Social media has become a vital part of increasing the reach and impact of investor communications. With social media use only growing, and investors finding more company information online than ever before, IROs are continually working towards learning how best to incorporate social networking into daily activities. Unfortunately, it’s not as easy as it may seem, with shareholders, regulators, and business media paying close attention to what public companies post and tweet.
For IR teams, it is an invaluable tool for sharing the company’s achievements, communicating financial information, showcasing management’s vision, and increasing traffic to the investor relations website and earnings calls. In addition, social media provides an additional channel for distributing company content and messages and helps improve the impact of IR efforts and reach more investors.
Social media allows listed companies to get information in front of their audiences rapidly and enables greater, engaged dialogue with the broader Investor Relations community. Therefore, it is highly recommended that companies have a social media strategy fully embedded within the Investor Relations plan.
How to Implement Social Media in IR?
Today, IROs can tailor messaging to target their audiences more effectively by understanding what investors are looking at. Using technology such as data analytics can help determine and measure investor interests from specific regions making investor targeting more effective. Managing media is managing public relations. Just as the IR department should know about capital markets, the PR department should anticipate the media’s interpretation. Once the story leaves the company, the company will no longer have control over the story. Therefore, it is imperative to make sure that the PR department understands the actual story as clearly as possible to communicate it to the media in the right way. To avoid any miscommunication, PR and IR departments must work together to create the perfect story the right way, which primarily stands for the company’s interest.
IR social media marketing can be used for the following purposes:
- Listening to what your target audience has to say about you and your industry so you can embody those opinions and values in the definition of your company’s vision and future development;
- Being informed and engaged on the issues that most investors and potential investors care about will give you the right direction for your communication campaigns and content strategy.
- Encouraging more reactivity and transparency: taking the opportunity to react in real-time to user comments about company key events.
Gathering insights on conversations about your stock: use social media intelligence collected around your published quarterly or annual results, your earning calls, and your financial roadshows
Best Practices for IR Teams to Develop Social Media Efforts
Create a policy. A policy outlines what, how, and when the company will share. It creates a workflow and assigns responsibilities. The company size, sector, key audiences, and expectations will dictate the policy.
Monitor activity. Even if there are no posts, the company must know what people say. Social media listening and sentiment analysis enable gauging public sentiment toward the organization and stock performance. It is not excluded that investors are probably monitoring social media.
Measure engagement. Measuring the effectiveness of the communication and engagement with audiences helps decide where to dedicate resources. Analytics help correlates and better understand data obtained from independent channels and find what works and what doesn’t.
Apply different approaches for different channels. LinkedIn is ideal for sharing most corporate content, from careers to market updates. Regularly uploading corporate results presentations and executive interviews to the company’s YouTube channel helps establish a following of private and professional investors. Twitter is well suited for live earning announcements, management Q&A on Twitter chat, and pointing followers to investor-related corporate announcements.
IR is all about communication. If social media is not yet a part of your communications portfolio, you could be missing out on essential returns. Social media can be used by IR departments in many productive ways, such as increasing visibility, transparency, and awareness of the company, providing more context about a company outside of numbers, and complementing existing forms of established dissemination channels.
Public companies are advised to use social media to complement other IR communication tactics. Beyond having the right objective in mind, when using social media, plan how to measure the effectiveness of your efforts. This will help you learn what social media strategy works with your investors and analysts and adapt it accordingly.
Investor communication is the key to the investor relations department’s functionality. Proactive engagement is an essential part of a great investor relations function. Sager IR creates outreach programs to help and encourage a distribution list that will enhance communication with investors and analysts.