An unexpected amount of free time, plummeting stock costs and accessible brokerage platforms led to the emergence of new individual investors in 2020 who now make up nearly 25% of the stock market—and this momentum is set to continue after last year’s highs.
In fact, according to the latest data from Prosper Insights & Analytics’ December survey, 44% of adult Americans say they’d invest in the stock market. The same data found that more than 1 in 10 (11%) of Americans plan to buy new stocks in the next three months. For publicly traded companies, the continuous influx of new individual investors—and the millions of existing ones—presents an opportunity to build stronger, longer-lasting and more valuable customer relationships.
To better understand the value of the consumer shareholder and how marketers at publicly traded companies can successfully target this historically untapped demographic, I spoke with Jeff Lambert, founder and CEO of TiiCKER — an individual investor loyalty software platform.
Gary Drenik: A recent national survey commissioned by TiiCKER found that 80% of individual investors agree that being a shareholder in a retailer, consumer product company or brand would make them more likely to be a customer of that company or buy their products. Why is this finding so significant?
Jeff Lambert: Today’s consumers are given so many choices, making it exceptionally difficult to earn their loyalty. This survey is the first to show the massive opportunity that exists with public company shareholders, all 130 million of them, and their preference to shop the brands and companies they invest in.
According to the data’s findings, consumer shareholders, a demographic that is historically untapped by marketers, are interested in investing in what they know and understand and that’s predominantly tied to products they use, brands they love, retailers they shop or companies they admire. For marketers looking to expand their customer base, the individual investors who own stock in their business offer both a loyal and lucrative consumer.
Uncovering who these individual investors are and tapping into their $10.6 trillion in stock ownership with rewards, perks and special offers will help marketers build strong relationships and sell more product, a winning combination for the company and shareholders alike.
Drenik: The survey also found that 77% of individual investors would be more likely to buy shares of a publicly traded company if they were offered a shareholder perk, reward or product discount. Why are so many people more likely to buy shares if they get product discounts?
Lambert: Consumer shareholders, like most customers, want to be rewarded for their loyalty to a company or brand. In fact, the loyalty program market is valued at $72 billion annually in North America according to market data firm, Beroe. Over the last several years, there has been a boom in the number of loyalty programs and the hundreds of millions of participants—and for good reason. Loyalty programs boost sales and help companies build stronger, long-lasting relationships with their customers and the advent of digital has made tracking and redemption easier.
Offering a shareholder loyalty program, now possible for first time digitally at TiiCKER.com, gives individual investors the perks of ownership and encourages them to be life-long customers, which is much more valuable to the company than a nameless investor. In addition, individual investors can share the stock perks they redeem with their social networks and learn about other shareholder rewards via the TiiCKER software platform that links to any online brokerage account, which can lead to more investors becoming interested in investing in, and ultimately shopping and spending with a company and its brands.
Drenik: From DoorDash to Airbnb, many consumer-facing companies went public in 2020. What should marketers at those companies know about the consumer shareholder demographic?
Lambert: Despite the Covid-19 pandemic, 2020 had a significant number of successful IPOs with notable products and services like mortgages (Rocket Companies – Tii:RKT), music (Warner Music Group – Tii:WMG) and mobile apps (GoodRx Holdings – Tii:GDRX) hitting the public markets. For marketers at these companies, they gained the limelight and capital infusion of the IPO, but they also added hundreds of thousands or even a million individual investors, the majority of whom are fans of the company, their brands and their products. Unlocking and marketing to these new loyal consumer shareholders is often overlooked but stands to be a major win for public companies and their marketers and investor relations officers alike.
Due to an archaic infrastructure with SEC reporting requirements, most public companies don’t realize their individual investor count is, on average, 10-20 times larger than their reported shareholders of record. By uncovering the true number of consumer shareholders, these marketers can reach individuals who are 80% of the time already customers of that company or buy their products. For both new and existing publicly traded companies, partnering with TiiCKER can help them verify and connect with their shareholders to offer rewards and perks for their loyalty.
Drenik: Historically, why has it been so difficult to reach consumer shareholders? Why is this demographic untapped?
Lambert: As of September 30, 2020, a total of $10.6 trillion was held by individual investors in the leading U.S. online and discount brokerages, a substantial pool of capital that individual investors are directing into stocks of their choosing. However, this lucrative demographic still remains largely untapped for a variety of reasons that have become increasingly complex over the years.
Historically, there hasn’t been a simple way for publicly traded companies to know who their actual individual investors are, let alone market to them as consumers. The rise of popular trading platforms has also added to the complexities of this process making the consumer shareholder a demographic that’s hard to identify in an efficient and economical way despite its massive size and overwhelming loyalty.
TiiCKER aims to change this by reinventing how individual investors are rewarded for brand loyalty by seamlessly connecting brands and shareholders through rewards and perks. Using the platform, investors connect their brokerage accounts and receive immediate access to shareholder perks and commission-free trading. For the brands it partners with, TiiCKER enables companies to engage, verify and reward individual investors to better serve and understand their investors and maximize the lifetime value of their consumer shareholders.
Drenik: What advice would you give new investors looking to discover the perks of ownership?
Lambert: Last year saw a massive increase in the number of individual investors hitting our site and linking tens of millions of dollars of their stock holdings, and most were seeking out perks for their ownership. The universal shift to free trading has removed many of the barriers to stock ownership that formally existed, allowing a broader demographic of individuals to own brands they love and discover the perks of ownership.
Using platforms like TiiCKER.com, which highlights brands that people know and understand, can help those new to investing discover stock perks tailored to their shopping habits or individual interests. With TiiCKER, not only do they invest in the brands they know and love, but they’re also rewarded for their loyalty to these brands, which wasn’t available online ever before. From the company perspective, offering perks encourages all types of investors to hold the stock rather than treating it like a game to win or lose. Not only does this discourage day trading and rash decision-making that can lead to financial losses, but it can also help build stronger, long-lasting customer relationships.
Drenik: Thank you for taking the time to share your insights on the untapped marketing potential of the consumer shareholder demographic, Jeff. I look forward to seeing how this demographic continues to grow in 2021 and the impacts it has on companies’ marketing strategies.
To see how a quality and accurate data set can be applied to target marketing models and time series forecasting Prosper has partnered with AWS to make their data available via the AWS DataExchange. Included in the data are a series of US signals, leading indicators, predictive analytics and advance privacy compliant marketing models for the US and China:
To read my previous Forbes articles on changing consumer behavior, predictive analytics, machine learning, data privacy and more, please click here.