Mobile Apps and Social Media: The New Paradigm in Investor Communications
By Jeff Corbin
By 2013, more people will use mobile phones than PCs to get online, according to Gartner. That’s not a surprising prediction if you think about it this way: When was the last time you went to a meeting or a dinner and no one took a look at their iPhone? Mobile devices have tethered us to content no matter where we are. The convenience and immediacy of mobile devices, social media, and apps have changed how we do everything. And this applies to public companies who are presently wrestling with social media’s role in Investor Relations. With the sudden appearance of more than 100 IR-specific apps now available across app stores, it is clear that the industry has another communications strategy to tackle. Mobile devices have created a new paradigm in communications, opening the doors for social media engagement anytime and anywhere. Now apps, by extension, are suddenly becoming an important IR strategy for public companies to consider. Investor Relations, at its core, is about valuation—the art of using language and communications to achieve the highest possible valuation for a company. And, it’s not just about what a company has to say to justify its market capitalization, but how it delivers its message to those who will invest and eventually bid up or down the company’s stock price.
For public companies that have not incorporated social media, mobile communications, or app strategies into their investor relations, now is the time to consider doing so. The spread of mobile engagement may seem to present a new set of challenges. At the same time, it brings a wealth of opportunities. According to a 2012 Compuware study, 57 percent of consumers will not
recommend a business with a poorly designed mobile site – the same holds true for anyone investing in a public company. (Source: Compuware, 2012
)Having been in the investor relations industry for more than 15 years, I predict that in the not too distant future, IR apps and social media channels will be carefully watched and regulated by the Securities and Exchange Commission. This is not dissimilar to the SEC’s approach with respect to the IR section of a public company’s corporate website. Nevertheless, until then, social media and IR apps should be welcomed as the way to open up a dialogue with current and prospective investors and help amplify who a company is and what it stands for. The immediate feedback social media provides can help a company anticipate challenges and prepare appropriate responses. It also can allow for the ability to correct information and provide more context and color to the overall corporate story. Therefore, It is up to us to start thinking about what this new industry landscape will look like, help the industry create the best practices for incorporating social media into a public company’s day-to-day communications and start the process of actually using social media in our investor communications.
Any mobile communications strategy should be built around having an IR app that lets companies include alerts, social sharing and investor tracking features. By having an IR app, a public company now owns a very valuable piece of real estate on an investor’s very personal and oftentimes private mobile device. An investor relations app can deploy push notifications alerting investors when new information is available as well as offering investors the ability to sign up for company information, and investor email opt-in. Companies should be prepared to make their IR app function as native on a variety of tablets and devices, not just Apple’s iOS, but also Google’s Android devices.
Forward-looking companies across all industries such as Sysco, Marathon Oil, ITT Corporation, BB&T Corporation and Edwards Lifesciences, have already launched their own investor relations apps, notwithstanding the fact that they also have an IR section on their corporate website. These companies realize that by offering their current and prospective investors a convenient method by which to consume important information via mobile device, not only will they further engage with this audience but will hopefully help to retain them as shareholders.
Incorporating IR apps and social media into an investor relations program may appear onerous, daunting, and/or time consuming. However, from an IR communications perspective, it should be viewed as an opportunity. These new and dynamic tools should be viewed as the means to add more color to a corporate and stock story. They are the new communications paradigm to help public companies achieve the highest and most accurate valuation.
Jeff Corbin is the co-founder of theIRapp™. He has more than 15 years of investor relations consulting experience including development of financial communications programs for the American Stock Exchange and hundreds of companies listed on the NYSE and NASDAQ. Prior to investor relations he was a securities and corporate attorney practicing in New York City. He is the author of Investor Relations: The Art of Communicating Value – Four Basic Steps to a Successful IR Program & Creating the Ultimate Communications Platform. Jeff can be reached at jcorbin@theIRapp.com