The workings of economic cycles can be compared to drinking alcohol at a party: there is a blood alcohol level that can facilitate social interaction, lower our inhibitions and even give us good ideas, as can be seen in David Vinterberg’s film ‘Another Round’. But once that level is exceeded – which, once the party gets going, is bound to happen – almost everything becomes a problem. Among these, getting up the next day.

We can also liken credit to a good drink. The easier it is to grant loans, the higher the blood alcohol level. And, although we are relatively rational creatures, when alcohol starts to take effect, it always creates a certain sense of euphoria. If we equate alcohol with money, we arrive at the concept of financial euphoria: there is always a moment when we are convinced that our investments, our financial gambles, will yield the best results, as if the scenario we construct in our minds were to play out exactly as we imagine in reality. And that is precisely when we are at our most dangerous – to ourselves and to others.

From this feeling of being delighted to meet each other, we move on to the financial bar and get more money (or more drinks). With these financial drinks, we snap up shares, property and foreign currencies that can only go up in value. We win, those who sell win, and the barman wins too – the employee of the ‘alcoholic bank’ who, for the moment, is offering an open bar for everyone. The night stretches from midnight to four in the morning. And the body begins to show signs of exhaustion. And intoxication.

Only those who know how to drink, whether by nature or through experience, will leave the party on time. Those of us who stay will keep partying on. When a lot of people have already left, the disco begins to take on the look of an after-party. The investors least informed, those drinkers who are reckless or naive, continue to drown in alcohol, and the financial assets acquired, those drinks of more, no longer feel the same as good.

There comes a point when the alcohol-fuelled bubble bursts and you’re no longer dancing as you’d initially imagined. You might even wake up next to a stranger who, just a few hours earlier, was the conquest of your life. The sun shines right in your face, filtering through a rickety blind in a shared flat. Everything you did in that state of euphoria now seems like utter nonsense. A sense of shame sets in: many investments were based on overly optimistic decisions and forecasts of financial results that are no longer looking so good.

To continue with the analogy, all those in debt who bought things that were not actually worth that much are now in a great deal of pain. They have become impoverished and cannot offload the houses, assets or currencies they acquired during the boom. They are no longer winners but poor investors. In this case, the side effects will last more than a year or two, often for a lifetime. This is what happened, for example, following the 2008 financial crisis, which made it clear that many of the investments and loans were of very poor quality. The hangover is still being felt today, with a sullen Parliament full of hatred and poor responses. A democratic headache.

Regulating alcohol has led to almost always negative consequences. Prohibition strengthened the mafia and the criminal trade in the United States. So the solution should go in another direction: it would consist of telling people that getting rich quickly is like a street party, an event which only a minority of elected representatives can survive successfully. And that one must tread with great care when night falls, because the shadows cast on the ground deceive us if we are prone to it.

Political courage should consist of this: being able to burst the bubbles, and thereby break the self-destructive tendencies of society, whatever the electoral cost; limiting the banking sector’s lending capacity during periods of euphoria in order to bolster it during periods of depression, when loans are most necessary and urgent; and in not being seduced by periods of easy growth, but rather seeking to encourage investment in the economic fundamentals that are most likely to yield returns in the long term.

To conclude, let’s imagine a night out that allows us to have fun and get home before two in the morning. It might not be what the films show, but it would let us enjoy a good night out without overdoing it to the point of regretting it the next day. It’s not the most exciting option, but perhaps it is the most sustainable. We need political and business leadership that seeks exactly that. And, unfortunately, everyone is currently shouting, glass in hand, gazing at the moon as if it were there 24 hours a day.

*Article written by Andrés Villena, lecturer in Applied Economics at the UCM

La entrada Communicate to prevent drunkenness se publicó primero en Agencia comma.

The bubbles that fuel periods of financial speculation take shape long before prices collapse. Sometimes they are mere trial balloons, but on other occasions they appear to be grounded in reality. In any case, these bubbles arise from ideas. Before accounting imbalances or credit excesses—the triggers of stock market crises—accumulate, they take root in the investment climate through a collective narrative that seeks to convince people of a radically different future in which the classic rules of asset valuation no longer apply.

Do investors tend to suffer from low self-esteem? Are they simply the target of speculative greed on the part of certain market gurus seeking profits? Do they sometimes forget to value assets in the short term, to look beyond the immediate horizon, or to take a long-term view of their investment portfolios? Quite often—and not infrequently—the answer seems to be yes, judging by the rapid spread of episodes of irrational exuberance that have occurred since the middle of the last century. The IMF, for example, has recorded 414 currency crises, 200 sovereign debt crises and 151 banking crises. Dozens of them every decade.

It is true that most are local or regional. They appear to be limited in scope. But we must not underestimate their propensity for chaos. Because there have been ten instances of financial instability on a global scale since the oil crisis, some accompanied by global recession and all by stock market crashes, such as that of the 1973–75 period and its seismic aftershocks in the 1980s. Almost without a break, the Latin American debt crisis emerged. Another period of stress with widespread geographical repercussions that lasted a long decade until the Tequila Effect was overcome, which depressed the Mexican peso and spread to the markets and several banking systems. Or Black Monday in 1987, with synchronised falls from Hong Kong to every stock exchange on the planet, and the crunch in Japan two years later, which ushered in three long decades of economic stagnation and deflation in what was then the world’s second-largest GDP.

Before the end of the 20th century, there was still time for competitive devaluations of Asian currencies to take place and, almost in parallel, that of the Russian rouble, which resulted in five prime ministers in two years before Vladimir Putin came to power.

More recent —and even more global — have been the dot-com of 2000, with origins in the US and spreading recession in Germany and the credit crisis of 2008 with the nationalisation of Lehman Brothers and suspension of trading on the Stock Exchange in Moscow due to the freefall into the depths of hell of its share price. It was like watching the world upside down: the paradise of the free market buying with federal funds a a45> bank of investment private and the former USSR preventing the collapse of trading in capital. But it was not the last major systemic crisis. The European debt crisis of 2012, which was on the verge of bury the euro, and the Great Pandemic of 2020 caused by COVID -19 also led to economic contractions.

Common themes in the story

The story that has accompanied all of them has not been exactly the same. However, it contains common threads. The narrative that takes root in the markets not only persuades the investors, but also extends into the public arena. Analysts, banks, the media and political leaders end up reaching a consensus which seems to confirm that structural change is inevitable and is underway.

The 2013 Nobel laureate in Economics, Robert Shiller, described this phenomenon as narrative economics, based on the idea that the stories circulating in society directly influence economic behaviour and investment decisions. When a narrative gains sufficient traction — whether it be a transformative technology, a new financial model or a seemingly unstoppable economic cycle — it can become the oxygen that fuels any bubble.

The warning about irrational exuberance

One of the most famous concepts associated with them emerged as an institutional warning. In 1996, Alan Greenspan, then Chairman of the Federal Reserve, publicly wondered whether the financial markets were displaying “irrational exuberance that was inflating stock market valuations beyond their fundamentals”. The expression became a benchmark for understanding speculative cycles. Paradoxically, the warning did not dampen market enthusiasm. Over the following years, the Nasdaq continued to rise, driven by the tech narrative.

Until it burst, the dot-com bubble was the example most visible of how a story can dominate investor sentiment. The internet promised to radically transform the economy, eliminate intermediaries and generate new forms of productivity. Technology companies began to gain value more due to their potential rather than for their actual profitability. Shiller explained it in his a46> influential book Irrational Exuberance: “the markets can enter into dynamics collective where optimism feeds feeds back into and in which each rise confirms the dominant narrative, and that narrative continues to attract new investors”. In 2000, the Nasdaq crashed and the narrative changed with the same speed with which it had been built.

In the years leading up to the 2008 financial crisis, a widely accepted dogma also took hold: house prices were a structurally safe asset. This assumption justified an extraordinary expansion of mortgage lending. From so-called subprime loans to complex financial instruments. They were dubbed “toxic assets” and became a permanent fixture on bank balance sheets. They were vast in scale following years of excessive lending and, above all, highly dangerous due to the dubious recoverability of the loans granted. They imploded when the credit cycle began to deteriorate and the international financial architecture revealed its grave fragility.

