Digital Annual Reports for Millennials: An Experimental Investigation of the Effects of User Interactivity and Graphical Vividness

• In Event: The Effects of Formatting

Abstract

As companies increasingly deploy digital annual reports on their websites, interactive data visualizations are frequently used to display both financial and non-financial information for both internal and external users. The designs of these reports often include vivid and interactive displays. We investigate whether and how such displays impact millennial nonprofessional investors’ impressions of a firm’s performance. In a 2 x 2 between-participants experiment with 193 undergraduate accounting students as proxies for millennial nonprofessional investors, we investigate whether varying the user interactivity and graphical vividness of the presentation of non-financial good news counteracts bad news presented in the financial data. We also investigate whether the degree of user engagement positively mediates the effects of display vividness and interactivity. We find that when interactivity is absent but the graphical presentation is vivid, investors indicate higher stock valuation and future earnings growth potential. Finally, we find that user engagement mediates the effects of interactive and vivid presentations on investors’ assessments of the future earnings growth potential of a company and on the decision to recommend that a friend invest in the company’s stock.

Authors

• Yibo Zhang, University of South Florida

• Uday S Murthy, University of South Florida