Is Your Investor Relations Plan Fit? Consider These 5 Steps.

By Dennis Walsh, Senior Consultant & Director of Social Media

As another year comes to a close, two things are probably on every IRO’s mind: New Year’s resolutions and next year’s investor relations plan.  Every year, one of the most common resolutions is to get fit.  People spend a tremendous amount of time and money developing new health and fitness plans to achieve that goal.  This year, apply the same techniques to your IR plan in order to have a successful 2012. 

Establish Achievable Goals

You may not be ready to compete in the Arnold Classic body building competition next year, but fitting into that new bathing suit by summer is certainly a realistic goal.  When developing your 2012 IR plan, set equally realistic expectations.  For example, expecting to grow your capitalization from a mid-cap to a large-cap in just a few months is likely an unrealistic benchmark.  Instead, focus on more achievable metrics, such as meeting with a greater number of investors, attending more conferences, or increasing trading volume.  Meeting these goals will support your ultimate goal of maximizing shareholder value.

Be Consistent

Unfortunately, there is no pill that you can take to achieve instant weight loss or meet your desired fitness results.  It requires old-fashioned hard work and a healthy diet.  Similarly, you need to work just as hard on your outreach strategy every day in order to drive measurable IR results.  Develop a long-term calendar of IR events and stick to it.  Don’t make excuses for not attending events.  Just because the most recent earnings weren’t stellar, doesn’t mean you should avoid attending an upcoming investor conference.  Also, investors do not typically buy in after just one meeting, so be sure that you have a follow-up strategy in place to keep analysts and potential investors abreast of new developments.  Have a working pipeline of news releases in place to serve as updates on your company’s strategic progress. 

Use Supplements

In fitness, there will always be a debate over how effective supplements, such as energy drinks or protein shakes, are at improving your results.  Some swear by them while others prefer to go supplement free. In investor relations, service providers are like supplements that can help support the effectiveness of your IR program.  For example, there are many new social media products out there, and it can be confusing when determining which are best. In addition, there are other service providers that can help with investor targeting, arranging meetings, stock surveillance, video production, etc. Test them out to determine the most effective provider to help you meet your goals.  Remember: there is no “one-size-fits-all” IR program.

Hire a Trainer

At the gym, even the experienced athletes can benefit from working with a trainer. Consider the possibility of engaging an IR firm. It is often valuable to get an outside perspective on how to improve your program to drive better results. IR consultants can help you transition from being reactive to proactive in your IR outreach efforts.  There are a number of firms out there, so make sure the one you select understands your goals and that the chemistry is right.  After all, you will need to welcome them in as a trusted partner in order for them to be most effective.

Measure Results

Everything comes full circle.  Whether it’s monthly, quarterly or annually, you will need to measure your results. In fitness, you can track your progress by measuring weight loss, improved stamina, changes in your diet, etc.  Most importantly, at the end of the year you need to ask yourself if you feel fit and healthy.  Measuring results also are important in IR.  A recent study by NIRI of investor relations professionals found that 73% set specific goals and objectives for their plans, with 79% doing so on an annual basis.  The success of an IR program can be measured on everything from relationships with the investment community to the growth of the company’s social media following. Produce a results report on the metrics you determined at the start of the year and deliver it to management and your board, if possible.  Use these results to develop your plan for the following year.

Keep these five steps in mind as you think about your New Year’s IR resolutions and where you want to be at the end of 2012. Challenge yourself, physically and professionally — and get fit in 2012. 

Dennis Walsh is Senior Consultant & Director of Social Media at Sharon MerrillHe counsels clients on a broad array of investor relations and corporate communications issues such as market research, competitive intelligence, earnings announcements, investor targeting, roadshow planning and social media.

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