Media Intelligence and PR Spend Up 3 Percent To $2.2 Billion

Burton-Taylor International Consulting, best known for their reports on market data and comparison rankings of Bloomberg and Thomson Reuters, have published their second annual ranking  on social media. It shows social media demand up over 20 percent. HootSuite & Radian6 remain largest social media monitoring providers

The 2013 global spend for media intelligence and public relations information (including regulatory disclosure) and software was up 3.10 percent over 2012, reaching $2.20 billion.  At 12.65 percent, the UBM-PR Newswire unit remained the overall market share leader, while Meltwater passed Cision to become the second largest player in what has become an active industry for acquisition, divestiture and recapitalization.
 
The 71-page report sizes the overall market and key segments globally and regionally, delivers market share and profile data for leading players, calculates segment growth rates and details market share evolution.
 
The study shows that Meltwater, NASDAQ OMX (which bought the Thomson Reuters press release distribution business last year) and Kantar Media delivered the industry’s highest five-year growth rates.  The report also shows that demand is gaining momentum, as overall spend in the industry has grown at a compound annual rate of nearly 6% the past three years.
 
“Organizations will continue to turn to PR agencies for help with fast-changing areas, notably social media,” said Douglas B. Taylor, managing partner of Burton-Taylor.  “However, this is being balanced by a move toward insourcing, driving increased demand from corporations for vendor tools to help with time-consuming monitoring and analysis tasks”.
 
“The market is going through significant change,” said report contributor Chris Porter, director at at Porter Walford Consulting.  “With Vocus accepting an offer from private equity firm GTCR in April 2014, Meltwater launching a counter-bid to acquire Cision, and many other top-tier vendors facing potential new ownership or changes to capitalization, the industry is one of the most active globally.”
 
“After the strong demand for last year’s Burton-Taylor report, we are particularly pleased to offer this important 2014 version which includes the addition of ‘Company Market Sheets’ for Kantar Media and Precise Media and new data on fast-growing social media monitoring vendors such as Brandwatch, as well as significantly expanded detail from the growing Asia-Pacific region,” added Taylor.
 
The Burton-Taylor Media Intelligence and Public Relations Information & Software Global Share & Segment Sizing 2014 – Key Competitors, Global Market Share 2013, Global Segment Sizing 2013, Global Market Trending 2009-13, Global Segment Trending 2009-13 report may be purchased by visiting http://www.burton-taylor.com/consulting/research-full.html or by contacting orders@burton-taylor.com, +1 646 201-4152.

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Michael Lewis Flash Boys Impact Finance Stocks — KBW

KBW analysts have published a report focusing on the potential fallout on capital markets and market structure stocks from any changes in the current regulatory environment following the increased focus on high frequency trading (HFT) and payment for order flow (PFOF) as a result of the publication of Michael Lewis’s book Flash Boys.
 
Stocks in their coverage universe that are associated with these business practices have declined by an average 7 percent since the market close on March 28th versus a 1percent decline in the S&P 500. While KBW believes that both practices are likely to come under heightened scrutiny by regulators, they believe that any potential changes will involve a relatively substantial overhaul to market structure regulations, making this a longer-term event.

In KBW’s view e-brokers have been the most impacted by payment for order flow (PFOF) — the stocks are down an average of 10 percent “despite the fact that PFOF was referenced only a handful of times in the book.” But Lewis described TD Ameritrade’s negotiations with brokers, always over dinner in Omaha, never anything by phone or email, as worth several hundred million in broker fees. Charles Schwab didn’t have any clue how much more it could have made from brokers, said one insider.

“The market structure stocks, which are more directly linked to HFT, are down just 7% on average. While these two issues are tied together through the current market structure in the U.S., we argue that they are two separate issues. AMTD and ETFC would be the most impacted by any restrictions on PFOF, in our view.”

From the report:

“Headline Risk Could Weigh on Exchanges & Specialty Brokers: We believe NDAQ and CME are the public exchanges that could be most negatively impacted by a reduction in HFT. KCG also operates HFT desks in several markets, but could be more negatively impacted by rules aimed to limit off-exchange trading, in our view. While we think the path to regulatory change could be long, headline risk could continue to weigh on the group”

NASDAQ comes in for particular criticism for creating a variety of order types that were tailor-made to allow HFT to pick off investors.

KBW must be a model of politeness:

“We expect the SEC to act deliberately and methodically in reviewing Reg. NMS and HFT.” These problems have been around for years and the SEC has done nothing. Lewis suggest one possible reason — more than 200 staff left the SEC to join high-frequency trading firms, so a lot of the regulators have a stake in HFT success. Jeffrey Sprecher, CEO of ICE, has spoken out on market structure, saying the U.S. has too many exchanges and he doesn’t particularly like payment for order flow. But Lewis writes that ICE tried to buy IEX, the new exchange which was developed to prevent HFT from gaming the system. The SEC probably won’t do anything too quick– HFT is worth somewhere between $10 billion and $20 billion. But if the pressure builds one fast change would be to end the maker-taker payments for orders. Of course, that could knock the valuations out of several exchanges.

