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Is LinkedIn the New Facebook?

LinkedIn these days seems to be less about posting “business” content and more around publishing selfies, memes and math puzzles.

Ironically, these Facebook-like posts generally get more traction. But all engagement is not always good engagement, just like all publicity is not always good publicity.

Interestingly enough, the Pew Research Center found that more workers ages 18-49 have discovered information on social media that lowered their professional opinion of a colleague, compared to those who garnered an improved estimation of a co-worker from online platforms. So, be careful what you post.

LinkedIn prides itself on “connecting the world’s professionals to make them more productive and successful.” What’s happened, however, is the line between “work” and “consumer” content has been blurred, causing LinkedIn professionals to lambast what they see as irrelevant posts, stating: “This is not Facebook!”

A recent post on LinkedIn.

A graphic that accompanied a post on LinkedIn.

The reality is that LinkedIn is competing with Facebook. Late last year, Mark Zuckerberg’s social network announced it was testing a feature that would let page administrators create job postings and receive applications from candidates. This undoubtedly will put pressure on LinkedIn’s Talent Solutions business, which comprised 65 percent of the company’s 3Q 2016 revenues.

With 467 million members in over 200 countries and territories, LinkedIn, now owned by Microsoft, is growing at a rate of more than two new members per second. This quails in comparison to Facebook’s 1.79 billion monthly active users, but the company’s growth shows more professionals see value in the platform.

So what does the future look like for LinkedIn? Consider the following:

  • LinkedIn will become an even more valuable business networking tool among business professionals, surpassing Pew’s estimate of the 14 percent of professionals who use the online platform for work-related purposes.
  • “Irrelevant” posts will continue, at least in the short term, but will have an adverse effect on those who publish non-related content.
  • Thoughtful, engaging and pertinent posts that resonate with key audiences will generate positive engagement.
  • Business organizations and individuals will learn how to leverage this network beyond recruitment and job searches.

Much can be said by the old adage “all work and no play …,” so it’s refreshing to see some brevity in our daily work lives. But these matters may be best suited for Facebook and not LinkedIn.

– George Medici, gmedici@pondel.com

 

And the Award Goes To…

5 seconds of summerAustralian boy band Five Seconds of Summer recently won an award for “Best Fan Army” at the iHeart Music Awards. The award was not associated with any one of their songs, albums, concerts or music videos.  Instead, it was an award based on the group’s online social media engagement.

As I watched the band accept the award and thank their fans (with their Twitter moniker “@5sosFam” flashing across the screen), all I could think of was that somewhere out there was a PR pro doing a happy dance because they just helped the band win a music award.

A recent study conducted by Networked Insights found that a single tweet expressing the desire to see a film translated to the equivalent of $1,100 to $4,420 in additional box office revenue, depending upon how many weeks before the movie’s release the tweet is made.

Strategic PR employs a variety of tools to extend and expand awareness of a brand, product or person – from news releases to social media to media relations, but when was the last time you heard of a Golden Globe being awarded to an actor or director for the best original tweets or a J.D. Power award for best branded Facebook page for a car?

Social media and PR are not mutually exclusive. Engaging social media is a form of PR, and the more effective the social media engagement, the more personal and direct connection between the audience/consumer and the product idea or concept. While most older PR tools are unidirectional in promoting an idea or association with a brand, product or person, social media invites the intended audience to become an active participant in the dialogue, resulting in a multi-directional effort that can be self-perpetuating (for better or for worse). At its core, social media turns each of us into a PR powerhouse – through what we talk and post about on Twitter, Instagram, Facebook, and other social media outlets.

As the Networked Insights study demonstrates, this can translate to real, measurable dollar value, and the possibility that sometime in the future, the Oscars could include an award for “Best Movie Fan Following.”

– E.E. Wang, ewang@pondel.com

Soft Intelligence and Social Media

Cyber security and cyber threats abound, information security policies are now owned at the highest levels of a company from the C-suite to the board, according to EY’s 2013 Global Information Security Survey “Under Cyber Attack.” While companies seek to protect intellectual property and disruption caused by hackers, one area, as it relates to intelligence gathering by investors, deserves further attention: the oversharing of personal information on social networks.Linked-In
 
Today, social media use by institutional investors stands at approximately 52%, according to a NIRI survey earlier this summer. What I am noticing more and more in my daily conversations with investors is that social media seems to be emerging as a tool to get an edge on impending news, particularly as it relates to the broadcasting of new LinkedIn connections.
 
