The European Stock Markets Are Dull And Uninformative

With thousands of people active in shaping opinions about the nature of capitalism, the merits of shareholding and trading on-line, the European stock markets are dull and uninformative.

There will have to be a change if they are to be globally competitive for the Internet Society.

Of course, the more aware Investor Relation manager will be monitoring the Internet for references to company stocks. The cost is not exorbitant (about £500 per month) and includes comments of Broker’s sites and from analysts. Promoting shares using the Internet is covered by the Rules of the Stock Exchange (not that the LSE has made much effort to guide companies in this field so far), and within these rules, IR managers have considerable scope to interest and inform shareholders and potential shareholders.

As we now know, investors seek information about companies and their shares using the Internet. The rules for attracting people to the financial pages of a corporate Web site are not dissimilar to promotion of other aspects of the business.

While most are dry and unappealing, some companies are now making an effort to interest shareholders, bring them back to the site and create a genuine ‘family’ feel about the company. By creating a virtual community with an interest in the company and its shares, share values can be sustained and enhanced.

In the first place, the financial pages of a Web site need to be designed as a whole and specifically aimed at shareholder interests. Even institutional investors like to see well  designed and welcoming financial pages. They like to see a company promoting the merits of share ownership, and to be able to access Analysts and Newspaper comments about the company from the site. They are interested in events that will affect stocks and corporate decisions aimed at enhancing (or protecting) share values.

Of course the financial information has to be included and, on a Web site, they can be fun, interesting dynamic and worth re-visiting on a regular basis. Slow sites and pages that look like copies of the Annual Report (looking like a brochure instead of a Web site), are, of course a big turn off. Not all investors have fast ISDN lines so that the speed of a site is important.

The return for a company is measurable. How many people turn to the financial pages of a Web site (and how many access this part of the site directly without clicking through umpteen pages of ‘our history’ and ‘a view of our factory in Cayman Islands’) and then dwell on these pages, gives an indication of potential investor interest.

We know that if the site is designed to offer an interactive relationship, then it will be re-visited and, in addition, sustaining the interest of existing shareholders will aid the development of a share holding virtual community with the benefit of sustained, continued and enhanced investment.

Offering simple access to brokers and helping investors buy shares is essential (not just hyperlinks but a more proactive and involving experience) and it also offers the capability to measure the extent to which the Internet Community looks at and forms an opinion to buy. There is evidence of the effect of ‘brand equity’ value obtained in this way bringing Netzines (including investors) back to a site even if they have had a previous bad experience.

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