March 5, 2014
Here’s a surprising truth: investors and analysts are starting to pay greater attention to websites and social media for information. In fact, the recently released study from The Brunswick Group on the use of digital and social media by the investment community reinforces what we’ve been hearing anecdotally. Although, as the study confirms, the investment community still prefers to go directly to the company for information, digital and social media are growing in importance.
Consider these data points from The Brunswick Group’s 2014 study:
- 59 percent of investors read blogs for work, 26 percent use social networks for work and 30 percent use micro-blogging services for work
- 1 in 7 investors made an investment decision based on a mosaic constructed around a tweet – but “Twitter’s influence may be underreported due to its recent inclusion on platforms such as Bloomberg, which also grew in importance”
- 21 percent of investors believe the role of digital media will “definitely” play an increasing role in future investment decisions; 47 percent think it “probably” will
The bottom line is: investors are broadening their sights to include new sources of information. But it’s not too late to develop a proactive IR strategy around digital and social media for your company – and you don’t have to reinvent the wheel to do it. Here are some key initial questions to ask yourself as you develop that strategy:
Is my IR website working?
A company’s website is typically the first place investors go for information, but many companies don’t take full advantage of this opportunity. Use your website to reinforce messaging and make information easy for investors to find. And make sure you understand how the buy side is using your website.
What are other companies doing on social media?
Many companies are active on social media for IR purposes, so you should have no problem finding a model that will help you get started. Twitter is the easiest and most commonly used site when it comes to IR because it functions like a news clipping service. Check out the Twitter activity of Twitter, Zillow and Cliffs Natural Resources.
What are users already saying about my company, particularly on Twitter?
There is a good chance that conversations about your company are occurring on Twitter whether you are active on the site or not. Checking in on your company’s cash tag (dollar sign plus your stock symbol – e.g., Twitter’s cash tag is $TWTR) is a good place to start.
What should I be sharing via social media?
The short answer: anything you are already making public via news releases, SEC filings, etc. It’s all fair game for social media from a Reg FD standpoint, which – thankfully – makes creating initial content relatively easy. Then, consider supplementing this content with additional activity such as tweeting during earnings calls and analyst days.
Do you know of other companies that are doing a good job of using Twitter or another social media site for IR? What additional key questions would you ask when developing an IR digital and social media strategy? Leave ‘em in the comments!