The nature of technology means that what makes for an award-winning approach to investor relations can vary widely: from chat tools used to keep in touch with retail investors to well-made in-house videos that showcase everything from the latest site visit to key elements of company strategy.
Depending on the region, IR Magazine hands out awards to companies for best use of multimedia for IR, best IR website and/or best use of technology and social media for IR – but all fall under that same tech umbrella, with judges looking for innovation and ideas that stand out from the crowd. What unites the winners is a sense of going beyond best practice and doing more than is expected. But let’s start with the best practice part: what’s the baseline before you even start polishing the trophy cabinet?
IR Magazine has published several research reports on IR teams’ use of technology, with key findings including the fact that audio webcasts are the most widely used – and considered the most useful – multimedia format for investor relations, while corporate video and infographics have seen the greatest growth in use over the past three years. Those statistics come from the IR and multimedia research report, which also suggests that ‘IR practitioners see video as a way of personalizing the company for investors and bringing the company’s operations to life.’
In the IR Websites research report, we reveal that when it comes to what the investment community wants, the three most important types of information are corporate and regulatory press releases, a named investor relations contact and a schedule of upcoming events and reports.
In the Technology & IR report, our research finds that the global average spend on technology is $64,440 – though of course this varies by region, cap size and sector. Overall, however, it is the IR website that accounts for the biggest portion of this spend. And as you look through the list of where else that cash goes, it’s very much about getting the basics of technology right, and spending on areas where you might see the biggest return on investment: from surveillance and targeting tools (second and third place, respectively) to preparing filings or using technology for the AGM (fourth and fifth, respectively).
While our awards recognize best practice uses of technology, the profession hasn’t historically been the biggest early adopter. That’s because budget and team size constraints make IROs less likely to spend time and money on tools or tactics they’re not sure will have the desired impact; and because financial regulation often means IROs will err on the side of caution over risk. But that doesn’t mean you can’t be innovative – and it’s the innovative IR teams that take home awards.
Standing out from the crowd
One such company, which won the award for best use of technology and social media for IR at the IR Magazine Awards – US 2019, is software firm Blackbaud.
The company was recognized for several initiatives, including its development of ‘a portfolio of apps that all members of the team have downloaded onto the phones and tablets that collectively run our IR program,’ says Steve Hufford, director of IR at Blackbaud.
He adds that ‘perhaps the most unique and techsavvy approach to engage the IR community’ is the firm’s approach to social media: namely, its use of LinkedIn. Blackbaud’s posts to the professional social media site now receive thousands of views, with a system to link through to the IR website as well as adding people to the company’s distribution lists ‘based on company profiles to ensure appropriate targeting.’
While Blackbaud’s win came in 2019, the IR team’s digital reinvention began back in 2014 when a new management team came on board and the company decided to in-source its IR function.
‘At that time, company recognition was extremely low on Wall Street, with only two covering sell-side analysts, and there was no formal strategy in place to guide the investor relations function,’ explains Hufford. So the firm’s ‘decade-old’ IR website got a revamp. ‘Essentially, we created a one-stop Blackbaud shop and trained the investment community to leverage the website for documentation, audio and video content.’
Today the company has a ‘carefully curated program to drive traffic to our website and raise Blackbaud awareness,’ Hufford continues. ‘We have campaigns to market, we have CEO and CFO presentations, quarterly results and company initiatives. We also use social media to showcase innovation, announce new products, promote social good and further the IR profession.
‘One particularly fun and informative campaign was providing updates on the construction of our new global headquarters, which was a material investment for Blackbaud – and top of mind for investors. We not only provided updates on earnings calls and investor one-on-ones, but also promoted the development with walk-through updates and even a construction timelapse, so the investment community could see real-time updates on our progress.’
As well as the company’s IR Magazine Award for its multimedia efforts, the response from the investment community has been extremely positive, notes Hufford. He cites Rob Oliver, Baird’s software analyst, who says: ‘The Blackbaud IR team uses LinkedIn innovatively and effectively, both as a corporate communications tool and a way to build closer, more intimate relationships with current and prospective shareholders.
‘A LinkedIn connection enables Blackbaud IR to share its company values in a less formal manner than a standard press release, while allowing it to learn more about the passions of its shareholders and prospects. This likely results in deeper relationships and more fruitful engagements at meetings and conferences.’
