By Ted Harvey, Account Manager.
Every year throws up a handful of memorable events that unfold in the financial markets, but one always stands out above the rest. If 2020 was the pandemic triggered rout in markets that occurred in March and 2019 was the collapse of the Woodford investment empire, then 2021 will most likely be GameStop.
While the forces behind the ‘short squeeze’ in the GameStop (and AMC, Nokia, Blackberry, Bed Bath and Beyond) share price are still at play, the fervor that has gripped retail traders and the onlooking public cheering them on has somewhat died down. With the value of GameStop shares and now silver falling, there are signs that the concerted push to increase the value in unloved assets is over (at least for now). Looking back at what unfolded there are communications lessons to be learned from this classic David vs Goliath story.
Amidst the chaos and the volatile share price, representatives from both sides came out to throw their ten cents into the mix. On one side there were the Wall Street institutions, critical of the disruptive effect the retail traders were having on the stability of the market. On the other, there were the r/WallStreetBets inspired traders, taking the fight to those they believe have rigged the financial system in favour of the establishment. It’s certainly arguable that both were right, but one side generally did a far better job of communicating their point of view.
While this story has gone global, the vigilante attitude is currently playing out in the US. This doesn’t mean that the themes in this story are not relevant elsewhere, though. The same countercultural themes exist a bit closer to home in the UK’s financial services/capital markets. Take, for example, startups and fintechs. London is currently a leading hub for this type of company, with many specializing in providing services to firms operating in the financial markets. Upon hearing these words, the image of a young, progressive company utilising a range of new technologies to disrupt the status quo springs to mind. Present in the idea of these companies and the work they do is a countercultural attitude seeking to shake things up.
From a communications standpoint, GameStop highlights the value of understanding and tapping into these countercultural elements in a startup’s PR, especially in the early stages of the process to build a company’s brand. Reaching your audience with your business’s value-add messages is critical for achieving your objectives. But, on the biggest topics of the day, going against the grain in the media can provide you with opportunities to stand out from the rest of the marketplace and have your voice heard.
No one will have paid much attention to the stream of analysts and market commentators on TV or in online publications following party lines and repeating the same criticisms of the mechanics and the intentions that drove the GameStop episode. Given the broadly popular public sentiment mirrored on r/WallStreetBets, the poorly informed criticisms came across as tone deaf.
Refusing to take part in the circus of public opinion on matters such as this is understandable, as is not wanting to be seen as a troublemaker. However, treading the fine line between the two sides and navigating these stories carefully in your PR, bringing together your company’s values with the countercultural themes present in the GameStop phenomenon, is a sure-fire way to generate positive exposure, especially if your business is disruptive by nature.