 

 

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American Financial Institutions Nudget Into Positive Trust Territory

 Thomson Reuters has announced the latest results of its proprietary TRust Index, showing that first-quarter 2014 trust sentiment in the Top 50 Global Financial institutions as a whole remained steady, but negative.  However, institutions from the Americas started the year well, ending with the first positive trust score of any region since the Index was launched a year ago.

That, of course, was before the publication of Flash Boys by Michael Lewis which doesn’t depict the U.S. investment banks or exchanges in a positive light at all.
 
Tracking trust through news sentiment shows that the Americas institutions followed by the TRust Index crossed into positive territory to end the first quarter with a trust score of 2 percent (-1.85 percent Q4 2013), due in part to increased profits at Canadian banks.  This compared to a -1 percent score for the Top 50 Global institutions as a whole (-1.75 percent Q4) and -2 percent for both Europe (-1.25 percent Q4) and Asia (-1.5 percent Q4).  In Asia, decreasing trust was partially attributable to tightening credit conditions in China, while European financial institutions experienced a decline in trust due to continuing investigations around interest rate fixing, rigging of exchange rates and tax fraud.

Imagine that such things would have an impact!
 
“During the financial crisis, and since, Canada has been noteworthy for the policies and discipline that allowed the country to better weather the storm, and its financial institutions to more quickly recover,” said David Craig, president, Financial & Risk at Thomson Reuters. “It is no surprise therefore to see Canadian banks leading the Americas region into positive sentiment as we measure trust in the Top 50 Global Financials for the 5th consecutive quarter of the TRust Index.”
 

 

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NCR Made 9 worst CEO list too

7. Bill Nuti
Company: NCR
CEO rating: 39%
Company rating: 2.5
Years as CEO: 9
Number of employees: 29,300

NCR Corp. (NYSE: NCR), based in Duluth, Ga., produces ATM machine technology, bar code scanners and other devices used in the sales process. While the company’s revenues grew to $6.2 billion in 2013 from $6.0 billion in 2012, employees showed a strong dislike of their CEO, Bill Nuti (pictured right). One of the most common complaints among current and former employees on Glassdoor is that under Nuti, people can be called to work on a moment’s notice at any time during the week. They also criticized upper management for maintaining a structure in which decisions are based on cronyism, rather than what’s good for the company. One current employee, while commenting on Glassdoor, wrote to upper management, “We carry your water every day, and you disrespect us every day, we’re just your minions. You put out surveys, obviously you pay no attention to them or things would begin changing.”

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Fiserv CEO Ranks Among 9 Worst

8. Jeffrey Yabuki
Company: Fiserv
CEO rating: 39%
Company rating: 2.5
Years as CEO: 9
Number of employees: 21,000
from Huffpost
Employees of Fiserv Inc. (NASDAQ: FISV), which sells information technology and e-commerce products, were resentful of layoffs due to frequent M&A activity. The company has acquired more than 140 acquisitions since it was founded in 1984, with the most recent being the 2013 acquisition of Open Solutions. The biggest criticism of the company under Yabuki’s direction is how frugal it is with compensation, according to comments on Glassdoor. Employees also felt that the company’s upper management does not listen to employees’ ideas on how to improve the company. Some former employees who commented on Glassdoor said that Yabuki is disrespectful to the company’s workers, claiming he once said, “If you don’t like the way we do business, there’s the door.”
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Europe’s Largest Sharia’a-Compliant Bank Chooses ClusterSeven

The Bank of London and The Middle East (BLME) has selected ClusterSeven for its enterprise spreadsheet management to provide controls for its key business spreadsheets and the data they manage. BLME, an independent UK, wholesale bank based in London, is the largest Sharia’a compliant bank in Europe. Its  core divisions are corporate banking, treasury, and wealth management  which includes private banking and asset management.

ClusterSeven’s end-user computing management solutions enable financial services firms and other leading institutions to maintain the transparency and integrity of their spreadsheets and data files in order to increase productivity and business insight and to reduce operational risk.

“The understanding and control of spreadsheet activity we get with ClusterSeven allows us to improve our operational controls and governance,”  said Paul Gospage, chief operating officer at the bank. “These include better data quality, lower manual costs, and better insight to inform our IT development plans.”

Ralph Baxter, CEO of ClusterSeven, said that many high value and specialist business activities are dependent on spreadsheets.
“Increasing emphasis on risk management and data quality has exposed spreadsheet management as a major opportunity to reduce operational risk and deliver efficiencies.”

ClusterSeven was founded in 2003 and now has a third of the world’s top 30 banks as clients.