Very few investment voices—including, amongst others, Jeremy Grantham and Nouriel Roubini—warned several months in advance that the US property market was in the grip of a bubble and that a correction was inevitable. To no avail. Because the prevailing narrative continued on its optimistic course.

Spain and the rhetoric of bricks

In Spain, the property bubble also had a very clear rhetorical dimension. Over the years, a mantra became firmly established in political speeches, industry reports and everyday conversations: that property was always a sound investment and its prices never fell. This narrative served both an economic and a cultural function. It justified a growth model based on construction and reinforced the perception of housing as the safest asset for family savings. The logic was simple and powerful: building created jobs, jobs drove demand, and demand sustained prices.

So, when the international financial crisis spread to the European banking system, that dynamic quickly faded. The once-stable engine of growth became the most serious vulnerability in the recent history of the eurozone’s fourth-largest economy.

The narrative pattern of bubbles thus follows a recurring pattern:

· Innovation or structural change: a technology or economic model emerges that promises to change the rules of the game.
· Expansion of capital and credit: markets mobilise resources to capitalise on the opportunity.
· Consolidation of the dominant narrative: analysts and the media reinforce the growth narrative.
· Decoupling of expectations and fundamentals: valuations become detached from economic reality.
· Abrupt shift in narrative: when results fail to meet expectations, the narrative is reversed.

Furthermore, on rare occasions they erupt due to a lack of information. Rather, they collapse when the narrative underpinning the optimism ceases to be credible. The new narrative—that of today’s AI—is beginning to follow in its wake. It is a technology that is transforming entire sectors, from business productivity to scientific research, and is triggering a massive wave of investment in companies involved in AI development.

To make matters worse, the voices are growing louder once again setting off the alarms once more. Top executives from firms in the investment and private banking assure that the climate for investors could be underestimating the impact of the conflict in Iran following a correction in the stock market which has become apparent on Wall Street in February, prior to the escalation of military tensions in the Middle East, due to the persistence of certain values linked to AI unleashed with excessive use of credit.

There are warnings that the market is once again functioning as a storytelling machine. And with good reason. After all, financial bubbles are not merely economic phenomena. They are also narrative phenomena. As history shows, stories are also traded.

La entrada The story that inflates the bubbles: of the irrational exuberance of the past to the new narrative of AI se publicó primero en Agencia comma.

From comma, we have contributed to promoting one of these meetings with a long-term vocation within the framework of a cause that challenges us as a sector: the ‘Diálogos Activistas de lo Mutuo’, of Mutualidad, a cycle designed to think with vision transformative and that places in the centre the solidarity, the sustainability, collaboration and the creation of more inclusive societies.

In a new chapter of this space, held at the headquarters of Mutualidad in Madrid, we have been instrumental in supporting Mutualidad and bringing together two of our spokespersons, essential figures in the industry of management of capital of our country: Pedro del Pozo, director of Financial Investments at Mutualidad, and María Ángeles León, founder of Global Social Impact Investments (GSI) and Open Value Foundation. The objective: to discuss, with data and experience, about investment in impact. It is the result of a specialised consultancy that identifies areas of authority, aligns agendas and brings together the firms that we represent so that the conversation adds real value to the audiences.

We feel directly challenged in this honest and useful debate between two brands with different approaches that are different, but one common ambition: to combine profitability and purpose.

Key ideas that emerged from the debate

• From ESG to impact: the “peak” is achieved when capital drives tangible social and environmental objectives.
• Measure what matters: metrics useful for management; avoid “paralysis due to compliance” regulations that increase costs and block progress.
• Impact and profitability coexist: the demand for sustainable assets improves their value; it is no less profitable: it is more in demand.
• Inclusive growth: growth, yes, but with inclusion from the outset, combining private initiative and policies that accompany it.
• Governance and the long term: sustainability integrated into risk and investment reinforces the resilience of portfolios and of companies.

That is the type of communication that, since comma, we want to continue promoting: creating the conditions for the best ideas to be found, to be contrasted and are turned into decisions that change economies and societies. Thank you to Mutualidad for opening this space and to Pedro del Pozo and María Ángeles León for a conversation that raises the level of the debate.

‘Diálogos Activistas de lo Mutuo’ is a Mutualidad space where conversations are held with inspiring people who have unique life stories, enriching professional experiences and diverse perspectives. They all share the same goal: to contribute to improving the world we live in. The aim is to generate reflection on current social issues that connect with the values and purpose of our organisation.

It is published periodically since the channel of YouTube of Mutualidad

La entrada Bringing together voices that transform: this is how we connect Mutualidad and GSI in a dialogue about impact investing se publicó primero en Agencia comma.

When Silvia Albert invited us to write in this blog, we rummaged through our arsenal of tools, those that, over the years, have turned mediocre companies into real success stories almost overnight thanks to branding and communication. Among all of them, thecreative territory shone with its own light.

The essence of creative territory

To begin poetically, we could define the creative territory as a space where imagination and strategy are intertwined.

The concept of creative territory is a technical and strategic gem, an indispensable tool for the construction and effective communication of a brand’s identity, regardless of sector or size. A creative territory is not simply an accumulation of scattered ideas, but a conceptual space where strategies and stories come to life, resonating deeply with the audience we want to look at us.

In technical terms, a creative territory is a theoretical framework that guides the communicative and sometimes visual development of a brand, ensuring that all its efforts align with a coherent and resonant vision. This framework not only facilitates consistency, but also allows the brand to differentiate itself in a saturated market.

In practical terms, brand territory offers economic and reputational benefits that provide considerable competitive advantage to those who understand, exploit and master it. Yes, it can take your business to the next level and make money if used correctly.

Red Bull: beyond energy drinks

To illustrate this concept, let’s start with a classic example: Red Bull. We all know Red Bull. What does Red Bull do? Although it sells energy drinks, it has exploited its brand territory in extreme sports, making this niche much more profitable than its core product. This approach has not only distanced Red Bull from its competition, but has ‘inspired’ others to emulate this strategy (MONST… ahem!).

Personal branding in the digital age

But there is no need to talk about corporate giants; this also applies to personal brands. Streamers, for instance, have discovered that generating content to entertain is not enough; they need to find a brand territory that allows them to distance themselves from their professional colleagues.

Take the example of the digital-media phenomenon Ibai Llanos. The Basque streamer has found a creative territory that has opened up new lines of business for him, generating million-dollar contracts. Its brand is white, familiar, fun and adaptable to any type of public. From presenting a boxing event to accompanying you at the New Year’s grapes, Ibai always maintains an approachable and transparent personality.

With this foundation, his brand needed a line that would make him recognisable, a territory that none of his competitors had explored. Video reactions, live video games and world travel are so saturated that they almost resemble conventional television, from which they want so much to distance themselves.

In this context, Ibai explores and finds a niche that allows him to continue doing his job, but away from the competition: organising events with traditional games; world marble or balloon competitions (whoever drops it first loses). These games that we enjoyed in the school playground or in our room in those moments of creativity without screens are the ones that are creating a sign in Ibai’s communication and future.

This dual strategy rescues the millennial generation, generates unique and different content, and creates a new communicative line that had not been explored in the streaming world. Ibai has managed to capitalise on the nostalgia of classic games by mixing it with the innovation of live events, creating a winning combination that sets it apart from the competition.

The need for a brand territory

In conclusion, the brand territory is not just another tool in the arsenal of the brand. branding, but a cornerstone that can define the long-term success of a brand. Mastering this concept enables brands to act consistently and distinctively in any context, seizing opportunities that others have not explored.

The case of Red Bull and Ibai Llanos demonstrate how brand territory can transform not only the public perception of a brand, but also its profitability and its ability to innovate in a saturated market. In short, knowing and mastering brand territory is essential to any effective branding strategy.

