Thursday, December 20, 2018

9 Finance & FinTech Trends for 2019

Each year we look at trends that will be relevant to our client base. Since a significant portion of experience has been with financial software companies, financial services and FinTech, here are 9 trends we think will be important in 2019:
  1. Trade wars, tariffs trade deals, globalization, deficits and the state of the economy will be a big story. China will be a big part of the story. And recession watch will be a significant angle, after 37 quarters of the longest expansion in U.S. history. For example, we expect a lot of how- to-prepare-for-the-coming-recession articles. We're not going to predict how the economy goes -- though an uncertain economy combined with a volatile stock market doesn't look good -- just that it will clearly a big story in 2019. 
  2. Brexit matters but not from a political perspective but for what it means for London. Our interest here isn't in the political implications. We feel that there will be a lot of coverage regarding the impact on London as an important finance center. Finance firms and those that provide services to them may find they need to shift their European offices from London to some other EU city. We would have bet that Germany would be the most logical successor to London, but with uncertainty around what happens after Merkle, we will want to hedge that bet. (Though compared to the unrest in France, Germany still looks like a better choice.) 
  3. A big year in iPOs? Some high profile unicorns -- including Uber (currently valued at $72B) & Lyft ($15B), Slack ($10B) and maybe Airbnb ($31B) are looking like they'll go public in 2019. There will be a lot of attention paid to how they do with the idea that their IPOs serve as a market indicator. That may not be accurate. Moderna went public this month and raised $604M, valuing the company at approx. $7.5B. But the stock immediately fell below its initial asking price. So hard to read the tea leaves on that. If they delay their IPO, that, too, will generate coverage -- and tell us something about the market.
  4. FAANG stocks will continue to generate ink. FAANG stocks are: Facebook, Apple, Amazon, Netflix and Google, and they will continue to dominate media coverage because a significant majority of Americans rely on them for information and entertainment. That's not going to change in 2019. (Keep in mind at least one of those companies isn’t profitable.) That said, Microsoft has almost stealthily become one of the most valuable companies but adding M to the acronym makes it unpronounceable. 
  5. The Cannabis market is growing strong. One issue that really hasn’t gotten attention: Because under federal law, pot is still illegal, the cannabis market remains a cash business – even in states that have legalized it. We expect three topics to get coverage: 1) Will banking laws change to allow legal cannabis retailers to accept credit card payments? 2) How much taxes is legal cannabis sales generating for each state? 3) How does HR handle employees who are work while high?
  6. Student debt is a big issue and will continue to get coverage. This is an ongoing story that we include in our list because, while obvious, if we did not mention it, someone might gleefully knock us for not mentioning such an important issue.
  7. The allure of the heartland for business and investment. The Midwest and other parts of the country that are not on the coasts have been slowly but steadily getting coverage over the past two years as being great, overlooked alternatives to expensive, overheating markets like San Francisco/Silicon Valley, New York City, etc. We think those articles will continue to hit in 2019. We also think economics of the heartland will take on additional importance as the 2020 elections approach, and voters, reporters and politicians realize there's still a strong feeling of have-notism among residents in rural communities. 
  8. The evolution of FinTech. Consumer-focused financial tech startups, known as FinTech, began as concepts to disrupt traditional banks by offering digital-first financial services. But because of the complexity, the initial wave of FinTechs focused on banking function at a time. We've reached a point when Fintechs are in a position to combine more offerings that are smarter, more dynamic and interactive than traditional banks' website or app functionality, offering new ways to bank, invest, pay and manage mortgages, track spending, etc. In 2019, we expect more FinTechs to be acquired by traditional banks but not just because of the FinTech's technology but because they provide access to millennials who may not be thrilled with traditional banks. There's also B2B FinTechs, which provide services to banks. We expect those to grow in importance but will be hard for them to get coverage outside of when they're acquired because they play a very behind-the-scenes role.
  9. The state of bitcoin. Bitcoin and blockchain went mainstream in media coverage in 2018 (as we predicted) and will continue to generate coverage in 2019. In a time of daily political chaos, we think more people will be interested, there will more skeptical coverage trying to make sense of the bitcoin market. We think it will continue to defy logic but that won't stop people from investing in bitcoins or the market reducing its volatility. 
Let us know if you think. We will publish another set of predictions in early January so stay tuned.