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Customer centricity in banking moving to the forefront

By Tom Groenfeldt

Customer centricity is moving from a banking industry buzzword to reality as bankers turn to important new technologies, such as big data and real-time customer analytics, to improve the customer experience.

A 2013 survey by Bloomberg Businessweek Research Services (BBRS) of banking executives around the world found that well over 70 percent thought that customer centricity is very important. Improving the customer experience by looking at their products and processes from the customer’s point of view and need is considered an important strategy to reduce churn, increase revenues and otherwise impact both the top and bottom lines.

The reason it is important is clear: A recent Accenture report said banks could lose 35 percent of their revenue by 2020 and up to 25 percent of US banks could simply disappear. Customer loyalty is often only as real as the convenience of a local branch. Close the branch and the customer could move to other banks with a close-by branch or to a virtual financial provider with no branch overhead at all.

However, much of bankers’ energy, not to mention IT budgets, has been directed at meeting new regulatory requirements. As compliance projects are completed, bankers now have the time and resources to improve customer experience through more targeted, personalized service.

“Now they are launching initiatives with customer dashboards and portals where consumers can get a more customized experience online,” says Christine Barry, research director at Aité Group, a financial services analytical firm.

Not easy to achieve

Customer centricity is not easy to achieve on the aging, inflexible legacy systems that many banks have. Only 55 percent of the bankers surveyed said they can analyze their current customer activities such as deposits, withdrawals and payments. Far fewer are able to analyze their customers’ social media sentiments. Note that this ability can yield important information about personal preferences and life events that have financial impacts, and channel preferences.

Bankers know it is easier to sell new products and services to existing customers than to find a new customer, but they have been slow to act on the knowledge. The BBRS survey found that only 29 percent of banks could analyze customer wallet share, one of the key measures of a firm’s relationships with its customers.

Some banks show what can be done with data. PNC is using the bank’s own customer information, plus outside data on online purchasing and investments, along with social media to define segments for its customers and prospects. Then it goes to social media “publishers” to buy appropriate exposures for the segments in a digital-first marketing strategy.  It knows that a 24-year old recent college grad and a 35-year old mother of three may both interested in vacations, but different types of vacations. And it knows they are apt to log on to entertainment or travel sites at different times of the day. Having developed short videos for each segment, PNC can reach them with an informal, humorous approach at the right time on the right social media site and then track the results. For more information, click on this link: http://www.forbes.com/sites/tomgroenfeldt/2013/11/25/pnc-goes-digital-first-in-marketing-to-the-tech-savvy/

Better targets

Cleveland-Based KeyBank is using transaction and other data to provide targeted offers and advice. It also uses data to staff branches more efficiently and figure out where new locations would be successful as more customers shift to online and mobile. Just changing staffing and hours at its branches saved $35 million in one year. For more information, please visit: http://www.forbes.com/sites/tomgroenfeldt/2013/06/03/keybank-moves-to-data-driven-decision-making/

Commonwealth Bank of Australia monitors social media 24 hours a day for service issues affecting its own customers. It also watches for complaints about competitors. It is quick to send a message to unhappy customers of its Australian rivals suggesting they move their accounts to CBA.

Achieving this sort of customer centricity requires managing the huge volumes and varying types of data needed to understand customers across their banking, social media, mobile apps and the Web. Yet 40 percent of the bankers surveyed said the huge volumes of data were the leading obstacle to customer centricity.

Another perennial IT problem in banking is the lack of real time capabilities. Many banks are operating on systems built for batch processing. Data is spread throughout silos in most banks, often with different file structures and operating systems. Data warehouses can standardize the information but at the cost of latency which is unacceptable in today’s real-time business world.

The most widely used core banking systems are 30 to 50 years old and were built around products rather than customers. Newer architectures place the customer at the center and can access all the customer’s available information and deliver it across any channel. This enables banks to make personalized offers through tellers, on ATM screens, online and through mobile devices.

Commonwealth Bank of Australia monitors social media 24 hours a day for service issues affecting its own customers. It also watches for complaints about competitors. It is quick to send a message to unhappy customers of its Australian rivals suggesting they move their accounts to CBA.

Achieving this sort of customer centricity requires managing the huge volumes and varying types of data needed to understand customers across their banking, social media, mobile apps and the Web. Yet 40 percent of the bankers surveyed said the huge volumes of data were the leading obstacle to customer centricity.

Another perennial IT problem in banking is the lack of real time capabilities. Many banks are operating on systems built for batch processing. Data is spread throughout silos in most banks, often with different file structures and operating systems. Data warehouses can standardize the information but at the cost of latency which is unacceptable in today’s real-time business world.

The most widely used core banking systems are 30 to 50 years old and were built around products rather than customers. Newer architectures place the customer at the center and can access all the customer’s available information and deliver it across any channel. This enables banks to make personalized offers through tellers, on ATM screens, online and through mobile devices.

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