If you are looking to put your company or personal brand on another level, don’t underestimate the power of brand territory. Exploring it, exploring it and making it your own is essential. This is the only way to achieve the competitive advantage that ultimately translates into economic and reputational success.

*Article written by David I. Martín, CEO, and Adrián Martín, partner at Cumbre.

La entrada The art of creative territories se publicó primero en Agencia comma.

This genius or stroke of luck, however we want to see it, is present in the imagination of many Spaniards, especially the younger ones, as a role model. They are convinced that it is only a matter of time before Finman’s story repeats itself – with them, of course – and that only such investments, capable of multiplying a very small investment and obtaining stratospheric returns, are worthwhile.

In fact, most Spanish influencers only analyse equity products, especially those with very high risk, cryptocurrencies or technology stocks. This can be explained, in the first place, by the way they monetise their content. Financial content disseminators often benefit from paid promotions by investment platforms and financial products. Since high-risk products generally offer higher fees, there may be an economic incentive to promote such products. In addition, high-risk products and securities are often surrounded by an exciting and volatile narrative, which can potentially generate more interactions on social media and thus more revenue. Thirdly, the majority of the audience is young, not very knowledgeable, less experienced in investing and more susceptible to being attracted by aggressive strategies that promise quick and juicy returns.

Although this correlation between disclosure and high risk may be true, Celia Rubio, one of the most prominent investment influencers in the industry – he has more than one million followers on Instagram – he does not believe that this is a general behaviour of financial content disseminators and that many talk about other products and “the importance of creating an investment strategy and a diversified portfolio”. Héctor Chamizo, journalist and economic expert streamer, considers that although “the link between finfluencers and high-risk investment products is notable, it is important to consider that not all focus exclusively on high-risk products” and that some “take a more educational and diversified approach”.

Unfortunately, the culture of the buck, which has metamorphosed from bricks and mortar to cryptocurrencies and technology stocks, is still deeply rooted in Spain, one of the EU countries with the worst financial education along with Romania, Cyprus and Portugal, according to the European Commission. In 2021, the Bank of Spain conducted a survey with three basic questions on inflation, compound interest and risk diversification. The results were devastating: only 19% were able to answer three basic economic questions correctly.

The Internet and social media, the sieve of distorted information

Despite the bad data, Spaniards’ interest in the economy and wealth management increased markedly after the pandemic. The rise in inflation-CPI went from -0.3% in 2020 to 8.4% in 2022– , the historical increase in interest rates, which have so far remained at around 0%, and the loss of purchasing power-according to Addeco, the average Spanish wage has the same purchasing power as in 1996.– have aroused great interest in savings and investment among Spaniards.

This positive fact is diluted by this negative one: novice investors, especially young investors, seek information on these topics on the internet and social media rather than consult a financial advisor. In this context, finfluencers play an increasingly relevant role as sources of information. However, not all of them have the necessary training, knowledge and experience in economics and finance, and many of them suggest that through a few simple steps their followers can achieve what they supposedly already have: the desired financial freedom.

CFA Institute – one of the world’s foremost associations of investment professionals, known for its famous CFA (Chartered Financial Analyst) certification – published a study earlier this year on how financial communicators engage Generation Z investors in the investment decision-making process. According to Rhodri Preece, head of research at the CFA Institute, “our research shows that the content of the finfluencers often lacks the necessary risk disclosure, which may hinder consumers’ ability to assess the objectivity of the information, and some investors may not be aware of when and how the finfluencers to promote financial products.

Pablo Gil, an economist and one of Spain’s leading experts in stock market analysis, believes that “the problem we still have is that the Internet is completely flooded with bad advice, because there are many people who try to make a living by opening the eyes of the rest of the public, when in reality their knowledge leaves a lot to be desired. So there is more interest and more information, but unfortunately a lot of it is not accurate or not really good.

Are finfluencers the solution or part of the problem?

One of the questions being debated is whether finfluencers are helpful in improving financial education or whether, on the contrary, they are part of the problem. Chamizo believes that there is no clear answer: “Within the spectrum there are content creators who are not very well trained and who sell three-quarter-size motorbikes, but there are also profiles with a high added-value proposal”. Furthermore, he believes that there is no direct link between low financial literacy and the increase in finfluencers: “Not at all. The shortcomings come from behind. The creators are not part of the problem, even if some people put sticks in the wheel so that the problem is not solved”.

Celia Rubio is more optimistic and believes that financial communicators have managed to transform this knowledge that was not very accessible and that “used to be covered with a halo of complexity” to make it much simpler, so they play “an important role in this democratisation of financial education”. He also points out that as we move forward in financial education, the number of influencers, as people will be more aware of the need to keep learning and will consume even more of this type of content.

Gil, for his part, is highly critical of teachers and disseminators of financial content: “Unfortunately, there are few good teachers who really do a commendable job, and it would be as simple as looking at their curriculum vitae. If we were to make this filter, we would discover that probably nine out of ten teachers should not really be teaching this type of activity”.

Regulation follows in the footsteps of financial disclosures

On the other hand, one of the big problems is that some finfluencers, whether professional or not, are unaware that their activities are subject to regulation. Although a title is not required, the CNMV reminds that recommendations must be presented “in a clear, accurate and objective manner” and it is necessary to disclose “any conflicts of interest that the person issuing the recommendation has in the financial instruments to which it refers”. The firm conducted a review of these investment recommendations issued by influencers and “contacted those identified as ‘experts’ to request clarification on their activity and require them to comply with established obligations”.

“While the CNMV has issued warnings and some guidance to these content creators, clarity on how they should operate within the legal frameworks could be improved,” said Chamizo. He adds that “current regulation may seem insufficient in the face of the rapid growth in the number of finfluencers. Given that the impact of its recommendations can be substantial, it is essential that the CNMV establishes clear and precise rules. For example, finfluencers obtain a specific certification or adhere to clearly defined ethical standards to increase transparency and accountability,” he adds.

Celia Rubio believes that the CNMV is clear, but that “it is not adapting well to the times and the types of content” currently in existence. He adds the need to “penalise those who don’t do it right, who spread false information and talk about scams”. On the other hand, Gil believes that it is preferable for the CNMV’s stance to be more aggressive and recognises that it is better to “sanction or avoid misinformation in a generic way, even if it is to the detriment of those trainers who really have a curriculum that supports them”. The easiest job,” he says, “is to fine or ban everyone, but the reality is that you would have to do much more detailed work” to discern who really has the knowledge and experience.

Friend or foe of industry?

In the financial industry, some professionals view the role of influencers and publicly acknowledge that there is clear intrusiveness. However, not all industry agrees on this point. Chamizo believes that brokers and trading platforms see them “as a significant opportunity to increase their client base”. Their ability to reach a wide and diverse public, with a language that is close, simple and attractive, has been exploited – without being without risk – by these entities to increase their volume of transactions. Chamizo points out that the investment fund industry and other more traditional and regulated financial institutions tend to reject those who do not provide value-added content and welcome those who offer more analytical and educational work.

Celia Rubio is not so ambivalent and considers that the industry “sees it as an opportunity; an opportunity to convey messages in a simple way and to make financial products and services known in other ways”. In this sense,” he concludes, “there is a good alliance between the financial industry and financial content disseminators.

Social media are part of the debate

The aforementioned CFA Institute study outlines a series of recommendations for regulating the situation of influencers financial. One is for “social media to improve their controls and take additional responsibility to ensure that content creators are transparent and identify what is promotion or advertising”. But is this possible? Should they take responsibility?

The entry into force of the new General Law on Audiovisual Communication seeks to regulate the activity of content creators on social media by determining what they can advertise and how they must do so. However, it is not specified what social media should do with financial content that is sensational or misleading.

Chamizo considers that social media “have a crucial role to play in moderating the content that circulates in their spaces, especially when it comes to financial information. Currently, although these platforms have implemented certain measures to tackle content of dubious financial quality, there is a growing consensus that they should intensify their efforts.