Wednesday, December 19, 2018

4 Additional Media Trends for 2019: including "News Fatigue"

We live in a media-centric world. And by "we," we certainly mean Birnbach Communications but we also mean Americans. That's true even as:
  • Traditional media has been facing a tough time because their business models have been failing, despite a significant uptick in the demand for news.
  • Digital media isn't the sure thing it was once thought to be, despite the lack of traditional media's baggage (like lack of printing presses).
  • Local media outlets have been shutting down, despite the common wisdom that hyperlocal was a solution.
  • People aren't reading newspaper content on paper (but on screens) or watching TV shows on TV (but on screens).
Last week, we issued our top five media trends that included: the rise of streaming content; the age of mass media is dead; the broken business model and the rise of "news deserts"; social media under scrutiny; and more apps will try to fight/block fake news.

But we have more -- yes, more -- media predictions. Keep in mind that some of these are based on predictions we made for 2018 but it's important to note that we believe this trends will continue, which is why they didn't make our top 5 but why we're included them here:
  1.  The shorter/faster news cycle is distracting Americans and causing news fatigue. We're suffering from news fatigue -- overwhelmed by news notifications on our phones that seems to buzz every hour. There’s never enough time to process significant news before we’re buzzed by the next alert (that may not be relevant). News is so pervasive it overtakes previously non-politicized events like sporting events, entertainment industry award ceremonies, family holiday meals, etc. That buzz is so addictive that people actively check social media to get the latest shocking news. Even reporters who don’t cover politics flood their social media timelines with political news (regardless of their political beliefs), making it harder to get their attention when pitching them. The 24/7 distraction also makes it harder for people to pay attention to your story – so it may take more touchpoints to break through the clutter.
  2. The incredible shrinking newsroom. A decade ago, most newsrooms used to employ more reporters to cover the news, and the amount of pages that newspapers and magazines had to fill was larger. Today, news reporters have to cover more news with fewer resources and less space. Locally, at the Boston Business Journal, a terrific weekly, staff reporters typically file four or so stories a day, may have a weekly newsletter they produce and then must write a longer article for the weekly printed edition. Radio reporters now also have to write up a print story for the website in addition to producing their stories for the radio. All of this is to say that there are fewer reporters and they have to produce much more. This makes it challenging for them to take meetings, cultivate sources, uncover stories that need to be told. According to the UNC School of Media and Journalism's Center for Innovation and Sustainability in Local Media, the result of all this is that "Many newspapers have become ghosts of their former selves, both in terms of the quality and quantity of their editorial content and the reach of their readership." (See credibility issues, below.)
  3. The credibility of news media is under attack. There is at least one area of commonality between liberals and conservatives: each group has key media it favors (due to confirmation bias, i.e., their echo chamber) and those outlets whose reports they disagree with and don't believe. Americans increasingly hate either Fox or CNN; the New York Times or Wall St. Journal, for example. With Trump and others calling articles they don't like "Fake News" or "the enemy of the people," and people on the other side pointing to Hannity (who had said he wouldn't campaign for Trump but then came out on stage at Trump's last rally before the midterms), etc., the problem is that the credibility of journalist and media outlets across the spectrum is now being questioned.  That's a real problem for PR functions and agencies who work with reporters, editors and producers to tell their clients' stories. If there are those who disbelieve the New York Times or Wall St. Journal, will they believe your organization's news in those or other outlets? Seems doubtful. 
  4. The war on screen time. There will be greater acknowledgment that we’re all on screens too much throughout the day. It’s a problem for everyone, not just adults. We expect more people – suffering from news fatigue, will turn off notifications on their phones so they don’t get interrupted/distracted as much. And somewhat ironically, there will be apps, like Apple’s "Screen Time" and Google’s "Family Link," a parental controls app, that will help you manage your screen addictions.
We've previously mentioned news fatigue in posts about living in the "Age of Anxiety" and are including it in our 2019 set of predictions because we think both will continue (we're not out of the anxiety woods yet and were going to continue to suffer from news fatigue for some time to come.

We will post more of predictions over the next few weeks. Let us know what you think.


