A few weeks ago, I attended the NIRI National conference in Las Vegas. Q4 was a big sponsor this year and we had an amazing experience, getting the chance to catch up with old friends and launching our new Big Data initiative and Q4 Surveillance & Analytics product.
This year at the conference, I had the opportunity to attend a number of great breakout sessions as well as sit on a panel discussing social media and capital markets. A common theme I noticed amongst the breakout sessions as well as conversations I had with people in general was the topic of investor activism. This was not a huge surprise given the recent accelerated activity of investor activism in the market and the fury of media attention it has attracted.
One panel discussion I attended looked into the inner workings of a major activist investor and a tech company. It was fascinating discussion that really drove home in my eyes the reality that investor activism is going to have a huge impact on how public companies communicate over the web. The whole discussion got me thinking, in terms of social media, it’s all about blogs and Twitter. Below are a few stats shared by Jason Golz from Brunswick Group at the conference that I think really resonate with this discussion and drive the point home:
- Today 60% of Institutional Investors have read a blog and prompted them to research further, 25% invested on the blog post.
- 33% reached further based off Twitter, 12% invested off Twitter. But it’s generally accepted this is under reported, because of Twitter integration into Bloomberg and now TR Eikon.
The key thing to appreciate is that these are 2014 numbers. What is the adoption today? My predication is simply more across the board.
Here’s my view:
News drives the market. This has always been the case, and it’s no different today. What is different is the medium where news breaks.
News breaks on Twitter. If there is something important driving the market, it’s going to spread on Twitter first.
I spoke to someone who’s firm provides media monitoring: broadcast, radio, print, social, etc and provides reports on how it’s impacting the stocks….my thought was “does any of that matter anymore?” If it’s moving markets it’s going to break and spread on Twitter. Full stop. TV, radio, print all follow news that breaks and spreads on Twitter.
To illustrate this point, have a look at this list of the top 25 influencers on Fedex stock $FDX (on a side note, Natalie Heard from FedEx was on the panel with me at NIRI and she was awesome). 80% of the top 25 influencers on FedEx are members of the financial media and Fedex is #2.
Want to know what’s about to be reported on TV before it happens? You can only get that through Twitter. Twitter is the news.
So what does this mean for investor relations?
If you look at companies like FedEx and Home Depot, they are the #1 and #2 influencers on their own stock, which is very powerful. If I told you that you could have as much influence on your stock as anyone in the financial media, what would you say? Maybe; “Sure, but it’ll costs a ton.” But in today’s world, it’s possible and easily achievable goal for a company to be the primary influencer of their stock performance with no cost. Here’s how:
Live tweet your earnings!
The first think I recommend is to talk to your PR or Corp Comm group about live tweeting earnings. They can help and (in my experience) are going to be very keen to help. From this I would also strongly recommend using your primary Twitter account, not a dedicated IR account. (See Home Depot as an example)
Using your primary Twitter account is key in order to take advantage of your company’s full Twitter reach. Let your followers know that you will be live tweeting your earnings ahead of time so they know when to tune in as well as build up anticipation. Earnings announcements are important and you want to communicate their importance and build on that energy.
Using your company’s primary Twitter Account runs counter to previous advice that I have stressed in the past about having a dedicated IR account. I don’t recommend this anymore, as I think it just makes it harder for the company and IR team to generate awareness and value from live tweeting their earnings. Leverage the company channels that have the most reach in order to expand the reach of your earnings.
Stephanie Harig over at Dix and Eaton wrote an excellent post yesterday, sharing a 10 point check list for live tweeting during earnings. It’s an excellent post that I highly recommend checking out in full. Here are Stephanie’s 10 point check list:
- Choose your channel (but also cross-promote)
- Draft tweets ahead of time
- Incorporate a “cashtag” into the tweets – and maybe a hashtag
- Check tweets for tone
- Images, images, images
- Secure necessary approvals – in advance
- Publicize that you are live-tweeting ahead of the event
- Post when you’re starting and stopping the live-tweeting
- Tweet your safe harbor
- Maintain flexibility
From a return on investment perspective, here are the top 5 reason why every single public company should be live tweeting:
- It’s the information that investors and the media is most interested in.
- Your executives and your legal team will easily understand and get their head around it, it’s actually the perfect way to start using Twitter in IR
- Live tweeting creates a live transcript summary of the call. It’s a real-time brief.
- Your investors, employees and other stakeholders will retweet and favourite tweets, establishing your corporate account as a influencer on the stock
- Being the top influencer enables you to drive the news cycle, rather than it driving you.
Circling back to my original comments in this post. By live tweeting your earnings you will establish you primary Twitter account as a influencer on your stock. Achieving this provides a communication channel on par with the financial media and gives you the ability to shape the news that is effecting your company. This is critical in today’s market, where news and it’s impact move faster than ever.
Happy Tweeting!