So what advice would Hufford offer other IR teams looking to replicate Blackbaud’s multimedia success? ‘Leverage your network and explore the tools that work best for you and your program,’ he says.
IR on film
Moving to Europe and to 2017, it was the Finnish pulp and paper company Valmet that took home the award for best use of multimedia for IR at the London event. As with Blackbaud, the original goal was to widen awareness of the company.
What has grown to a suite of videos for the company started out as an idea to help more analysts and investors ‘attend’ a site visit Valmet was putting on three years ago, explains Calle Loikkanen. Back then he was director of IR at the company but earlier this year he joined food and drinks packaging firm Huhtamaki. ‘We were still a fairly young company, so people didn’t know us that well,’ he says of the original thinking behind that first Valmet site visit video.
Noting that not everyone can physically make it to a site visit – which perhaps becomes even trickier when the site itself is in Jyväskylä, around 170 miles north of the Finnish capital Helsinki – Loikkanen and his team decided to make a highlights video. ‘With that first one, we just wanted to create better investor understanding of what we do as a company and what our products are,’ he says. But having found that video production was reasonably cheap and easy – even when you’re selftaught and doing it all in-house – the team made more.
There’s been some fine-tuning of the way the videos are produced since that first site visit: from around five minutes long then, they’ve now been shortened to about two minutes because, as Loikkanen says, ‘people just don’t watch long videos.’ Valmet has also added more graphics and animation in the form of bullet points and arrows to highlight certain facts or pop-up slides. And all this is done with equipment that cost around €1,500 ($1,600) – the IR team share this cost with the communications department – a €300-a-year subscription to Adobe editing software and a weekend or so spent watching YouTube tutorials.
Clearly a success for the firm, Loikkanen says that while he looks at the analytics provided by YouTube and the like, it isn’t video views that count. ‘I don’t care about the number of viewers because I know that the stuff we do isn’t that exciting,’ he says. ‘But I think it’s enough if one person says, I watched that video and it was good – and it’s really made me understand your company better. If we get that kind of response and that kind of feedback, the video has been a success.’
This is also something he says would be very easy to replicate for other IROs – with minimum investment or risk. ‘You don’t even need to buy the equipment we bought; you could shoot a video on your phone and there’s a lot of free editing software out there,’ he explains. ‘You’ll get faster as you make more videos but if you try it and it doesn’t come out well or you think it hasn’t worked, you don’t have to publish it. You never have to show it to anyone.’
Buzzing the buy side
In Hong Kong, it was Anta Sports that took home the award for best use of multimedia for IR at the IR Magazine Awards – Greater China 2017. And like Blackbaud, the firm won with a multi-pronged approach to multimedia. Something it already stood out for, however, was its use of WeChat, the Tencentowned messaging app and China’s answer to WhatsApp.
WeChat is now an established part of the Asian IR toolkit, just as some brave European companies are starting to make use of WhatsApp for IR. But back when Anta Sports started using the app, it was a novel idea. Now, Suki Wong, IR director at the Xiamenheadquartered company, says it’s a definite go-to when engaging with Chinese investors.
Given the many types of multimedia Anta Sports makes use of, how does the company decide where to allocate resources? It’s all about ‘return on investment,’ says Wong, who notes that while there’s a lot of choice out there, ‘limited time and budget mean we need to identify which group of investors we want to target and then choose the most appropriate method.’
And while compliance remains something IROs have to keep in mind when using chat tools like WeChat, the app has evolved to become even more useful to IR teams. ‘WeChat is about more than just communications now,’ Wong explains. ‘There are lots of little tools within it – such as contact saving, event invitation sharing, surveys – that you can use to promote your IR activities.’
What these three examples alone show is that while there’s a lot to be learned about best practice around IR and technology, when it comes to actually winning awards for your efforts, it’s about standing out from the crowd. And while each of these firms might have a different approach to how it uses tech, what unites them is that it’s not technology for technology’s sake. This isn’t just about posting to social media or putting together a shiny corporate video – it’s about better connecting with the investment community. That’s what marked these firms out as winners in their field, so as Loikkanen advises: ‘Try it – it might turn out great’.
This article was published in the Winter 2019 issue of IR Magazine.