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Investor
Relations
IR is the strategic corporate
management activity that integrates finance, communication,
marketing and securities lawompliance to enable the most effective
two-way communication between a company, the financial community,
and other constituencies, which ultimately contributes to a
company's securities achieving fair valuation.
IR is an
interactive discipline: on one hand, it communicates the company’s
story to the investment community to demonstrate the company’s
investment merits. On the other hand, IR received and analyses
feedback from the targeted investment community.
The focus is
the bridge the expectation gap between the company and the
investment community to optimize the company’s validation.
The target
audience for IR activities consists mainly of (industrial) investors,
equity analyst firms and other financial institutions that make
“buy, hold, sell” recommendations.
Needless to say, IR is
critical for the profitability and survival of a company. The best
option for a company is to hire a well-established IR company with a
proven track record in the company’s industry and an in-depth
knowledge of the rules and regulations.
Analyst Relations
Industry Analyst Relations focus on
third-party validation and its target audience consists of industry
analysts and experts such as Forrester, Gartner, Yankee and IDC.
These analysts –seen as independent and impartial,
cover a wide range of industries, studying major players, markets,
products, facts and trends.
They influence equity analysts,
although they themselves don’t own shares in the companies they
cover and also don’t make any trade recommendations (buy, sell,
hold).
Analyst Relations are
important for communicating with the financial community, potential
investors, customers, suppliers and the
public.
When covering the
company in the media, journalists often contact analysts to get or
verify information concerning the company’s products, applications,
customers, markets as well as the company itself.
Positive
coverage by analysts is also positive PR for the company and cements
the corporate brand.
As a marketing tool,
analyst relations is a cost-effective and strategic approach to:
1)
facilitate
capital-raising efforts;
2)
increase
sales;
3)
generate
partnerships.
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Public
Relations
PR is the planned and
sustained effort to establish and maintain goodwill and mutual
understanding between an organization and its
publics.
It is therefore a lot more than
"talking to the press" and hammering out press releases.
The PR
professional can be external (a PR agency) or internal (corporate
communications).
PR is part of marketing and consists of
several intertwining subsegments relating to a specific
public:
- Investor
Relations addresses (potential) investors
- Corporate
Communications addresses subsidiaries, agents,
distributors, (potential) customers, communities (external
communications) as well as employees (internal
relations)
- Marketing Communications
(marcom) addresses specific and potential markets of the
company.
A seasoned corporate communications
professional combines his or her PR expertise with knowlegde
of business development, customer relations (CR)
and legal knowlegde.
No matter which
media outlet is chosen, the PR professional must keep the
following in mind to get the message across:
1)
Who is the target
audience
2)
What is the message that
should be conveyed
3)
Where should the message
appear
4)
When should the message be
received
5)
Why should the company send
out the message and why should he audience be
interested
6)
How should the message be
conveyed
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Media
Exposure
Companies want media exposure.
Depending on their industry, they want to be on the front page of
the Wall Street Journal or on a leading talk show such as Oprah.
Before formulating a PR
campaign, it is important to understand what news
is.
There are three
categories of news:
Hard
News – the front-page news, normally dealing with crises,
disasters, crimes and scandals. Placement in the hard news segment
is important for PR professionals dealing with crisis
management.
Category
news – semi-hard news specific for a category, such as
business, law, trade, commerce. Exposure in category news is ideal
for companies and a tough call for PR practitioners due to the stiff
competition to be covered.
Miscellaneous
– all other news that is not category-specific or hard news. For PR
practitioners, it is the easiest venue to get exposure but difficult
to identify.
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Press Releases
The easiest way to get a
company "on the map" is putting out press releases.
The impact of
press releases has changed in the last couple of years.
There is
a trend to look at other PR tools as
well such as VNR.
Press releases are still
effective if handled the correct way:
a)
Make
sure the press release is newsworthy - avoid product
upgrades, internal job moves of management and non-exclusive
distributor/strategic partner appointments. Deals or contracts with
a money value to it are newsworthy.
b)
Make
sure the press release is written in compelling language –
although press releases have a certain format, the message should be
appealing in style, tone and flow
c)
Make
sure it is distributed to the relevant media. There are only
a few real news wire services (AP, Reuters, Dow Jones, syndicated
news services) that normally don’t run press releases. The rest are
companies (PR Newswire, Scripps) that distribute press releases
against payment.
d)
Make
sure to follow up – press releases should be send out with a
certain regularity to show the company’s consistency and journalists
and analysts should be contacted to get “real” exposure. The
quickest and most efficient way (although not cheap!) is to hire a
PR or IR firm to ensure journalistic content and media
placement.
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Corporate Communications
Corporate communications has to
parts: marketing an corporate.
As part of marketing,
corporate communications is often defined as marketing communiations
or marcom.
It is also part of the
corporate strategy and as such sould also handle public relations
and investor/analyst relations.
