Investor Relations: Go Social or Not?

Your public company's latest earnings statement, press release, or other positive news story has been composed and is ready to disseminate. You file it with the SEC, email it to the newswire service of your choice, and perhaps post it to your company website. You've met the public disclosure requirements -- now what? If you are not a large, highly visible company who receives ample coverage in the media, how do you attract the attention of the investment community?

In 2008, the Securities and Exchange Commission released a guidance report on the use of company websites for providing information to investors. They recognized that technological advances allow for greater speed and breadth when delivering reports and news to the investor and the markets. The SEC also acknowledged that investors are increasingly turning to electronic media, company and third-party websites to read information about current investments and seek out new opportunities.
This was a huge step in the right direction, and we agree, with this shift in the dissemination and communication process, the information about your public company needs to be present on your website as well as other financial websites and online communities where investors, analysts, and the financial media are active.

So again we ask, how can less visible micro-cap to mid-cap companies overcome this void in media coverage, expand awareness, and become known in the investment community? One way is social media. There are those who continue to shun social networking and deem it as an ineffective tool. However, it's usage for investor relations is being increasingly studied, and progressive companies who are listening, experimenting and adapting to this trend, are leveraging the power of social media quite successfully.
One corporation who has recognized and embraced the benefits of social media on a global scale is Roche, a leading healthcare company headquartered in Switzerland. Roche (@Roche_com) uses their Twitter account to post about their products, research, earnings and corporate news. Their Twitter profile features a link to their corporate website social media section which features links to other social network profiles, tabs for investors and the media, and contact information for the relevant departments.

Granted, this is one of those large corporations we wrote about in our last post who handles IR in-house, but do not discount social media's effectiveness in investor relations for smaller companies. In fact, the social media platforms -- Twitter, Facebook, YouTube, LinkedIn, etc. -- are tailor-made for the small to mid-sized public company, with Twitter proving to be the most widely used dissemination channel for IR by these classifications of companies.

One error we have seen several companies make who do want to use social media to "push" investors and financial media to their news and information is they hire a firm experienced in social networking, but not knowledgeable in current capital markets. A deficient marketing program can result in a lack of volume/liquidity and a lower stock price, which means the company may not receive the influx of capital needed to reach projections. This is detrimental to the company and often depletes their marketing budget.
Building liquidity for a public company's stock requires consistency and time, and should be entrusted to an Investor Relations firm who has thorough knowledge and experience in the securities and multimedia marketing industry. An established IR team who has the expertise to effectively tell your company's story, and professionally act as your communication liaison to existing shareholders and prospective investors will serve you best in the long term.

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Article Source: http://EzineArticles.com/?expert=Lisa_Sawyer

Article Source: http://EzineArticles.com/5653962

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