Earlier this week, we highlighted Howard Lindzon’s keynote on Reg-FD and how investor relations is being changed through social media. He had some great insights, and as many great thought leaders, he values input from others in his field. Following his keynote, he led a panel discussion on the issues of access, transparency, and multi-channel deployment with Matt Dickman from Weber Shandwick, Gene Marbach of Makovsky and Co., AECOM’s Paul Dickard, and SAP’s Friederike Edelmann. Watch the discussion in full and catch our highlights and analysis below.
1. Social media usage is all about risk management for investor relations right now.
While there aren’t concrete rules governing social media usage yet, you can help control the conversation. How you respond to conversations online is important- kick them back to environment that you can clearly follow Reg-FD requirements. Be clear how you are using social platforms and lay out rules for engaging on those sites. Companies need to look at engaging in social media with the right controls in place and with governance. While there are complex business issues with social media’s use, it does provide open access to customers. Also, social media data is clean and directional enough that it’s another index overlaying financial performance. Social media has that inherent risk that you can send something that shouldn’t be multiplied with an individual’s twist, but this is no different than other content- the results of it are just more immediate. All in all, the panel strongly felt the benefits warrant a solid look from companies.
2. Know your audience. Different audiences need different media channels.
There are two types of investors: institutional and retail. Your employees typically are retail, and for retail investors, social media is a better tool for engaging. It’s great for marketing to and educating employees about investor relations. The average institutional investor is 85 years old and doesn’t check email on a daily basis. You must use both old and new tools. You can advertise that information is available online, but you still must offer a hotline and accept handwritten letters. Most importantly, you need to communicate in one voice across all these channels and treat all investors in the same way as much as possible. Retail investors should get the same info as institutional investors. People just want the same info in different ways; social can’t be the only channel as much as your website or mailings can’t the sole source of information.
3. Social media offers the benefit of immediate information.
When searching for information on Google, as a vast majority of people do, Google Index’s social content is placed at the top. Any 3rd-party social content can be higher than your meticulously crafted messaging if you’re not participating in social media. So, search has become the great leveler. There’s also the immediacy of the social feedback loop. Brands typically interview participants before and after event to get assessment of what’s on their minds and poll investors for what they want. Now, with social media, this information can be gathered much more cost-effectively and much quicker and immediately. Brands get insights on an on-going, dynamic basis.
Now, what does this all mean? Social is being woven deeper into businesses. It’s no longer just communications to consumers; it has progressed to B2B, HR, and is now touching the deep and intimate level of investor relations. We are experiencing the emergence of fully socialized businesses. The area is ripe for innovation in new tools that bring investor relations to a new level, and we should soon expect to see new regulations that mediate how businesses handle disclosures. Before the government steps up though, we will see more self-governance. Businesses are already looking to each other in this area and learning from one another. I think the financial sector more than most will experience the greatest level of disruption from social and digital trends, and the top brands are ready for this.
Watch all our keynotes from February 2012, and don’t forget to share your thoughts on the discussion below.