While tracking Facebook “likes” on emerging brands as a proxy for potential revenue growth or monitoring hiring trends or personnel departures from company LinkedIn pages to gauge near term expenses might seem an obvious use of social media to impact investment decisions, what might not seem so important is the innocuous LinkedIn request.
 
Following a roadshow or investor conference, management might receive a request to “connect” from an institutional investor. If the request is accepted, consider what that might mean going forward if new connections are then broadcast to that investor; it may very well tip your hand on impending news.
 
A quick fix would be to turn off LinkedIn activity broadcasts by visiting the privacy settings of your account. Longer term, it’s wise to consider a companywide policy.
 
Matt Sheldon, msheldon@pondel.com

Lights, Camera, Earnings!

Traditionally, earnings calls have been a cut and (very) dry quarterly procedure. But with the emergence of social media and the SEC’s move to embrace them, following is a summer round up of how companies are finding new and creative ways to put a little pizazz into their calls.Yahoo Earnings Call
 
During Yahoo!’s most recent call, CEO Marissa Mayer and CFO Ken Goldman appeared on a high-quality streaming video webcast, answering questions from analysts who called in. The company also live-tweeted key messages from their corporate Twitter account.
 
Zillow made a splash with their call in early August as the first company to answer questions submitted live through Twitter and Facebook. Spencer Rascoff, Zillow’s CEO, answered questions from individual investors, as well as sell-side analysts.  Zillow also leveraged both Twitter and Facebook to tell their story visually, posting infographics with metrics that illustrated recent growth.
 
Like Yahoo!, Netflix participated in live streaming video, but they tweaked their approach to the Q&A session by moderating a panel discussion that included a member of the financial press and a covering sell-side analyst.   Questions were screened in advance for CEO Reed Hastings and CFO David Wells.  The questions were also unattributed.
 
The jury is still out whether more companies will embrace video earnings calls in the near future.  But shareholders seem to like it. Approximately 70% said that compared with audio-only earnings webcasts, video webcasts of a company’s CEO inspire more trust, according to a Shareholder Confidence 365 Study that received responses from nearly 11,000 professional and individual investors.
 
The challenge is training management to feel comfortable in front of a camera.  After all, answering questions with a furrowed brow could have unintended consequences when it comes to instilling confidence in your shareholder base.  Same goes for too much powder!
 
Joanne Sibug, jsibug@pondel.com

Cashtag Blues

Last summer, with relatively little fanfare, Twitter added clickable stock symbols to its tweets.
This is how it works: Add a “$” in front of a ticker symbol in Twitter’s search box and you’ll be able to engage in conversations about a particular company, similar to what would happen with a hashtag “#” followed by the name of your favorite pop star.

twitter
In social media circles, introducing the “cashtag” is yet another way to stimulate chatter among people
who are interested in a particular topic, such as public companies. But like all seemingly helpful social media tools, the cashtag may, in fact, send your stock tumbling down in 140 characters or less.  We recently observed such a scenario.

Shortly after market open on an otherwise average trading day, an anonymous tweet began surfacing about an FBI raid on a certain public company.  Soon the company’s trading volume began rising and its shares began
dropping, so much so that, as IR representatives for the company, Bloomberg called us to find out if the rumors on Twitter were true.  We confirmed that the rumors were false, and soon the stock corrected itself.

We later learned that the SEC opened an investigation on the tweeter for a possible “10b-5” infraction, which is when someone makes fraudulent claims in connection with the purchase or the
sale of a security.

Rumors surrounding public companies have been swirling about the Internet long before the cashtag, but this example serves as an important reminder that new information channels, carrying potentially market moving information, are reaching influential audiences at light speed.  And that means the onus will increasingly fall on investor relations professionals to ensure chirping birds are not making fraudulent claims.

 

Evan Pondel, epondel@pondel.com

Social Media’s Global Growth

The stats on social media’s global growth are staggering.  A graphic recently posted in Mashable.com illustrates how the world consumes social media.  And boy does it!

