As an object, this article is about opening up our readers and the general public to the new development taking place in the Capital Market, and that is the emergence of a new market segment from the clientele side, one which has been called the Retail-End Market Segment (by non-experts). The interesting thing about this new market development is that it is strange to the market it is being grafted in every sense of the established industry rules, character and trade model. Yet, it is almost fully integrated.
To mention, however, the editorial team’s decision for the changes in the capital market altered the editorial plans earlier agreed for this week, in that we had agreed to follow-up on the need to re-view the details of institutional efforts at setting the agenda and tone for public conversation of and for Consumer Rights Protection with all its global responsibilities and implications. Our readers may have been conversant with the premise of our position for the need to deepen the conversation for a more inclusive participation of driver-stakeholders, if we must actualise a purpose-driven and effective investment of needed resources for tangible gains of the campaign for consumer rights protection. Where we are presently leaves so much yet to be achieved.
And it all bothers on effective communication. Communication, as a process, leaves an inexhaustible expanse of possibilities for communicators to draw from, from the point of planning, through execution to effectiveness check. That is why communication rests on strategic planning. As communication consultants, we have spent all our professional lifetime so far, digging into conventional and innovative theories, principles and ethical guidelines trying to improve of effective communication. So, our plan was to treat the theory of Cognitive Dissonance as an underling factor for Communication, and a critical element in the process of developing communication strategy, if we must make the needed impact for positive change – societal behaviour and attitude-change among a defined audience. It promises to be an interesting topic, for all the expository and exciting reasons.
But we had to make this alteration for the new development in the capital market, which we thought should be quickly dealt with for the purpose of drawing the public’s attention to what is rather deepening as a social life style.
The Capital Market
Google definitions says (paraphrase – mine) the capital market is a financial market place where long-term debt or equity-backed securities are bought and sold. In essence, it is a form of business engagement that channels savers’ wealth to those who can put them to long-term productive use. As a rule, therefore, owners of investable or invested wealth part with that which they own, for a profit; basic end-to end description. An explanation of this defined market refers to it as that set of activities “…that gathers funds from some entities and makes them available to other entities needing funds” (investopedia.com)
So, we are looking at a market where Wealth is the key factor; it is either you have it to invest or make available to those who have the capacity to earn your trust, invest your wealth and make profit for you, or you are strong enough in character, professional competence and personality profile to get wealth owners leave their priced possession with you, in trust that you will deliver on their expectations. All of those speculative (backyard bargaining) naturally laid down the characteristics of the ‘market’. Among the predominant of operative characteristics are: financial net-worth, literacy level, size of financial network, socio-economic position (extent of sophistication), and over-all exposure. Suffice to say, these characteristics are definitive and highly discriminatory in shaping size of this market. Clearly, there are groups which membership should just respect themselves by staying away, not minding whether some among them show spark of aspirational participation.
So, in my early years, way back in secondary school/early tertiary institutional days, references to institutions or financial settings such as the stock market was way out of my considerations. As the level of education grew, knowledge of such institutions grew, but not the interest, a lot owing to those particular characteristics stated above and the financial background guiding my growth process (I respect myself).
Fast-forward to my early years in career building/growth, when market classifications made more meaning, especially by reason of theoretic application in service to those of my clients in the financial market. My then general manager, Mr Georgie Umunna, introduced the concept of Penny Market in one of our strategy sessions, pointing to the direction of the low-value, huge volume earners’ bracket in socio-economic stratification. It was essentially an expose to the good side of the Bottom Of The Triangle in the psychographic structure. The import of the session was to guide business managers on how to mop-up what he called the penny market, giving meaning to the good side of the ‘poor population’. He had just lunched then-Unilver’s brand of seasoning, Royco. So, his teaching was a relation of his experience at his last major task as a Brand Manager, before moving on to the Agency side as the team leader. That learning is true today.
The decade, 1990 – 2000, rushed with varying feel of economic developments till where we are today. The dwindling economic developments leave strong impact on investment decisions and practices, across markets. More and more, business managers are quickening their pace in innovative reasoning for cost control and profit optimisation; the dynamics are changing and established practices are making way for new learning/experience. Some of these changes have caused catastrophic damage, but by-and-by, survival and growth is constantly challenging resource management and placement for at least marginal growth
Perhaps the technological advancement in communication (specifically telecommunication or the GSM) quickened the drastic change in the capital market, or perhaps it is the market operators’ turn to make-manifest the ingenuity in change actualisation, perhaps again, occasioned by the economic challenges, the strict barriers that ensured that exclusivity of participation, have all come crumbling before our eyes. No mistakes, the class of high net-worth individuals and institutions that traditionally drive the market have not reneged nor disappointed in their performance, but what I think is that the market is re-shaping with the tide of wealth distribution, population re-classification and the increase exponential expansion at The Bottom Of The Pyramid.
Therefore, today, the investment market is no longer the exclusive club of the high net-worth, and the profile reflecting the market characteristics, by which new entrants can play. As we notice (and consequent upon the changes in market definition and rule-book, a new market segment has emerged in the capital market, and that is what we have called The Retail End Of The Capital Market ©. The criteria have been revised to accommodate low-value, high-volume earners, aspirational investors, social media participation and the will to ‘survive’ driven by the determination to grow own-wealth by investing the very little available.
Daily, new brand-Apps are launched by institutional and new market operators, competition is stiffer, the aggressiveness at brand building and competitiveness among the operators is almost becoming market cannibalisation, and the heat is on. Interestingly, it is no more coffee-in-the-office time for investment managers, as they are constantly at work for clientele base expansion, either physically or by aid of technological applications.
Our position is for breaking barriers, and hence this piece; allied institutions and stakeholders should contribute to sustain this new market evolution, as it holds promise for wealth generation and redistribution. It is, to us at MC&A DIGEST, the true meaning of financial inclusion (not those self-serving automated commercial banking services that have been structured to be revenue-generation services).
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