Social Media and Investor Relations

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Social Media & Investor Relations NIRI: Boston Serena Ehrlich [email protected] @serena

description

A short presentation on how investor relations professionals can start using social media to save time and clarify their company messaging

Transcript of Social Media and Investor Relations

Page 1: Social Media and Investor Relations

Social Media &

Investor Relations

NIRI: Boston

Serena [email protected]

@serena

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Defining RegFD

• Designed to prevent public companies from disclosing material information that may affect the price of one’s stock on a selective basis.

• RegFD can be met by a press release, or more recently via company’s website

• Note: To date, no public company has been investigated by the SEC for their involvement with traditional social media websites although several companies have modified their conduct.

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What Social Media Is

– Analyst interaction on steroids– A natural extension of many of your current in-house depts– 24/7: Social media is continuous– Prevalent

• Lower barriers of entry for companies • Higher consumer expectations

– Successful• Shown to save time• Shown to increase company message clarification• Shown to increase revenues

– Not going away– Encouraged by the SEC– Permenant

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What Social Media Is Not

• Replying to message boards• Sharing information that has not been disclosed• A one-way news broadcast platform• Non-responsive • Text only• Cheap• Easy• Static• Perfect

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Journalist Use of Social Media

5Source: 2nd Annual Middleberg/SNCR Survey of Media in the Wired World

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Analysts Information Sources

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Source: Brunswick Group

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Who is Using Social Media: Twitter

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• 35% use Twitter for investor relations• 68% who use Twitter for IR are in the U.S.• 53% provided a link to their earnings release only• 48% actively engage with their followers

Source: Q4 Web Systems

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Investor Platforms

• Largest financial blog aggregator partnered with Yahoo!Finance. 4M unique users.

• Available on Bloomberg. Trading social network. Based on Twitter. 85K users, growing 500 a day.

• Wiki finance portal. Social interactive data.

* Source: Q4

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Future Usage of SM by Analysts

9Source: Brunswick Group

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Types of Social Media Used in IR

• IR websites• Company blogs• 3rd Party blogs• Multimedia• Investor platforms• Microblogs: Twitter• Company/competitor Intel• Interactive press releases• Virtual shareholder meetings

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Company Blogs: Cisco• Cisco: Uses its consumer-focused blogs to

stave off rumors that could affect stock prices

• Results: – Time saved– Stable stock price– Increased factual information sharing

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Microblogs: ebay• Tweets analyst calls and other key pieces of

information

• Results: – Time saved– Stable stock price– Increased factual information sharing

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Interactive Press Releases

• Make it easy – Include Links– Include video

explanations– Include graphics

• After all…. How do you learn?– Reading– Seeing– Doing 13

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Multimedia: Dell• Dell: Investor

relations vlog

• Results: – Time saved– Stable stock price– Increased factual

information sharing14

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Company/Competitor Intel

• Google News Alerts• Social Mention• Twitter• Seeking Alpha• StockTwits

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Why Use Social Media: Time Saving tips

• Repetitive phone calls– Instead: Flush out the answers to these questions on your

blog. Have legal approve these in advance to save more time

– Time saved: 1 hour a day, 5 hours a week, 260 hrs a year.

• Stock moves due to inaccurate information– 8 hours to resolve the issue, 2 hours to write press release,

etc.– Instead: Write a short, blog post outlining your position in

the industry related to the rumor– Time saved: 10 hours minimum + a more stable stock price

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Starting a Social Media Program• Listen to your analysts – what sites are they using?• Measure your online footprint• Create a companywide social media policy

– Ensures solid company messaging and eliminates potential mistakes

• Write your social media messaging when you are writing your release

• Review your website• Blog! Or at least update your FAQs

– Promote blog in press releases, email signatures, analyst emails so people know to look here for recent news

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Don’t forget RegFD• Company officials are more likely to make a

disclosure error in person or on the phone than via social networks.

• Social media policy is mandatory• Transparency is a requirement• Pre-written comments ensure no disclosure

errors• Include disclosure language/links (cmply.com)• Moderated or no blog comments are ok!

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Making Mistakes

• Everyone makes mistakes• Guess how long it took Dell to perfect its SM program? • What to do if you are attacked online? Don’t react (yet)

– Assess the situation/impact:• Size of site• Audience• Site visibility• Site tone• Tools: Compete.com. Alexa.com

– Determine response• Update your blog with correct, previously disclosed information• Outreach publicly• Outreach privately• Know when to shut up

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SEC Resources*

• /rules/interp/2008/34-58288.pdf Aug. 08 interpretive guidance on websites• /pdf/disclosuredocs.pdf survey of individual investors on use of disclosure• /spotlight/xbrl.shtml XBRL home page (SEC webcast planned for 6/10/09)• /news/press/2009/2009-116.htm proxy access proposal• /rules/final/2007/34-56135.pdf e-proxy rules• Follow @SEC_News on Twitter

*Courtesy of Dick Johnson, IRCafé.com

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Who is Startup Army

• Startup Army is a full-service technology and marketing firm with one main goal, to help our clients build a stronger business.

• Startup Army offers a wide range of consulting and building services including Social Media executive briefings and consulting

• Follow me on Twitter: twitter.com/serena• Email me! [email protected]

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