what you are

Unreadable_electronicFrom the information available to them, fund managers could publish intellectual and emotional gold dust. But what they upload is “electronic disappointment”, says David Butcher of Communications and Content.

Once upon a time, we weren’t all drowning in content.

In the boom years before the financial crisis, investment businesses saw little need to publish their own material.

Take Schroders – a large and successful firm then, as it is now. Its website in, say, 2005, didn’t offer much: company results plus a few articles on the introduction of international financial reporting standards and other technical subjects.

If you wanted to find out what your fund manager thought about a given topic, you would call or email and ask for it.

Fast-forward 15 years and, thanks to digital technology and smartphones, every business is now a publisher. But in a world where it’s easy to find someone’s thoughts, there’s a paradox.

And the paradox is this: why do fund managers, bright people solving interesting problems, create material that’s so hard to read?

In other words, how does such intellectual and emotional gold dust get turned into so much electronic disappointment?

There’s a prize for those who can overcome this paradox – because investment content that can inform, educate and entertain has a very good chance of boosting client engagement.

Reading ages
We know investment content is hard to read and understand – or to use linguistic jargon, has poor readability – because empirical evidence says so.

A Communications and Content report (‘The Great Investment Content Paradox’, published October 2019) shows that the average readability score of content published by a sample of award-winning UK investment businesses is 18.3.

This score is based on reading age – a common measure of literacy.

Material at this level of readability is comparable to exam questions or textbooks from the last year of secondary education or the first year of university. Complex stuff – especially if you haven’t been studying this subject for most of your life.

In financial services, a good example is central bank speeches. When Bank of England governor Mark Carney or his team talk about the countercyclical capital buffer or foreign exchange market fragmentation, you need a reading age of 18.2 to understand it.

This is the mean average level investment content is also hitting.

The investment content score is also perilously close to academic papers published by EDHEC Business School. These documents are for academic peer review and contain all of the long sentences, jargon and complex algebra you would expect.

They have a reading age of 20.7 years.

Material published by investment businesses should aim at 14.8 years.

This is the level required for the best parts of the financial media – the Financial Times, The Economist and leading trade magazines, such as Funds Europe – all of which have the remit of informing, educating and, at times, entertaining.
Investment content is overshooting its target.

The most complex content
What makes this overshoot interesting is the lack of correlation between readability – again, how easy a piece of material is to read and understand – and the labels attached to that material.

And this is a second aspect of the paradox: investment content is not only too complex as a whole – it’s almost always too complex for the specific audience it’s aimed at.

We know this because there’s no pattern between the labels attached to investment content (such as “professional investors only” or “suitable for individual investors”) and the readability of that content.

For example, our analysis included 13 items of content with an ‘institutional” label. Six of them achieved an academic-type score, which is probably about right, but the rest hit reading age levels right across the board – from 22 down to 12, which is well below the financial media level.

But what’s really noteworthy is that, if you’re a private or individual investor, perhaps with an investment content reading age of 14.8, you’re more likely to get more complex material. The average reading age for content aimed at this audience is a very high 19.4!

This is university-level material for entry-level people.

Where you stand
These are early days. Investment businesses have only been publishing their own material for a dozen years or so. Some are only just starting.

So there is ample opportunity to test, learn and tweak readability.

There are five typical steps to using readability to boost client engagement.

The first is to audit content. A business might have a clear brand proposition, but if they communicate with multiple voices, without understanding the variance in complexity between those voices, then good brand work can be undermined. Audits tell you where you stand – and how much work you need to do.

Then look at audience capabilities. Our analysis says the reading age of investment content audiences is 14.8 years. But that’s for the UK market as a whole. Better knowledge of your readership gives you more opportunity to engage them with targeted material.

Third is to construct (or reconstruct) clear and simple messaging. This should apply to companies, products and thought leadership themes. Clear and simple messages act like a straight line between your organisation and your audience.

Then you can hang compelling stories off that line to bring messages to life. But these need to be readable, which means more acknowledgement of the language that people like, such as colloquialisms, and a lot less jargon and complex sentences – although in some cases, complex academic papers might be fine.

Fifth is to think of readable communications in the round. For example, a professional fund buyer will have multiple touch points with an investment business – from the salesperson’s email to the website; from RFP [request for proposal] to presentation; and from contract to client service; with social media and media relations in the mix throughout. Many businesses spread this work around multiple teams – but if these teams have different levels of readability, it will impede client engagement.

The engagement opportunity is a commercial opportunity.

For an industry under pressure from regulators, the macro environment and big tech, it makes sense to consider cost-effective measures to get closer to clients.

It’s also a courtesy: a writer who makes it easy for their reader is more likely to have a bigger impact.

David Butcher is managing director of Communications and Content

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