In November 2018, Dominic Raab resigned as Brexit Secretary. But this wasn't your run-of-the-mill resignation. There was no discreet briefing as the minister headed into Number 10. Instead, he bashed out a quick tweet, with a photo of his resignation letter.
Raab’s guerilla tactics encapsulate the reality of politics in the Internet era. You only have to look at the prominent role that Twitter is playing in the upcoming US election to see that social media has changed the rules of engagement irrevocably. The degree to which it is impacting the political landscape is truly astounding.
Those who downplay the impact of social media on politics – and indeed the wider economic and social context in which we live – do so at their peril. In order to operate effectively in volatile conditions, finance professionals need to understand the significance of social media and the pivotal role it plays in political life.
Politicians are increasingly abandoning traditional methods in favour of more direct and authentic ways of engaging with voters – both supporters and non-believers. Many have become adept at leveraging social media to tell stories, antagonise opponents and dramatise their policies. Others aren't very good at it, but still feel that they must try.
Not even a pandemic can disrupt the antics of this new breed of storytellers. Town halls and party rallies have been replaced by tweet-storms, AMAs and even online gaming sessions, so the impact of COVID-19 on the ability of social media power users like Donald Trump, Bernie Sanders and Alexandria Ocasio-Cortez has been limited. Indeed, the pandemic has actually improved their ability to engage with the public, since it has increased demand for political leadership and heaped scrutiny on the role that our leaders are playing in the fight against Coronavirus.
Trump is the most infamous proponent of social media in high office, live-tweeting his presidency at all hours of the day and night. And he is very good at it. He even includes intentional spelling errors in his tweets, presumably to create empathy with voters who crave a less polished, more authentic voice from their leader. Say what you will about “The Donald’s” behaviour, this is a guy who knows how to resonate with his base.
How did we get here? The answer is pretty simple; people tend to get their news from social media. Here in the UK, half of adults now use social media to keep up with the latest news. In a world where time is money – and political capital is spent quicker than ever before – Twitter will always triumph over newspapers and The 10 O’Clock News. For good or ill, social media speeds everything up. Stories that took days to play out now unfold in a matter of hours. It’s fascinating, scary, exciting, depressing, and sometimes (albeit rarely) uplifting.
But it’s not just about convenience. It’s about context. When we consume news via social media, we get to see how others react to the same story in different ways. Being immersed in person-to-person dialogue, either as an active participant, or a “lurker”, makes us feel like part of a community. This type of social feedback, and the likes, comments and retweets that come with it is moreish, and leads to yet further engagement.
When a story reaches critical mass, it becomes self-sustaining. In this way, Twitter shouldn’t be characterised as live reaction to events happening in the real world, raw news ready to be packaged up by professional journalists, intellectuals and ideologues. Rather, it is the news, in its most basic and engaging form.
Twitter’s rise doesn’t mean that traditional news media is dead. Our newspapers, television shows and radio programmes simply play a different role in today’s political landscape, acting as an interpretive layer rather than a source of raw information. “Slow Journalism” outlets such as Delayed Gratification (“the world's first Slow Journalism magazine”) and Tortoise (“for a slower, wiser news”) have recognised this and are well positioned to benefit as the trend accelerates.
Once upon a time, political dynasties could be forged with briefings, press releases and stage-managed public appearances. Not any more. Politics has become more volatile, unpredictable and risky, with profound knock-on effects for markets. In order to effectively manage these risks, finance professionals need visibility. This means consuming information from a range of sources. Twitter is a crucial and oft-overlooked part of the wider media landscape. Crucially, it is a primary source relied upon by journalists to amplify flash-in-the-pan stories and construct overarching meta-narratives.
John Maynard Keynes noted with his famous “Beauty Contest” thought experiment that investors shouldn’t price shares based on what they think their fundamental value is, but rather on what they believe everyone else thinks their value is. Quite simply, Twitter enables investors to gain a deeper understanding of what the market is thinking, and how the news cycle will play out.
Social media presents huge commercial opportunities to those with an open-mind and a willingness to engage. Yes, social media is chaotic and overwhelming at times – but exciting new curation tools and techniques are emerging that make it quicker and easier to discern signal from noise.
We created EarlyBird for precisely this reason, bringing Twitter to the trading floor in a safe, smart and compliant manner. More than half the top 20 global investment banks are using our product. If you would like to join them, please get in touch and we’d be delighted to explain the benefits in more detail.
Posted on 10/26/2020 3:25:14 PMEarlyBird News