Tuesday, December 18, 2018

3 Wall St. Journal Articles Validate Our "Age of Anxiety" Prediction

Back in Nov. 2018, we blogged about a new prediction: "Age of Anxiety to Continue into 2019." 

The factors leading to the Age of Anxiety include:
  1. What can seem like a continuous cycle of breaking news. Each hour we got another notification on our phones about another piece of news. The notifications can feel like they're hitting so often that we don't have time to process what happened an hour ago, leaving us feeling unsettled.
  2. The continued proliferation of fake news, by which we mean disinformation -- intentionally false news spread deliberately (not merely news that one politician or another disagrees with) -- is succeeding in creating an atmosphere of distrust of news, politicians, institutions and each other.
  3. The spread of misinformation -- wrong or incorrect information that is spread but not necessarily with the intent to deceive -- on social media is polarizing and causes distrust, which leads to anxiety. Social media also spreads anger as people inside one bubble get increasingly angry at people in another bubble.
  4. Uncertainty about the economy, the future of healthcare (including key features people like: keeping kids on parents' policies until age 26 and coverage for people with pre-existing conditions), etc. leave people anxious.
There are other factors but for this blog, the key point we also made in that prediction is:
Consumers are looking for less stress, and we expect articles about unplugging and de-stressing. We also expect that companies that can position their products or services as helping to reduce stress, will see those messages resonate with consumers (even if that approach is not necessarily newsworthy on its own, i.e., it might not generate media coverage even as that approach could be effective). 
We are advising our clients to look at how they can help reduce stress and anxiety through their products and services. 

Meanwhile, here are three Wall St. Journal articles that appeared yesterday and today that validate our prediction:
  1. Inner Peace Is a Booming Business though the columnist adds a cynical perspective: "Voices calling you to ‘find your escape’ are likely seeking a buck like everyone else." We think cynical plays won't work but the headline affirms our prediction.
  2. The Battle to Control Your Mindfulness: A pair of apps preach relaxation to millions of customers -- but the competition between them is anything but Zen.
  3. The Benefits (and Risks) of the Mental-Health Day. More workplaces are allowing time off for employees facing stress, anxiety or depression, but not all bosses are understanding of their workers’ needs.
Mindfulness has been getting increasing play over the past few years, and we expect that to continue in 2019.
Please note: we realize that by pointing out that we're living in the Age of Anxiety, we're not necessarily making people less anxious. But we think it is important to understand the moods and trends. 

Please also note: When we say "validated," we don't mean that the Wall St. Journal saw our prediction and said, "Yes, those folks at Birnbach Communications are correct." We mean that we made the prediction, and then the Wall St. Journal wrote about articles that touched on a particular trend, proving we were right in making our prediction.


Monday, December 17, 2018

Our Year in Review for 2018

In the spirit of that quote from Ferris Bueller, "Life moves pretty fast. If you don't stop and look around once in a while, you could miss it," we're taking a look at some highlights from 2018.



We correctly predicted that the news cycle would get faster and shorter -- that is: instead of a 24-hour news cycle (which was the case until about a decade ago), we now have news that breaks hourly. Or it seems to break hourly. And then the significance of the news dissipates in less time than ever. In 2018, there were just a couple of news stories that played out over a week. Must were forgotten the next day. 

So as a way to remember good things that happened, to look around, here are some highlights of Birnbach Communications' year:
  1. We generated nearly 36 bylined articles (for our clients and ourselves) this year -- nearly as many as we did in the last two years combined. This represents a growth in our thought leadership practice.
  2. Blog articles we wrote for clients continued to drive traffic to their sites. For one client, traffic in 2018 increased substantially over the prior year. We generated 95.46% more visitors than 2017 and saw an increase of 95.24% in terms of new users in 2018 to the site as compared to 2017. The number of pageviews increased by 37.95%. For context, we worked for the client in 2017, too, so it's nice to see continued growth for them. 
  3. In our second year working for a STEM non-profit, we came up with new ideas to extend their reach. Our recommendation to develop a turn-key press release for the non-profit's partners was successful and generated more than 80 articles in local, education and national media.
  4. We helped a client manage an acquisition by a global player that's little known in the U.S. Our work helped generate ongoing coverage of the deal and its implications. Our strategy successfully generated coverage and traffic to the site.
  5. We helped generate awareness around funding announcements for clients operating in AI/robotics, healthcare and fintech sectors. 
  6. We generated international coverage for a non-profit and provided PR recommendations for an international scientific research institute.
  7. We expanded our experience into agtech, fintech and finance, AI and robotics. 
  8. We have strengthened our positioning in thought leadership.
Our work in 2018 helped raise the profile of our clients among key constituencies, drive traffic to their site and supported lead-gen activities. Our thought leadership campaigns led to an acquisition and positioned our client as forward-thinking in their sectors. 