Gil, for his part, doubts that social media “have the capacity to be able to analyse this in detail and know how to qualify which content is really good and which is misleading content”. Celia Rubio agrees on this point, but she does believe that there is something that all social media should do: “control scams, identity theft, pyramid schemes, aspects that are very obvious and that social media should tackle”.

Conclusion;

Finfluencers have emerged strongly in the financial industry. They have helped to democratise information and have identified a great need: the education of a generation increasingly interested in managing and investing their wealth. However, not all of them have the experience and expertise to perform this function and many of them promote products without adequately informing about the risks involved. The financial industry and the CNMV must continue to take steps to ensure that content disseminators comply with regulation and standards of transparency and objectivity, while social media take a more active role in identifying misleading content and protecting users.

La entrada Finfluencers: opportunity or threat for the financial industry? se publicó primero en Agencia comma.

Comma has been working with companies in the financial sector for 25 years and, curiously, we have many women in leadership positions in their respective companies. What’s more, there are many teams made up solely and exclusively of women who achieve the same results – or even better – than those made up solely of men. In any case, women, much less numerous in certain sectors such as STEM (Science, Technology, Engineering and Mathematics), are also less numerous in the financial world, especially when it comes to top positions.

What is it that makes the presence of women in financial sectors so low, is this really the case or is it simply that they have much less visibility?

Women are the ones who manage family economies, yet it is they who manage investment and savings. There is a clear need for women to empower themselves through financial freedom, being themselves solely and ultimately responsible for their finances. Indeed, a recent Bank of America report highlights that even in less affluent countries, more and more women are accessing banking services and becoming more involved in managing their money and making their own investment decisions.

Many examples

But today we want to talk less about women’s freedom through financial independence and more about the role of women professionals in a largely male-dominated sector. And we at comma have many examples of this, which we would like to highlight today, 8 March, coinciding with International Women’s Day.

One of the stories that fascinates us most is that of the team that runs the Money Market division of Federated Hermes. They are Deborah Cunningham (Chief Investment Officer, Global Liquidity Markets, Senior Portfolio Manager, Executive Vice President), Paige Wilhelm (Senior Vice President, Senior Portfolio Manager, Head of Prime Liquidity Group), Susan Hill (CFA, Senior Vice President, Senior Portfolio Manager, Head of Government Liquidity Group) and Mary Jo Ochson (CFA, Senior Vice President, Senior Portfolio Manager, Chief Investment Officer Head of the Tax-Free Liquidity Investment Area and Short-Term Municipal Bonds).

Their positions say it all. Federated Hermes is one of the first asset managers to create investment teams dedicated to cash management. That was 50 years ago. The team led by Cunnigham has prioritised, above all else, that people have a culture of collaboration and mentoring for each other. These women have been working together for many years, but it is a large group of more than 30 professionals, where, below the senior vice-president position, the gender split is 50/50, and with outstanding results.

In the transactional banking division of Bank of America, one of the largest banks in the world, Laura Franco, head of the Corporate Treasury sales division for Western Europe, and Andrea Sullivan, head of the bank’s international ESG platform and member of the bank’s executive committee for EMEA, are among many others.

And in Spain, we also have some notable leaders such as Almudena Benedit, head of investments for Iberia at the Swiss private bank Julius Baer, founded in 1890, and currently one of the leading financial groups in that country and with a significant presence in Spain. Or Ana Queipo de Llano, head of wealth planning for Iberia.

Beatriz Barros de Lis is another clear representation of women in the financial sector. Barros de Lis is now Head of Client Group Core America at AXA IM and lives in New York from where she leads the distribution team for the Americas Area, which covers the entire continent.

At one of the world’s largest asset managers, Natixis IM, Sophie del Campo is Managing Director for Spain, Portugal, Italy, Latin America and US Offshore. And, based in London, Carmen Olds heads up Natixis IM Solutions’ research services for Spain and Latin America.

UK investment manager Jupiter AM, whose hallmark is the investment freedom of management teams, has Susana García as sales director for Iberia.

In France, La Financière de L’Échiquier, which invests in listed companies, has Coline Pavot as Global Head of SRI investment analysis, with a special focus on impact investing, sustainable investing and the role of women in this type of investment. In fact, she is the author of the paper referred to at the beginning of this post.

Global Social Impact Investment  is the Spanish fund manager founded in 2021 specialised in impact investing with two key investment funds in Spain and Africa. María Ángeles León is its co-founder and president and has led the company to very high levels of profitability and commitment.

The independent asset manager specialising in corporate bonds, Muzinich & Co, has Tatjana Greil-Castro as co-head of Public Markets, who is also the head of the largest UCITS fund managed by a woman, in terms of assets. Tatjana is also a founding member of the leveraged finance platform ELFA and specialises in socially responsible investments and monetary policy, being a member of one of the ECB’s working groups.

In the fintech sector, Tali Salomon, regional director for Iberia and Latin America at eToro, a multi-asset social investment and social trading platform, stands out. Salomon is an expert in social investment through technology platforms, fintech innovation in trading, trends and preferences of retail investors.

Just a sample

They are not all there are, but they are all there are. The ones we bring here today are those who are currently with us at comma, but in our 25 years of business experience there are many women in the financial sector who have been and are fundamental in the development, growth and consolidation of their respective companies.

We are very proud to be able to shine a light on all these professionals, but we believe that there is still a long way to go. Giving visibility to these profiles and to their work is essential for the financial sector to face a profound transformation and to give fair recognition to the work carried out by women professionals beyond gender.

Happy 8M!

La entrada Finance with a woman’s voice se publicó primero en Agencia comma.

Every corner of the market seems saturated with eco-friendly labels, promises of sustainable practices and claims of commitment to preserving the planet; However, amidst all this ‘green’ on the shelves and in the advertising campaigns, there lurks one misleading practice which threatens to undermine genuine efforts towards a more sustainable world: the greenwashing.

Theuse of greenwashingas a master strategy of manipulation, involves the cunning presentation of afalse image ofsustainability, carefully designed to appeal to consumers who are increasingly aware of the environmental impact of their choices; Let’s dive into the depths of this practice, unravelling the layers of deception that often accompany claims of eco-friendliness;

From defining what isgreenwashing to explore the consequences for both the environment and consumer confidence; we will examine this phenomenon that blurs the line between authenticity and appearance.

What is thegreenwashing: exploring the layers of environmental deception

Greenwashing is not simply a superficial marketing strategy; it is a sophisticated form of manipulation that has become ingrained in contemporary business practices; In an attempt to capitalise on the growing environmental awareness, companies are turning to greenwashing as a ruse to attract environmentally concerned consumers, creating a smokescreen to disguise unsustainable practices.

This phenomenon adoptsvarious formsall of which are designed to present an illusory image of environmental commitment; From the use of vague and ambiguous terms to the calculated manipulation of statistics, greenwashing is a shadow play designed to make companies appear more sustainable than they really are.

The strategies ofgreenwashing can be as subtle as the choice of ‘green’ colour palettes in branding or as bold as unsubstantiated claims of environmentally friendly practices.

For example, a company could claim to be ‘green’ without providing verifiable evidence of its sustainability efforts;

In some cases, greenwashing can even extend to product design, where the outward appearance suggests sustainability, but the underlying reality contradicts these impressions.

It is crucial to understand that greenwashing is not just a single strategy; it is a web of tactics designed to confuse and manipulate consumer perceptions; By stripping sustainability claims of their authenticity, companies practising sustainability are not only making a profit, they are also making a profit; greenwashing compromise the integrity of the movement towards more environmentally responsible practices.

In the following section, we will explore specific examples of these tactics to illuminate the often subtle but damaging methods companies use to project a false image of sustainability;

The environmental impact of greenwashing

Greenwashing is not simply a deception that affects consumer perception; its consequences go beyond the commercial sphere and go straight to the heart of global environmental health; In a scenario where the authenticity of sustainable practices is obscured by the haze of deception, the negative environmental impact of the greenwashing becomes a pressing concern.