Facebook Logo

 
We all know that Facebook now has one billion users in 127 countries and is the top social media destination.  It’s also interesting to learn how countries and regions outside the U.S. are adopting social media like Asia, which has grown to more than one billion Internet users in a little more than ten years.
 
Or that 800 million users visit YouTube each month with more than 70 percent of the site’s traffic coming from outside the U.S.  In fact, 700 of these videos are shared via Twitter every minute.  Moreover, LinkedIn increased its membership nearly by half in the last two years with Turkey, Brazil and Indonesia seeing the largest user growth.
 
All this data can seem very overwhelming.  Even though the growth of social media seems to be a no brainer when it comes to global marketing, many executives still fail to grasp the opportunity.  Let’s be clear: social media is not slowing down anytime soon.
 
Not all social media platforms may be relevant for every business organization.  There is no one size fits all solution for tackling this new media landscape.  However, given the global economy and the opportunities social media presents, these new platforms can help organizations engage with consumers, customers, and even investors, all over the world.  It’s like six degrees of separation on steroids. The proof is in the data.
 
So, the world is consuming social media.  Are you?

 

George Medici, gmedici@pondel.com
 
 

Video: The Next New Thing in Earnings

 
We can’t stress enough the importance of video and its pervasive use in today’s media landscape.
 
Aside from the sharing benefits and vast potential online media pickup, video creates stronger bonds with key audiences.  It’s why we love movies so much.  There’s no other medium that produces the same visceral effect.
 
Publicly traded companies are starting to realize this trend.  Early adopters are using this medium to complement quarterly earnings, embedding video links in press releases as we did for our client (see above), Kirkland-based Market Leader, Inc. (Nasdaq: LEDR).  Done right, videos that accompany press releases of all kinds should be news driven versus corporate slick, delivering more authenticity that is designed for viral uptick.  Other companies that have used video for earnings include DellCitiBASF, and InterContinental Hotels.
 
Leveraging video to communicate financial results can be quite daunting however, especially since these platforms are relatively new to investor audiences.   While the SEC’s Office of Compliance Inspections and Examinations offers guidance on the use of social media for investment advisers, the bottom line boils down to best company judgment, and of course, input from counsel.
 
Professional investors are watching too.  According to a study, 58 percent of institutional investors and sell-side analysts in the U.S. and Europe believe new media will become more important in helping them make investment decisions.
 
There’s no doubt that using social media to communicate to investors remains a fairly prickly topic among CEOs and the investment community.  The reality is that more Fortune 500 companies are blogging, tweeting and utilizing new media platforms to communicate to key audiences in ways never before.  Moreover, engaging in video builds social capital, a valuable network that ultimately enhances reputation, and we believe shareholder value, too.

 

George Medici, gmedici@pondel.com
 
 

It’s 10 p.m. Do you know where your IR program is?

Investor Relations

Investor Relations (source)

I’m not really asking where your IR program is in the geographic sense of the word.  I’m asking where your IR program is in terms of effectiveness.  Every once in a while, it’s good to take a step back and evaluate whether your strategies and tactics are still productive.
 
A recent webcast, based on a survey conducted by Thomson Reuters, demonstrated that in today’s world of “risk aversion, macro dominance, reduced focus on active equity and equity fund outflows,” getting your story heard can be very challenging.  An article in CFO Magazine echoed the sentiment that “the rockiness of the equity markets and the prevalence of high-frequency trading and exchange-traded funds make cultivating the investor base tougher than ever.”
 
Are you doing the right things to be appropriately noticed by the investment community?  Respondents from the Thomson Reuters survey noted that knowledge of the business and ability to answer questions, responsiveness and timelines, and financial guidance are among the most important facets of a good investor relations program.  Interestingly, however, a separate survey conducted by the National Investor Relations Institute showed that the number of companies providing financial guidance has steadily declined over the last several years, with 76 percent of companies providing financial guidance in 2012, compared with 81 percent in 2010 and 85 percent in 2009.
 
