Building strong stakeholder relations with social media
Published on April 5th, 2010 by Lisa Davis
It didn’t happen. Social media didn’t go away. In fact, quite the opposite has occurred: Social media has exploded in its usage and ubiquity, and now significantly influences many communications around the world. The challenges of strengthening corporate reputation and building trust among stakeholders can prove difficult for any professional communicator. Across investor relations circles, the practice of supplementing more traditional IR strategies with social media is not widespread. Certain functions specific to IROs, namely the disclosure of material news, make adopting social media and using its channels as primary communication tools something to be thoughtfully considered. So, for the sake of this brief discussion, let’s sidestep the legal department and address the “relations” function of the IRO so that we can better understand how channels like Twitter, Facebook, YouTube and corporate blogs can work to enhance shareholder relations and improve the corporate bottom line.
Some “untruths” about social media for IR
Common fallacies among IROs considering social media include:
- It’s only for the public relations and marketing departments.
- My target audience and stakeholder groups are not active in social media.
- There is no connection between social media and my company’s financial results.
As more IROs begin to implement social media as part of their overall communications strategy and use the channels to enhance — not necessarily replace — traditional IR practices, they are connecting with media, analysts, investors and consumers in new and profitable ways.
How social media can strengthen the IR function
Social media connects you to audiences that matter. For those who think Twitter and Facebook users aren’t relevant to IR, think again:
- 85 percent of financial services professionals under 50 are utilizing social media (LederMark Communications)
- 58 percent of institutional investors and sell-side analysts in the US and Europe believe new media will become more important in helping them make investment decisions (Brunswick Group)
- 35 percent of Fortune 500 companies have a Twitter account (The Center for Marketing Research at the University of Massachusetts Dartmouth)
- 79 percent of the top 100 companies in the Fortune Global 500 index are using at least one of the most popular social media platforms: Twitter, Facebook, YouTube or their own corporate blogs (Burson-Marsteller Fortune Global 100 Social Media Study)
For IROs, social media presents opportunities to directly access the stakeholders and influencers who are active within networks and groups, and lets you connect to customers, analysts, investors and the media.
Social media can start conversations and strengthen existing relationships. Every day, millions of people are sharing ideas and opinions on companies, products and brands. Search Twitter, YouTube or Google Blogs for your company, your CEO, your products and services or your competition. Chances are, you can’t afford to stay out of those discussions. By tapping into and monitoring conversations, you’ll soon identify the key influencers and opinion-shapers you need to talk to and incorporate into your IR outreach. The opportunities to promote your company and make it attractive to potential investors abound in social media. You can go beyond telling the story through financials and build strong relationships with key and new stakeholders. Remember, people are already talking about your company — it’s your choice to ignore or engage.
Social media participation can directly affect your bottom line. Attributing ROI to social media participation can prove difficult, but directly correlating a company’s financial performance to its social media activities is impossible, right? Not necessarily. The Wetpaint/Altimeter Group’s ENGAGEMENTdb Report found that the most valuable brands in the world are “experiencing a direct correlation between top financial performance and deep social media engagement (interacting with others, instigating discussions and responding during conversations.) The relationship is apparent and significant: Socially engaged companies are in fact more financially successful.”
Where to begin with social media
The tips, rules and strategies for establishing a presence in social media are seemingly as infinite as the channels themselves. Let’s keep things simple and outline some straightforward activities and no-cost ideas you can put to work right away:
- Listening: The old adage holds true: “Think before you speak.” Perhaps the most common mistake people make in social media is jumping into the conversation too soon. Take the time to search the most popular sites – Twitter, Facebook, LinkedIn, YouTube – for mentions of your company. Who’s talking about you, and what are they saying? Technorati can help you identify key industry bloggers, and searching for keywords at BlogPulse can show you how many bloggers are talking about your company and industry. Listening is the best first step because it is risk-averse and you can remain anonymous.
- Monitoring: One of the easiest and most effective free monitoring tools is Google Alerts. Many IROs spend at least part of their day monitoring the discussions and analyses on Seeking Alpha or following real-time conversations and investor sentiment on StockTwits. Ongoing monitoring will not only help you identify key influencers, it will keep you abreast of important conversations should you, or someone in your company, need to respond.
- Sharing: According to the Pew Research Center, 75 percent of online news consumers get news forwarded to them through email or posts on social networking sites, and half of those people pass along email links to news stories or videos to others. Powerful statistics indeed and a testament to the importance of incorporating social components into your news to facilitate it being shared. This is not a difficult or costly process, and many digital assets that already exist (perhaps in the public relations and marketing departments) can be re-purposed and used with great efficacy across social media and on corporate websites. Making audio, video, photos, presentations and other collateral available to a wider audience can greatly increase corporate awareness and transparency, and provide a more robust overall picture. It can also personalize a corporation and engage investors and other valued stakeholders. And because social networking sites encourage feedback and comment-sharing, you are able to stay on top of conversations and respond accordingly. Easy first steps for content sharing can include:
- Being proactive with your investor communications and republishing news release titles and earnings alerts via Twitter after they cross the wire. Be sure to include social media sharing functionality in all of your releases.
- Socializing digital content by posting corporate and executive photos to Flickr or Photobucket, and presentations to SlideShare and docstocs. Corporate channels on YouTube appeal to a wide range of audiences – remember, the site is second only to Google in search-engine use.
- Promoting your company to a broader online audience of shareholders and prospective investors by creating a corporate Facebook page and posting news, video and photo content.
- Maximizing interest and “stickiness” on your corporate website by including icons, links to corporate social network channels, multimedia elements and a company RSS feed.
- Increasing “findability” of your news and corporate website by ensuring that all of your content is optimized for search. Good search engine optimization (SEO) strategies are essential to successful online communications.
“This is no longer a shareholder but a stakeholder world. Companies need to be everywhere, engaging everyone…communicating through a variety of channels,” reports The 2010 Edelman Trust Barometer. For IROs, social media presents an incredible opportunity to meet the challenges of reaching the people who matter to their companies, and to use channels and resources like Twitter and YouTube to engage stakeholders.