• When companies adopt corporate practices ofgreenwashingnot only compromise consumer confidence, but also discourage investment in real green initiatives.
• True sustainability requires significant investments in technologies and processes that minimise environmental impact;
• However, when companies choose to present a false image of sustainability rather than commit to genuine change, a damaging cycle is perpetuated;

The real fight against climate change and environmental degradation requires joint efforts from both the private and public sectors; Investments and resources that could have been allocated to renewable energy, emission reduction and resource conservation projects are diverted when greenwashing is at stake; This diversion of resources to less authentic initiatives contributes to a stagnation in collective efforts to address urgent environmental challenges.

In addition, greenwashing can perpetuate themistaken belief that sustainability is simply a marketing strategy and not a fundamental corporate responsibility to the planet; This misunderstanding can have long-term ramifications in the long run by decreasing the motivation – of both businesses and consumers – to adopt genuinely sustainable practices.

Ultimately,the environmental impact of greenwashing transcends the business sphere and directly affects society’s ability to move towards a more sustainable future.. In the next section, we will examine how consumers can identify and counteract these impacts, thereby promoting authenticity and environmental responsibility;

How to identify practices ofgreenwashing?

Identifying greenwashing in a sea of eco-friendly claims can be akin to deciphering a complicated jigsaw puzzle; However, armed with knowledge and awareness of the subtle signs, consumers can unmask misleading marketing strategies and make more informed purchasing decisions;

Vague and ambiguous terms;

One of the most common tactics of greenwashing is the use of vague and ambiguous terms that sound good, but lack real substance; Phrases such as ‘eco-friendly’ or ‘sustainable’ without providing specific details are red flags; When confronted with such claims, it is crucial to look beyond the superficial and seek concrete evidence of sustainable practices;

Careful reading of labels;

Product labels are windows to the truth behind greenwashing. Carefully reading labels reveals information about the materials used, production methods and overall environmental impact; Paying attention to detail, rather than relying solely on marketing messages, allows consumers to assess the authenticity of sustainability claims;

Third-party certifications;

Third-party certifications are reliable and verifiable seals of approval; Recognised organisations issue these certifications after rigorously assessing a company’s business practices; Search for stamps like the Forest Stewardship Council (FSC), Fair Trade, or Energy Star can help consumers distinguish between genuine claims andgreenwashing.

Sustainability assessment applications;

Technology can also be an ally in the fight againstgreenwashing. Applications designed to assess the sustainability of products, such as GoodGuide or Ethical Barcode, allow consumers to scan barcodes and get instant feedback on a product’s sustainability; These tools provide an additional layer of verification when making purchasing decisions;

Empowering consumers with thekeys to identifying thegreenwashing is essential to drive genuine change towards more responsible business practices; In the next section, we dive into concrete examples of greenwashing, providing a deeper insight into the strategies used by some companies and how consumers may resist these tactics.

Some examples ofgreenwashingat present

Greenwashing is not a phenomenon limited to small, little-known companies; in fact, it has infiltrated some of the world’s most recognised and respected brands; Let’s look at specific cases that illustrate how these deceptive strategies can hide behind seemingly altruistic advertising campaigns;

H&M and the ‘Conscious’ Collection;

Fashion brand H&M launched the ‘Conscious’ collection, promoting it as a sustainable clothing line; However, criticisms arose when it was revealed that much of the collection was still produced using conventional materials and unsustainable manufacturing methods; The ‘Conscious’ collection turned out to be more of an example of greenwashing than a genuine commitment to sustainability, highlighting the need for greater transparency in the fashion industry.

BP and the ‘Green Energy’ Campaign;

Oil giant BP launched an advertising campaign focused on ‘green energy’ and the transition to renewable sources; However, these claims were challenged amid criticism of the lack of real investment in clean energy and the continued emphasis on fossil fuel extraction;

Shell and its commitment to renewable energy;

The Shell oil company has been trying to improve its image through campaigns highlighting its commitment to renewable energy; Although it has invested in solar and wind energy projects, its total contribution to these sources remains minimal compared to its fossil fuel activities; Criticism focuses on the lack of substantial change in its core business model, raising doubts about the authenticity of its sustainability claims;

Volkswagen and the ‘Dieselgate’ Case;

Volkswagen, one of the world’s largest automotive brands, faced a massive scandal known as ‘Dieselgate’; Despite claiming that their diesel vehicles were cleaner and greener, they were found to manipulate emissions test results to comply with regulations; This case not only illustrates environmentally misleading practices, but also highlights how a company can undermine consumer confidence by prioritising its economic interests over environmental truth;

Palmolive and palm oil sustainability;

Companies such as Colgate-Palmolive have been accused ofgreenwashingin relation to thepalm oil sustainability in their products; Despite claiming commitments to sustainable palm oil production, the practices of some of these companies continue to contribute to deforestation and habitat loss; This highlights the importance of looking beyond superficial claims and considering practices throughout the supply chain;

These examples reinforce the idea thatgreenwashing is not limited to a specific sector and underline the need for greater consumer vigilance; Identifying and understanding these cases serves as a valuable tool for consumers seeking to make informed choices and support companies that are genuinely committed to sustainability;

The role of the consumer in the fight againstgreenwashing

The consumer, endowed with knowledge and awareness, becomes a crucial player in the battle againstgreenwashing. Beyond simply being the recipient of advertising messages, the modern consumer has the power to influence business practices and promote genuine change towards sustainability; Here we explore how consumers can play an active role in this fight;

Continuing education;

The key to combating this practice begins with continuing education; Consumers need to equip themselves with knowledge of the common tactics of greenwashing, understand how to read and analyse labels, and know about trusted third-party certifications. Ongoing education is the basis for making informed decisions and resisting misleading marketing strategies;

Research on business practices;

Before engaging with a brand, consumers can take the time to research a company’s business practices; Transparency is key, and companies that are truly committed to sustainability often provide detailed information about their efforts; Consumer reviews, sustainability reports and company participation in environmental initiatives are valuable indicators;

Support for transparent brands;

Rewarding brands that are genuinely committed to sustainability is an effective way to promote responsible business practices; By choosing products and services from transparent companies, consumers send a clear message that they value and support authenticity; This support fosters a business environment where transparency and sustainability are key considerations; In this respect, the annual report Marks with values provides key findings on the appropriate behavior of these companies and the importance of authentic and honest communication to effectively engage audiences.

Expressing concerns through social media;

Social media provides a powerful platform for consumers to express their concerns and share information aboutgreenwashing. Sharing experiences, questions and findings can create additional pressure on companies to be transparent and accountable; Public attention can influence corporate decision-making and promote accountability;

Participation in consumer initiatives;

Joining sustainability-focused consumer initiatives and movements can amplify individual impact; Consumer organisations and groups work collectively to challenge business practices and push for higher standards in the industry; Participating in these initiatives gives consumers a stronger voice and contributes to systemic change;

Ultimately, the informed and active consumer becomes a significant agent of change in the fight against climate change; greenwashing. By exercising their power of conscious choice and advocating authenticity, consumers not only protect their own interests, but also contribute to a more ethical and sustainable business environment;

Responsibility and conscious action are the tools that transform the consumer from a mere receiver of messages to an active participant in building a more sustainable future;

Beyond greenwashingexploring related terms

Greenwashing is only one facet of a broader phenomenon that involves the manipulation of perceptions to advance specific agendas; By exploring related terms, we can discover how such practices are not only limited to the environmental sphere, but also extend to other areas of society and business;

Pinkwashing.

The termpinkwashing refers to the attempt by an entity, whether a company or an organisation, to position its products, services or image as LGBTQ+ friendly in order to gain acceptance or increase sales; Often, this involves highlighting limited advocacy efforts, while internal practices may not reflect a real commitment to diversity and inclusion;

Whitewashing.