While there will never be full agreement between the investment community and listed companies on providing guidance, and while every investor relations program is unique, there are a few things that all IROs should consider:
 

  • Build trust with the investment community through consistency, transparency and willingness to engage.
  • Take an individualized, targeted and precise approach to identifying appropriate investors.  Spend time with these prospective investors through one-on-one meetings, at conferences or by hosting site visits and investor days.  Stress quality over quantity.
  • Ensure your messages help the investment community understand your growth path and its trajectory.
  • Use business and financial press as an additional communications vehicle.  Include video in press releases and on your IR website to generate better engagement by making your story come to life.
  • Be aware of what’s being said about your company via social media, and strategically use social media to deliver your messages.
  • While any worthwhile activity generally requires time and patience, the long-term result should be enhanced shareholder value.

 

Laurie Berman, lberman@pondel.com
 
 

Dear Abby: Why do IROs shun social media?

Dear Abby star on the Hollywood Walk of Fame

‘Dear Abby’ Star on the Hollywood Walk of Fame (Photo Credit: wikipedia.com)

Social media have been a part of our lives long before the advent of the Internet.  When our ancestors used ochre, hematite, charcoal and other materials to paint their triumphs and tragedies on cave walls and ceilings, they were engaging in social media.
 
When ancient Egyptians carved elaborate scenes on vases, amulets and pots, they were engaging in social media.
 
And when Pauline Phillips established her “Dear Abby” advice column in 1956, she was engaging in social media.
 
Media have always been social.  The difference today is that the Internet speeds up the dissemination of information, which is often repurposed and then dubbed “social” when it’s tweeted or published on a blog, YouTube or Facebook.   The challenge for professional communicators is harnessing the speed and power of the Internet to communicate effectively.
 
In the investor relations world, many professionals do not believe that today’s social media outlets establish effective lines of communication.  The proof:  84 percent of IROs do not use social media to communicate with their constituents, according to a Thomson Reuters survey due out this week.
 
I understand that IR folks, including myself, are more cautious about embracing social media because so many of the facts and figures we work with require adherence to strict disclosure procedures.   But that shouldn’t stop us from tapping into social media for other purposes, including the reinforcement of messaging and establishing dialogue with customers, shareholders and even employees.
 
As communications professionals, it serves in our best interest to understand how social media can be utilized to communicate more effectively with different audiences.  For example, London-based Derwent Capital runs a hedge fund that relies on Twitter for investment direction. StockTwits, which my colleague, Matt Sheldon, wrote about nearly six months ago, continues to garner more credibility in investor circles.
 
The bottom line is that human civilization has come a long way since relying on granite, clay and, yes, newsprint, to facilitate the flow of information.  Don’t you think it’s about time that IROs do the same?

 

Evan Pondel, epondel@pondel.com
 
 

Twits and Stones May Break Your Bones

Photo Credit: crunchbase.com

As the year begins to wrap up and office parties kick into high gear, I wonder what next year holds for the world of investor relations.  Proxy access, say-on-pay and XBRL were widely discussed topics throughout the year, but none may have reached the feverous pitch more than the use of social media in investor relations; and that trend will likely continue in the New Year thanks to a recent development.
 
Last week, Yahoo! Finance launched a feature called “Market Pulse,” an area of the site that aggregates feeds or discussions of a particular stock in real-time from StockTwits and Covestor. If you have never heard of StockTwits, just think of it as Twitter for the world of investing. Maybe a little less known is Covestor, a social network for investors that allows them to mirror transactions of other investors.
 
At first glance, I admit that I dismissed StockTwits as nonsensical ramblings by a bunch of “Twits” and Covestor as speculative herd mentality – but I decided to take a closer look.
 
Within a few seconds, I noticed that Dell recently created an official StockTwits page, for which they most likely paid the going rate of $250 dollars a month. Their page had around 45 posts and five followers through last month, and I began to wonder why Dell might have established the account in the first place.  My thoughts:
 

  1. Monitoring online conversations is an important component of reputation management. If you are not engaging with your investor constituencies online, you should at least be listening and ready to respond.
     

  2. As investor audiences increasingly move online, content should be distributed across multiple platforms simultaneously.
     

  3. Companies do not always need a press release or Web cast to communicate with shareholders.  Sometimes it is more efficient and cost effective to express yourself in 140 characters or less.

 
As social media platforms debut and real-time applications evolve, I suspect that in the New Year the investor relations community will have plenty of new services to consider.  While it is important to keep an open mind, one should understand their value and whether they are worth the time and money in the first place.

 

Matt Sheldon, msheldon@pondel.com