No, not that market – I mean the market for our products or services.
Some time back I was writing an annual report for a bank, so I called up a few analysts and institutions who followed the stock. “What would you like to see in this year’s report?” Their answer was succinct: Tell us about the markets where the bank does business. We’re in New York or Boston and don’t spend much time out in flyover country. Are your customers hourly workers or entrepreneurs, farmers or retirees? How fast is the population growing? Does it look like new suburbia or old urban core? What about median income, business formation, competition? Can we see a map?
The market for goods and services is the economic engine that drives future results, so describing and quantifying that dynamo is of great interest to long-term investors in our companies.
Too often, though, investor presentations and earnings announcements ignore the real-world economic interactions and focus only on reporting the latest numbers. Numbers are critical, but this emphasis feeds the short-term interests that CEOs, CFOs and IROs so often decry.
One way to speak to long-term investors is to put the company’s market front and center in the investor presentation, MD&A introductory disclosure urged by the SEC, website, conference call and so on. We can’t do anything about the stock market, anyway, but we can focus on our markets.