Whitewashing relates to the inauthentic or distorted cultural representation of people and events, usually with a bias towards the dominant white culture; In business, it can manifest itself when a company attempts to project an image of diversity and multiculturalism without addressing systemic issues of racial or ethnic discrimination in its organisational structure;

Bluewashing.

Bluewashing refers to the tactic of presenting business practices as socially responsible and ethical, especially in relation to humanitarian and human rights issues; However, it can be a superficial strategy that seeks to improve brand perception without addressing fundamental issues;

Purplewashing.

This term is used in the field of health and medicine to describe situations where a company or product attempts to position itself as committed to mental health and wellbeing, often through marketing campaigns, without a real dedication to addressing underlying mental health issues;

Exploring these related terms allows us to understand that the manipulation of perceptions is not unique to environmental sustainability; Each concept reflects an attempt by companies to project a favourable image, whether on environmental, social or cultural issues, while internal practices may not fully align with these claims;

Recognising these patterns is essential for consumers to make informed choices and contribute to wider scrutiny of business practices;

La entrada Greenwashing: a guide for the conscious consumer se publicó primero en Agencia comma.

We are facing a global paradigm shift, where communication plays a crucial role in this transformation of the financial and investment industry. The rapid evolution of communication requires agile adaptation to emerging trends. However, many traditional brands remain resistant to change, persisting with outdated strategies and underestimating the power of new tools and approaches.

The universe of banking, asset management, investment, financial advice, financing, credit, insurance, trading venues, financial markets… and the communications industry itself will no longer be the same. Are we ready?

Differentiation has become a necessity for all players in the financial and technology ecosystem. If they don’t know you, you don’t exist, ergo you don’t sell. Last year we predicted for the financial sector in our blog that in order to differentiate themselves, brands in the sector would have to implement agile, flexible and proactive communication, capable of anticipating and responding to the needs and expectations of different audiences, both internal and external. We also recommended collaborating for common causes. Have we? Only in part.

The more traditional players focused on institutional business, such as asset managers and wealth advisors, in general, continue to do what has been working for them so far, both in communication and in their business. But the world is changing and what has worked for them today may be obsolete in no time. However, we perceive that they are still reluctant to try new tools, often held back by their internal organisational policies or their size. They are like that ship stuck in the canal. They find it hard to turn. How are they going to catch the technological wave if they are in the first year of digitisation, without knowing how to organise their information and data?

There is still a lack of win-win industry collaboration to communicate together for common causes.

Meanwhile, the new disruptors, mainly technological, appear as saviours with ideas that come to solve problems that are not new, such as democratising access to investment. They show themselves as heroes, pioneers, the ones who will finally solve what no one else could. And, suddenly, they discover that they don’t know what to tell, nor how, nor to whom, and they pretend that, without a budget, communication works magic: to turn into leads that promise that will transform the world.

Although everything is changing, the financial sector is struggling to change. As communication experts, we continue to demand, as my colleague Silvia Albert, founder and CEO of comma, employers’ organisations such as ADC or associations such as Dircom has so often demanded, a higher authority. However, organisations continue to mix the instruments of communication without a score, without relying on a maestro to sit on the steering committee and move his baton so that the corporate narrative is a perfect melody.

So how do we catch the wave of communication that sets us apart in the ocean of technological transformation?

10 key trends for successful communication in the financial and fintech sector

We summarise the essential keys to communicating in the financial and technology sector in 2024

1. Creativity for differentiation. Differentiation requires exceptional creativity. In a saturated landscape, it is essential to highlight the value proposition and competitive advantage. Multi-disciplinary communications teams help to connect those dots capable of creating campaigns that resonate.
2. Coherence of the story in the various channels: As traditional media lose influence to digital channels, consistency of message is crucial. Adapting to different channels without losing the essence is a key challenge.
3. Ability to adapt to changing regulations: With the advent of regulations such as Mifid III – which will bring the end of retrocessions (finally-, PSD3, and the evolution from open banking to open financeand afterthe first European regulation for the crypto-assets market, Mica or the first European regulation for AI, it is imperative to keep abreast of legal changes and adjust communication strategies accordingly.
4. Emphasis on regulatory and ethical compliance. Technology and innovation are ahead of regulations. It is not essential to have regulation in order to act according to good practice criteria. We must anticipate and identify what ethical issues may arise, acting – without the need for spotlights – in a coherent way between what we are and what we do. To this end, communication is consolidated as the strategic and fundamental tool of common sense and as a ensuring the common good through business practice.
5. Ensuring privacy and cybersecurity: in a digital world, privacy and cybersecurity are priorities. Communication must address these concerns when handling and disseminating information.
6. Building trust in a distrustful environment: Lack of confidence in the financial sector and technological innovations is a persistent challenge. Polarity, opinion bubbles and information superficiality do not help, as our report on the Blockchain and digital assets conversation. Honest and transparent communication can help rebuild trust, ensure reputation and visibility, and help build customer loyalty.
7. Proactive adoption of new technologies: artificial intelligence, blockchain and other emerging technologies offer opportunities to improve efficiency and personalisation in communication. The financial sector is very risk-averse, but if you don’t take risks, you don’t win; Proactive adaptation is key and we must apply these tools in our communication strategies.
8. Personalisation of the message: Knowing your audience’s preferences allows you to personalise your message to drive loyalty and retention. Technology facilitates this precise adaptation. The challenge is not to lose the thread of the corporate story. Each communication shall be unique. In addition to the usual channels, there are others: chatbots, streaming platforms, podcasts, webinars, audio, metaverses, video games….
9. Collaboration for causes that seek the common good. Collaboration on campaigns focused on common causes, such as financial literacy or sustainability, can generate positive impact and strengthen brand reputation.
10. Building communities and generating engagement: using technologies such as blockchain to create and value communities, and fostering engagement, involvement and co-creation are key to long-term success. For example, collections of NFTs can be created or transactions can be sealed with smart contracts. Everything remains to be done. Creativity has no limits now.

7 powers of the consultant so that AI doesn’t take your job

Bonustrack, I could not help but reflect on what the tsunami of new technological tools implies for those of us who work in communication. Personally, I think it will allow us a high degree of automation of low value-added processes and we will be able to focus more on thinking and creating.

In order not to be left behind, curiosity and continuous learning are essential. As our colleague says, Roberto Carreras: “AI is not coming to take away our jobs, those who know how to use it will do it”.

Artificial intelligence and automation will enable us to increase productivity and efficiency. According to a McKInsey report, Generative AI could contribute between 5 and 15 per cent of the total investment in marketing productivity, or US$ 463 billion. We will be able to eliminate routine tasks, allowing communication professionals to focus on more creative and high-level strategies.

These will be our powers:

1. Hyperspecialisation The key to adapting to market dynamics and being able to devise communication strategies that make sense and make a difference is a deep understanding of the financial and technology sector.
2. Proficiency in emerging technology: It is urgent to be self-taught, not to close yourself off from learning how to use all the tools at your disposal, and to keep up to date in a constantly evolving environment.
3. Clear and informative communication: One of the consultant’s most special superpowers is his ability to make the incomprehensible understandable. We need to cultivate those skills to communicate clearly and accessibly in a complex financial and technological environment.
4. Creativity and adaptability: creativity and adaptability are essential to stand out in a saturated and constantly changing market.
5. Emphasise public relations: Tell me what network you have and I will tell you what you can achieve; Building long-term relationships based on trust with journalists and specialised content creators does not happen in two days. Our relationships have a lot of value and cannot (yet) be replaced by machines.
6. Ethics: Good professionals must first be good people. Putting the customer at the centre and following ethical principles is essential to building a strong reputation. Practices such as being transparent, not charging hidden fees and even recommending a competitor for a particular campaign will keep customers coming back to you.
7. Data analysis: we must learn to use analytics and data tools to measure the success of campaigns and make informed decisions. This will allow us to create stories from the data; What is not measured does not exist.