In its purest form,
corporate communcations is in charge of all communictions from the
company to its target audiences.
Many companies use the
(polluted) term marketing
communications (marcom) to indicate the department
or person in the company dealing with all communications, sales
promotion, customer relations, public relations, website management
adn graphic design.
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Branding &
Image
One of the most exciting
marketing and PR task is
branding.
Branding is the process
of shaping the image of a company or organization.
It is the way the public
and target audiences perceive and remember the company.
Once a brand is
tarnished,, it takes an aggressive rebranding campaign to restore
faith in the company or organization.
What are the key
characteristics of a brand?
1)
Unique. A brand must stand out
among its competitors and should never be confused with another
brand.
2)
Targeted. A brand must address
its target audience; it a brand is too general, it is perceived as
bland.
3)
Memorable. A brand must be easy
to memorize and recollect.
4)
Sincere. A brand must represent
the company and its offerings- a fashion brand can be trendy and
funky, but a financial institution brand must be solid and
conservative.
5)
Appealing. A brand must hit the
right emotional cord with its target audience.
6)
Consistent. A brand must project
the same image over a long period of time; changing the brand leads
to brand disloyalty and loss of customers and market
share.
7)
Global. A brand must have a
global appeal for two reasons: a) customers are international and
want to find their favorite brand effortless at home and abroad; b)
branding in each geographical market individually
is expensive.
A company has
to start with a branding strategy.
The corporate brand must
support the mission and goals of the company for a long time.
It’s therefore crucial
that the company allocates sufficient budget for both developing and
maintaining the brand.
The in-house
international marketing & PR professional should perform this
crucial task.
This first step is – as
in all mission critical tasks – research, closely followed by
a SWOT analysis.
This research should
concentrate on the industry the company operated in,
competitors and their brand positioning/brand loyalty, and
the tastes and perceptions of the target
audience.
Once the research is
done, the brand must be developed.
This sounds easier than
it is – a durable brand consists of various elements:
Brandname
Often referred to as a
one word commercial, brandnames must be unique and descriptive. Some
companies opt for a brandname explaining the product or service they
offer (Deskjet); others link the meaning of the word itself to their
product (Nike which means victory).
In order to be unique,
companies can also create a word or choose an acronym as their
brandname or opt for the family name of the
founder.
An example of a
successful brandname consisting of an acronym is Ikea
(Ingvar Kamprad Elmtaryd Aggunaryd).
Heineken and Philips are
examples of family names that evolved into a global brand.
Examples of created words used as brandnames are Yahoo! and Vonage.
Sometimes, a brandname
becomes so successful that it develops in a verb indicating the
product application: Hoover and hoovering (vacuum cleaning in
British English), Xerox and Xeroxing (photocopying
in American English) and Google and googled (being
searched on the Internet).
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Logo
An effective logo is one
that people remember. There is a simple acid test to check how
effective a logo is.
Show it to somebody not related to the
company or industry and ask that person one day later to describe or
reproduce it from memory. They will remember the shape and the
color. Soft and fluent lines are best remembered.
Examples are the famous
swoosh of Nike and the letters in the
Coca-Cola logo.
Another way to make logos memorable is the use of strong animal
images, such as Greyhound, Puma and Bobcat. Using fonts is also a
proven success formula: Microsoft uses italics in its logo and the
Heineken logo has three tilted
“e”, thus turning it into a logo and not just a word.
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Company style
The company style
consists of visual elements such as colors, shapes and fonts that
make the company instantly recognizable.
Text is first and
foremost perceived as an image – it is therefore important that the
company develops and maintains a font type and layout style as well
as the use of colors throughout the corporate collateral.
A good example is the
mobile phone company Orange.
Packaging
Especially consumer
products such as soft drinks must have a distinctive shape, without
loosing the functionality. When developing packaging, the company
must form a team consisting of the in-house specialists from the
R&D, marketing and branding department and an external
industrial designer.
The ultimate success
story is without any doubt the famous Coca-Cola bottle.
Collateral
Branding defines how the
collateral looks, but collateral can also brand a company.
Especially gimmicks (Kipling’s monkey), events
(Heineken Jazz Festival) or outfits (Playboy) brand a company. In
some industries, jingles are used for branding (Nokia).
Once the concept brand
is there, a SWOT analysis must be performed to check the
viability of the brand.
Branding is not only a critical, but
also an expensive activity.
In case a brand is launched
incorrectly or turns out to be ineffective, only rebranding can save
it.
Rebranding is both time and budget consuming and should only
be done in case of mergers & acquisitions or as part of the
company’s repositioning in the market or
industry.
The final step in the
brand launch, followed by maintaining and
sustaining the corporate brand.
In
some cases, before launching the brand officially, it might a good
option to test the brand in critical markets, especially if the
company is a global one.
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