We look forward to continued growth in 2019, and wish you the same. 

Wednesday, December 12, 2018

Birnbach Communications Issues Five Media Predictions for 2019

For the 17th year, here are our top media, social media and marketing predictions for 2019. It is a disruptive time for the media, bringing both chaos and opportunities.

Without further ado, here are five of the agency’s top 5 media trends for 2019:

1.      The growing number of streaming content services make consumers harder to reach. The number of people who stream content as well as the number of apps providing on-demand content is rapidly growing. Already 61 percent of Americans, age 18 to 29, regularly watch or listen to what they want, where and when they want it, according to Pew Research. Apps for CBS, TBS, NBC and ABC are ad supported – only by national brands – but more dominant services including Netflix, Amazon Prime, HBO Go, Hulu Plus, YouTube Red, and Spotify Premium are ad-free, putting their subscribers out of reach for marketers.

2.      The age of the mass media is mostly over. It’s a niche world now. Partly that’s because marketers can now reach very specific audiences, along with nanoinfluencers, since online media can tailor content by gender, age, interest, political persuasion, etc. (Unfortunately, print media also is increasingly becoming niche, due to an ongoing reduction of the number of pages and size of their news staff combined with an increase in subscription rate.) In 2019, it’s complicated and expensive to reach a broad audience so marketers need to consider targeting key audiences through niche media.

3.      The broken business model for news will cause continued problems in 2019, including an increase in “news deserts.” It’s not only print media that will struggle in 2019, online media will struggle, too. The reason: online subscription fees are lower than print subscriptions and online ads generate less money that print ads (even though online ads provide much more useable data). We expect, unfortunately, more layoffs, smaller printer runs, smaller and less frequent issues – both online and in print. In 2019, we're going to see a growing number of "news deserts," defined by the UNC School of Media and Journalism's Center for Innovation and Sustainability in Local Media, as "a community, either rural or urban, with limited access to the sort of credible and comprehensive news and information that feeds democracy at the grassroots level." News deserts are a problem because it means communities aren’t getting critical information related to civic life, government services, etc.

4.      Social media will continue to undergo scrutiny and it won’t look good. And despite that, people still won’t quit Facebook, Twitter, etc. amid growing concerns about privacy and disinformation campaigns. We expect Congress and the EU, the UK and other governments to look to regulate social media. But we also expect that most won’t be able to regulate effectively because most politicians don’t have a firm grasp of how social media works. There will be more hearings but not many solutions because it’s a complex issue that algorithms alone can’t solve.

5.      More apps will try to combat fake news. Already there are at least a dozen initiatives – with names like The Trust Project, News Integrity Initiative NewsGuard, The Journalism Trust Initiative, Accountability Journalism Program, Trusting News, Trust & News Initiative and the oddly named Media Manipulation Initiative. Many are funded and staffed by journalists and also use algorithms to detect fake news. We hope they succeed but suspect they’ll be as successful as Tumblr, Facebook and Twitter have been to fight hate speech -- which is to say: not very effective but better than nothing. (A.I. will get a lot of attention but trust in algorithm will decline.) In the meantime, Axios’s Jim VandHei offered some suggestions: Stop using the term – it doesn’t help. And people should “Quit sharing stories without vetting them.” (We don’t think that will happen, either.)



In addition to these media predictions, we will roll out additional trends focusing on technology, fintech, artificial intelligence, retailapoclypse, the labor shortage and gig economy, and other topics here on our blog at blog.birnbachcom.com.

Please let us know what you like or disagree with. We'd love to hear from you. As usual, next November, we will evaluate how we did with this year's predictions.