Conclusion;

We live in exciting times to constantly reinvent ourselves. The financial industry is going to transform exponentially with new technologies and they will need communication professionals capable of accompanying them on such a journey. Financial and technological communication will experience epic and exciting feats. Keeping up to date, cultivating creativity and constantly adapting are key elements for success in this dynamic industry that will, at least for the time being, prevent our automation.

La entrada Key communication issues for the finance and technology industry in 2024 se publicó primero en Agencia comma.

Within the information bubble around the crypto-asset universe, platforms such as Binance, Coinbase and Kraken resonate as established brands in our minds;

People who seek information about this sector do so through social networks, such as X, mediaoutlets, cryptocurrency blogs and publications, distribution channels, such as Telegram, Reddit or Discord. Over time, these diverse sources of information merge in the minds of consumers to form the perception we have about brands.

In a sector that is so segmented in its sources, which also seeks to achieve to attract public attention, gain credibility and achieve the desired mass adoption, let’s put ourselves – for a moment – in the shoes of a newbie to the ‘crypto’ universe, who is looking to choose a trading platform. After a quick search on the Internet, you will most likely first find the company’s website, the ultimate showcase for its services and products; But how do the major cryptocurrency buying and selling platforms describe themselves, in their own words? What narratives do they use to build their brand and engage users? Below, I summarize the most relevant findings of our report, but allow myself a spoiler: the narratives are barely distinguishable and, with such a narrative, mass adoption will be no easy task.

Discovering the main narratives of the exchanges

First, we proceeded to identify and measure the nine main narratives that form the core brand components of the ten trading platforms under study (Kraken, Coinbase, Binance, Gate, Cucoin, MEXC, Crypto(dot)com, Huobi, OKX and Upbit); These ranged from some of the familiar emotive claims of cryptocurrencies, such as “revolution” and“to the moon”), to more reasoned technical arguments, such as “safety” and “regulatory compliance”; The next step was to group these narratives into four positioning zones that appeal to different user needs and preferences:

1. A new way to make money: appeals to individualistic desires such as financial gain and simplicity.
2. At the forefront: refers to the characteristics and performance of the product;
3. You can trust us: focus on safety, compliance and affordability.
4. Onecrypto platform for all: highlights community engagement and financial inclusion.

We then calculate the coherence of each brand, based on a proprietary methodology that synthesises three proven psychological and social models and allows us to identify inconsistencies, tensions, strengths and weaknesses, as well as to determine the most promising potential positioning; 100% indicates that the brand is totally centred on one positioning zone and 0% represents that the brand is divided into more than one zone; After crunching the numbers, we discovered the following:

Kraken: the undisputed (though not perfect) king of brand coherence

With a coherence score of 56%, Kraken is the leader of the group studied, well ahead of the average of 35%; The brand focuses heavily on simplicity, as evidenced by its slogan “the cryptocurrency exchange for everyone” and the emphasis on its mobile applications;

However, even the leader is not without flaws; In particular, the promise of accessibility and ease of Kraken’s core brand is somewhat diluted by prominent reference to more complex financial products, such as margin and futures trading; Although this offer is clearly separated and has its own brand – Kraken Pro – it does not avoid a certain dispersion, as it is not always clear what is on offer, paraphrasing Don Draper in Mad Men, “I can do ‘where professionals go’ or I can do ‘everyone is welcome’, but not both;

Coinbase and Binance: no distinction in their narratives

If you ask a cryptocurrency enthusiast about the difference between Coinbase and Binance, they will probably say that Binance is known for its global prominenceits new product range and elegant user interface, while Coinbase is more orientedto the US market and – despite recent disputes with the U.S. Securities and Exchange Commission; SECtends to place more emphasis on regulatory compliance.

Given these insights, it may come as a surprise that the narratives of the Coinbase and Binance brands are actually quite similar. Both place more emphasis on technology and product: Binance claims to be the “leader in the ecosystem blockchain“while Coinbase boasts of “powering the crypto-economy”. Both also pay greater attention to the message of boosting earnings with rewards and calls to action to “start earning”; Coinbase is notable for devoting more space to its compliance processes, particularly on its “About” page;

However, in general, both are too broadly positioned in terms of their narratives and not very differentiated; Therefore, despite their apparent differences in their business strategies, these distinctions are not adequately reflected on their websites;

Narrative tensions;

Many of the cryptocurrencies analysed try to combine reassuring arguments, such as safety or regulatory compliance, with a revolutionary feel. As mentioned above, Coinbase is more focused on compliance than most other platforms, stating that “a strong compliance foundation” is central to its mission; Instead, in describing a mission to “increase financial freedom in the world”, Coinbase offers a vision of a global economy that operates on a common set of rules that cannot be “manipulated by any one company or country”; This combination of regulatory compliance and crypto liberalism creates a confusing overall picture;

One detects another common narrative conflict when highlighting platform features such as simplicity and accessibility, geared towards newcomers, while boasting the possibility of leveraged trading, liquidity, execution architecture and other advanced technical features.

The great untapped opportunity in branding and communication in Web 3

Branding and communication represent a huge untapped opportunityfor companies operating in the ecosystem of theblockchainand Web 3. While leading traditional and Web 2 companies continue to redefine the meaning of brand recognition and engagement, web 3 branding has been largely underutilised, as well as its communication strategies. Instead, companies often resort to a limited handful of communication and marketing tactics that have proven to be sufficient only to target niche audiences;

Cryptocurrency platforms have been practically forced into a relentless game of attracting newcomers through brand name recognitionachieved through high-profile associations with any other established brands, such as sports teams or celebrities. This scattershot approach has been driven partly by the notorious boom and bust cycles of the market and partly by cut-throat competition; But history teaches us that brand recognition alone does not generate long-term value, and crypto exchanges are struggling to find a coherent narrative that will hold up in lean times;

Conclusion: work on your brand and your communication

If mass adoption is the goal, the sector ofblockchain, digital assets and Web 3 needs a better way to reach global audiences.. As with the first iterations of the Internet, this will only happen when companies start building brands with global appeal; And for this there is nothing better than to surround yourself with the experts in branding and communication;

When it comes to brand personality, you need consistency; You can’t be openly rebellious and at the same time follow the rules to the letter; The brands of some cryptocurrency trading platforms look more like a collection of headlines and statements than a company with a deliberately crafted identity;

Our findings suggest that crypto exchanges could benefit from clarifying their core values to paint a more coherent picture of their brand; They also point to a lack of strong global communication strategies;

*Article written by Germán Ramírez, co-founder and Chief Relevance Officer of The Relevance House

La entrada The untapped potential of branding and communication in Web 3 se publicó primero en Agencia comma.

This market player also had an exceptional ally: social channels, which allowed individual investors to communicate, organise and launch joint investments, wresting billions of dollars from the bottom lines of Wall Street hedge fund giants;

The changes brought about by retail investors

Players in the sector are trying to decide whether this phenomenon will remain a passing fad or whether the hypothetical new paradigm will be consolidated, despite the fact that the current investment context is diametrically opposed to that of the Covid-19 pandemic years. Whatever the outcome, it has become clear that retailers have brought about irreversible change;

One of them is the intervention of market supervisors around the world in the contents of social networking sites (SSNs) and their willingness to discipline and tie down the so-called influencers. An unprecedented act in which they have crossed the red line of any interference in freedom of expression;

Retail investors lose money

Obviously, regulators must be presumed to be in good faith; It is equally obvious that in their warnings and requests for information to alleged financial gurus on social media – so far they have not taken action in Spain – they have acted out of a mission to protect small investors, given the speed with which they are burning their portfolios;

However, the figure of retail investors who are in losses has been public since 1 August 2018, when the European Securities and Markets Authority (ESMA) undertook a major regulatory overhaul which obliged regulated brokers in Europe to report quarterly the percentage of negative accounts; Statistics show figures of up to 90% of proprietary traders’ balances in the red on some of these platforms, while the minimum percentage of losses is around 65%;

That most retail investors lose money is an acquired wisdom of the financial markets; But it is nonetheless true:

• Some studies by market authorities ofUK and USA show figures that are similar to the European figures and confirm that this is the case for 85% of the traders.
• In the world of Forex (Foreign Exchange Markets), more than 95% of first-time investors blow up all their capital in the first year and a study by the Securities and Exchange Comission (SEC), from 2011, revealed that 70% of foreign exchange traders are making a loss every quarter;

Retail investors and gurus, an inherent binomial of thetrading

The vulnerability of the inividual traders is more than evident in the light of the figures; This has not gone unnoticed by the market, as it has traditionally been an opportunity to generate business in the form of education, training and mentoring especially for individual investors;

Most trainers, either on their own or through broker programmes and industry media, have embarked on this task with a genuine desire to support retailers; And many of them are backed up by success stories and more than 20 years of experience in working alongside the traders.

