Virtual reality: Is virtual the key to remaining agile, or a temporary stopgap?
There’s no doubt that the past 18 months have significantly changed the IR landscape. Thanks to lockdowns, travel restrictions and remote working, virtual-only events – if any events at all – have fast become the new norm.
At IR Magazine’s recent North America Forum, Debbie Hancock, senior vice president of investor relations at Hasbro, highlighted the realization that simply doing the same events but making them virtual isn’t an option, and that a change of format and strategy is needed.
‘There are events you do that you make available virtually, and there are events that are created for the virtual world,’ she said. ‘You could easily fill up a lot of time doing the same thing over and over again. Instead, we’ve done things like focus on smaller groups [and] we’re doing half a day, two thirds of the day or a couple of hours because that works best from our standpoint. We’re not focusing on geographies – we’re focusing on what’s the best use of time.’
New communications tools
The virtual landscape has also offered IR teams the perfect opportunity to try something new. Hancock explained how Hasbro replaced its traditional investor day with a pre-recorded, highly-produced event.
‘We filmed executives all around the world where they were situated,’ she said. ‘We did a lot of editing, post-production, graphics, video and music, and made it a curated, bespoke event that was very engaging.’
The move was welcomed not only externally, but alsointernally. ‘We got a lot of very good feedback from investors about it,’ said Hancock. ‘We also got really good feedback from our employees. People don’t usually call up and say, Wow, that was a great IR event, but this event was really well received.’
Panelist Rob Garrigan, head of corporate services at OpenExchange, has experienced the same shift in attitudes toward creating virtual events that have longevity and add value. ‘Many of the companies we’re working with realize and recognize that you’re creating an asset,’ he explained. ‘This is not a one-day event, this is not your typical earnings call.
‘This is the opportunity for the company to tell its stories, to share its strategy, keep the mindset around the longer term, rather than just being about what’s happening next month or next quarter. It’s creating an asset that will have some shelf life.’
The pandemic has also opened up new opportunities for engaging with different audiences, as Mark Chyc-Cies, vice president of strategy, planning & investor relations at Gibson Energy, observed: ‘We’re finding we’re getting more contact with investors in secondary markets where we previously wouldn’t go very often, which is a benefit.’
Chyc-Cies has also found that the greater flexibility of virtual events has benefited companies and investors alike. ‘I think the other thing we’ve noticed is that it’s easier to meet outside of the conference,’ he said. ‘You’re seeing a lot more investors reaching out for check-in meetings outside of brokered events so it’s actually been very beneficial that we don’t have to wait for a conference or get to a city.’
Despite all of the positives discussed at the forum, however, it’s clear that those on the panel have experienced some drawbacks. ‘It does seem to us that, pre-Covid, it was a little bit easier to get that intro meeting,’ Chyc-Cies explained. ‘When you were traveling through town, it was more of a rationale to stop by and meet the management team and make introductions. Virtually, I think that’s a little bit more of a forced introduction virtualy, especially if it ends up being a one on one.’
Hancock also felt virtual events impeded some opportunities for relationship-building, especially given their public nature. ‘You miss building those relationships,’ she said. ‘If I want to have a conversation with somebody before a group meeting and there are 10 other people on it, everybody’s listening to that conversation. You can’t have that private chat anymore – not that it’s about anything important, exactly: it’s just about building that relationship.’
Looking to the future
With virtual events likely here to stay for the foreseeable future, what corporate access opportunities will exist, and how are they expected to evolve? For Hancock, it’s about the value they can add.
‘I still think there’s a role, particularly if they’re able to bring in some of those new investors that are a little more challenging to get in front of,’ she said. ‘It’s going a level deeper, maybe with those secondary and tertiary cities you’re not as familiar with.’
For Chyc-Cies, it’s a timely reminder of the value of the function, and what IR teams can learn from it. ‘The way we do our job is to evolve, and I think the sell side will need to evolve, too,’ he said. ‘I personally like giving the sell side the opportunity to plan the day and plan the logistics. It is better at it, and it’s a good opportunity to recognize a ton of great work that’s being done by corporate access and events people in terms of putting these events on.
‘I would always say that as IR professionals we should make a point to be extra kind to corporate access folks. There’s an opportunity where we can really learn from them.’
Whatever the future may hold, the level of optimism at the forum was high. Commenting on his positive experiences of IR teams handling whatever is thrown at them, Garrigan concluded: ‘As we look forward, the way we’re going to engage with people is going to have some aspect of virtual tied to it. It’s in the DNA of every IR professional I’ve ever had the pleasure of working with: they are nimble, they are able to adapt.’