5 Ways companies can better engage their investors on social media
Rob Swystun, Pristine Advisers
While social media sites like Twitter and Facebook have been influencing consumers and even voters for years, investors have proven to be slow adopters of these platforms.
But that is changing.
According to the Brunswick Group’s recently published survey: Trends in the use of Digital & Social Media by the Investment Community, where the company queried 500 investment professionals from Europe, Asia and North America in a wide variety of sectors, the use of social media platforms to investigate companies and make investment decisions is way up.
Some of the high level findings from the survey are:
- 30% of investors use Twitter to help investigate companies.
- Investor reliance on digital media to gather information has doubled since 2010.
- 86% of investors say online sources like blogs and social media have become more important this year with investors.
- 56% of investors report that the influence of digital and social media is increasing in their investment decision process.
- Investors aren’t just consuming information from social and digital media, but are also actively contributing investment information via these platforms.
- 24% of investors report making an investment decision after sourcing information from blogs.
- 61% of US investors have been prompted to investigate an issue further after reading about it in a blog post.
Jason Golz, Director of Brunswick Group’s San Francisco office, said that even though investors aren’t making actual stock buying decisions from places like Twitter, they are taking information from there and using it as the cornerstone of what he refers to as the investor mosaic, which is the portrait of a company that investment professionals piece together from various information sources to decide if it is worth investing in.
And what is driving investors to platforms like Twitter and LinkedIn (which has a growing relevancy compared to Facebook’s slowly shrinking relevancy for investors) is the fact that they are not only good sources of information (especially tidbits that might not be splashed around more mainstream media sites) but they are interactive. So if investors have a question or want clarification on a piece of news they’ve read on Twitter or in a blog, they don’t have to take the time to find a contact, write an email and include a link to the information or make a reference to it that may be misconstrued, they can simply ask their question right then and there on Twitter or in the blog’s comments section.
So we know that these platforms are important and that’s great and all, but how do you leverage these to your advantage?
1. Start with the basics.
Before you start madly creating content for social media and start spewing it all over the web, remember that it is quality and not quantity that you are after.
This goes back to the very basics of creating good corporate culture, brand awareness and brand identity and that is to tighten up your company’s value proposition, its core competencies and its competitive advantage. Your company should have the best possible corporate narrative and product narratives in place and be able to definitively answer the question; How do we do what we do better than anyone else in the world?
All the new communication channel represent are a new way for a company to get its message out. But those traditional messages have to be the best that they possibly can be first. If a company’s traditional messages are not well prepared, shooting that info out onto the web is just going to amplify how poor they are.
2. Have a digital and social media policy and strategy in place.
If your company doesn’t have a social media policy and strategy in place, you’re at the very least five years behind the times (and how much does a mortgage for the underside of a rock go for these days, anyway?).
This policy should address what platforms you choose to use, what message you want to send, who is authorized to use these platforms on behalf of the company, how should you engage people on platforms like Twitter or on their own personal blogs (i.e. should you send a tweet back or write something in their comments section or just ignore it), whether you should be proactive or reactive in engaging people, etc.
The strategy should address how you will engage your stakeholders (customers, investors, partners etc.) on social media platforms. There is really no template to follow and every company is different so every strategy will obviously be different.
And don’t think that you have to jump into the deep end to play catch up, either. Investors will be happy just to see that you are trying to engage them so start small, maybe a few tweets here and there, try starting a blog on your website and grow it slowly and naturally. You’ll be a social media star in no time.
3. Invest in your own website.
While third party platforms like Twitter, AlphaSeeking, StockTwits, LinkedIn and the myriad blogs out there are places where investors go for information on a company, the number one place they go is still the company’s own website.
So it obviously pays to invest in your company’s online home. That dusty old FAQ section that nobody has looked at in years can easily be replaced by a Hot Topics section where people go to see what is really shaking with the company. And the hot topics within your company will be easy to identify (hint; they’re the things everybody is talking about). So if your CEO or CFO does a conference call and a key phrase keeps popping up over and over, that right there is a hot topic.
And since everybody and their dog has a blog these days, so should your company. Subjects need not be hard to come by or write about, either. That conference call mentioned just up there? Record it, whittle it down into something legible — boom, done. You’ve got yourself a relevant blog post.
Even better, get your CEO in front of a webcam, slap some makeup on the old guy and have him do a video update maybe once a month or so. Face time with a company CEO is the No. 1 way investors like to get information from a company, according to the Brunswick Group’s survey. This is the next best thing.
4. Make sure your messages have actual substance.
The problem with a lot of press releases and other messages nowadays is that they are pretty frivolous. Don’t send out a press release just saying you’re pleased that your company saw record revenue for a given quarter, send out one outlining the reasons your company saw record profit and how you aim to keep that momentum going into the future.
If you don’t give your investors and potential investors some meat in your messages, they’ll go find it elsewhere from places that you have little or no control over (other people’s blogs, etc). So give them what they want.
5. Monitor what is being said about your company and know how to react to it (but only when necessary).
Set up alerts, whether through SeekingAlpha, Google or business news sites, for your company so you can monitor what is being said about it. And be prepared to react to it in a way that is consistent with your social media policy (that’s why you have the thing).
How you react to what is being said (and this pertains more to negative things than positive things) will depend on whether or not it is being said by a key influencer in your sector. Key influencers in a given sector will be easy to spot because they tend to be the ones who engage people the most, who have the most followers on Twitter and whose blogs generate pages and pages of comments.
Back in the print days, if you saw a story in the newspaper, you could easily call up the journalist who wrote it and have a pleasant conversation with that person about what they didn’t quite get right. But times are less civil now and the internet is about as uncivil a place as you can get so you will have to tread carefully here if you want to interact with the author.
Of course, you might not want to react at all. If you spot something negative being said about your company in a blog where the comments section is barren and the blogger has fewer Twitter followers than your grandmother, you might just want to ignore it, lest you actually end up bringing attention to it and creating controversy where there is none (also known as journalism).
So, remember that if you had any doubts about getting on the social media bandwagon, those should be put to rest. Investors have now joined consumers and voters in finding influence on these platforms and even basing major decisions on them. The time for testing the water is over. Jump in.