Specialised media and networks of forums and blogs have played – and continue to play – a fundamental role in theeducation of the retail investor community over the years; Retailers have traditionally clustered around these spaces, where they have also helped each other;

Retail investors victimised by scam traders

But there has also been a proliferation of so-called scam traders, that have used empty promises of returns of up to 100% per annum as a hook, asPaco Lodeiro of Academia de Inversión warned back in 2017.

There has been no shortage of scandals, some of them as notorious as the case of Josef Ajram, who went from trading star with ‘The Ajram Method’ to give up the management of its own SICAV in 2018, with losses in the millions. Others, far from the media spotlight, have also long used the aforementioned channels and, in recent years, have found inYouTube, Twitter, Instagram or TikTok an exceptional loudspeaker;

While they arouse distrust and suspicion in equal measure among more experienced investors, who can spot the trap and the cardboard in messages that are almost always full of promises of immediate wealth through shortcuts and little effort, this is not the case for less experienced investors; And not to mention among newcomers, who are oftencentenials, digital natives who are easily swayed by these siren songs;

In short, the trader and the guru -or the expert- interact on social channels, blog communities and forums for years, in a sort of ecosystem as old as retail itself, in which predators have always existed. So why has the Spanish Securities and Exchange Commission (CNMV) not taken action on the matter until 2022, when it conducted a review of investment recommendations issued by influencers”?

So far we have argued several points; Let’s recap:

• The relationship between experts who offer investment advice and retailers is as old as trading
• Individual operators and these experts have been linked in social communities that are some 20 years old – remember that Facebook, for example, is only available in Spanish in 2008;
• Misleading investment advice has previously coexisted with genuine training and support proposals;
• The vast majority of traders incurs losses and this data has been public for about five years;

The CNMV and social media

It goes without saying that the supervisor constantly executes its investor protection mission, which we have already discussed, by virtue of which it can issue warnings to the public. However, their actions are often targeted at entities that perform investment services, although there are not few cases of fines to individuals -recently to the journalist of ‘El Confidencial’, Agustín Marco– when, for example, they have made use of privileged information to make a profit. Legal sources confirm that there are no records of warnings or interventions in investment bloggers’ forums or communities;

In fact, even the case of the warning to the footballer Andrés Iniesta by the advertising of the crypto-asset platform Binance in its social media, at the end of November 2021, there is no similar performance in living memory, according to the same sources; This gesture resulted in the publication of a Circular on crypto-asset advertising submitted as an investment object, in January 2022, which entered into force in February; And with it, the CNMV was a pioneer among financial market authorities worldwide;

Months later, on 24 October, the CNMV issued the unprecedented communiqué on the review of the social media activity of the influencers in the financial sector, to avoid “conflict and unfair competition with regulated entities that issue recommendations”, according to legal experts consulted. In this sense, these sources indicate that the regulator is indifferent to the medium used to disseminate these messages, although they recognise that it blurs the boundary between the activity of professionals and freedom of expression.

Influencer: advertising or content?

Other experts consider this scrutiny to be a “good thing”, such as Alberto Muñoz, vice-dean of Academic Organisation at the UNED; “Many times the so-calledinfluencers can convey the wrong messages, even out of sheer ignorance of the markets”. At other times, they are “misleading or, worse, biased by their own interests”, as they often have arrangements with brokers and go so far as to “incite account opening and encourage trading, which can be negative for certain types of investor”;

Brokers are becoming increasingly bold in their social media practices in order to attract clients; There are more than a few cases of these influencers knowingly publishing scams or misleading information, such as…; the repentant Ben Armstrongone of the youtubers with a crypto-themed channel with the most followers ‘BitBoy Cripto’who acknowledged accepting payments from crypto companies to promote his new products to his audience of subscribers; Last autumn, news also emerged of the U.S. SEC fining Kim Kardashian $1.3 million, afterconcealed a charge for promoting a cryptocurrency.

Retail investors, social networks and lack of financial education

At the same time, the emergence of new social platforms has led many gurus and trainers “to adapt their messages to the language of the new channels, which means that these interactions with audiences tend towards simplification and superficiality“explains Pere Monguió, head of content at FXStreet.

In turn, “it has made them mainstream, as they have transcended their traditional communities to reach a mainstream audience,” he argues, who are financially uneducated, and easily succumb to speculative activities driven by YOLO (you only live once). “Social mediainfluencer perhaps has less knowledgeable or less experienced than the blogger, talk-show host or columnist before; But it beats them all in its ability to synthesise messages and connect with its audience,” he says;

All of the above gives the CNMV reason to “try to put things in order”, Muñoz says, although “it may have arrived late, but the law always seems to lag behind technological advances”, he regrets;

In fact, the CNMV communiqué was published one year after the ESMA statement on investment recommendations on social networks. It specified that “dissemination channels can be analyst reports, articles, traditional media or even social media”, providing scope for expanding the framework for action by European supervisors;

The awakening of the force… of retail investors

Internal market sources consulted, however, approach this complex issue from another point of view; Turning to the question of why the CNMV has not taken earlier or even more severe measures, they claim that the entity maintains a moderate concern on the public activity of the investment influencers , as the real focus of the regulator lies in another derivative of the whole phenomenon we have been analysing;

Let’s go back to the origin, to the Gamestop case; The ability of a group of retail investors to coordinate to beat the big Wall Street hedge funds to the punch, through a sub-forum onReddit, WallStreetBets, was a point of no return in financial markets. It triggered a phenomenon of orchestrated trades in other securities known as meme stocks that traders made viral through these forums, as well as other social platforms; And it showed the power of organised small investors to turn the tables in their favour, something that frightened institutional traders and the authorities;

The epicness of the whole story is a new twist on the eternal David versus Goliath; The investment giants received a real blow that put the spotlight on this ecosystem, which has already been explained in detail, and which had more or less passed under the radar; But those communities of bloggers had become more sophisticated and had almost doubled in size. Retailers’ market share in the Spanish market in 2020 was up to 7.7% and 6.7% in 2021, compared to just over 4% in 2019;

Retail investors and the democratisation of trading

In addition, they were able to organising and making joint decisions as activist investors. This new reality is keeping regulators and institutional traders on their toes, keeping a close eye on the entire digital information-sharing infrastructure that the retail investor movement uses to communicate through platforms such as Telegram – where there are investment channels with thousands of members -, social networks and geographies;

Thus, what really keeps market supervisors on their toes is whether orchestrated episodes of stock-pushing are occurring, to the benefit of the retail community as a whole, or of an isolated sector that engages in a practice ofpump and dump, and destabilise the market; Or maybe what really keeps them awake at night is the reversal of what they consider to be the natural order of the market?

All of the above leads us to conclude that intervention in the influencers and social media is just the tip of the iceberg in a kind of cold war between the institutional investment industry and the democratisation of trading. We are sure to see more hostilities between the two sides in the future, if the market conditions of 2022 and 2023 do not kill the appetite of the individual traders. And we are concerned that the boundaries of freedom of expression and even privacy continue to be stretched; We will stay tuned;

La entrada The control of social media influencers, trading tips for retail investors and freedom of expression se publicó primero en Agencia comma.