By Abe Smith, President, EMIA, Cision
Social media is now such an established part of our media landscape it can be easy to underestimate its value.
For instance, with so many daily tasks for Investor Relations (IR) professionals to complete before the markets close, social media monitoring is often deprioritised or can be simply left to PR. Understandably, it can be very difficult to keep a finger on the pulse of social media activity amid the tumult of tracking share prices, coordinating shareholder meetings and releasing financials.Understandable, maybe, but the experts say it is wrong.
Remember, the ‘always on’ nature of social media has given the wider community of consumers a mighty weapon. And, not only does the impact of a negative social media storm hit a company’s reputation, but, in recent years a social media backlash, has become intrinsically linked to the financials of a business.
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Several companies learnt this the hard way last year. Among them was Ryanair, the Irish low-cost airline, which recently suffered a reputational scandal following a widespread cancellation of flights due to poor pilot holiday planning. The announcement triggered outbursts of outrage on Twitter and #BoycottRyanair quickly trended. As a result, Ryanair’s shares dropped significantly and – at the time of writing – are yet to fully recover.
In the US, another airline – United Airlines – faced a similar backlash after an incident where a passenger was forcibly removed from one of its planes. Social media posts of a passenger being forcefully removed from an overbooked flight went viral, and United Airlines’ share subsequently fell by 2.5 per cent. Clearly, this reinforces the importance IR teams should place on monitoring social media activity and understanding its impact on share price.
Social awareness is crucial
Customers often use social media to publicly praise or criticise a company. At the same time, many businesses do not treat investors as customers, and therefore overlook how and where they consume information. According to research conducted by Greenwich Associates, 79 per cent of institutional investors use social media at work, while a third of them confirmed that the information they received through social media has impacted an investment recommendation, or, the final decision, even.
So social media clearly influences the way investors and analysts perceive and rate a company. For IR teams, monitoring social media channels and listening to the noise is an important part of managing investor relations.
Response-time is critical
So, if you agree social media monitoring is a priority and you have set up your social listening and monitoring channels, what do you need to do if you encounter an emerging social media problem?
Timing is crucial. You need to respond as quickly as you can. By reacting quickly, IR teams can help prevent an issue from escalating. Solid crisis plans help you speed up your response and should include a comprehensive media policy as well as guidance for social media responses. Should an emergency occur, everyone, including the CEO, should be aware which approach to take. Reacting clearly and concisely in a crisis can help manage reputation of a brand. It also helps build trust and credibility between the company, its followers and investors.
Promoting company-wide social guidelines
As well as having social media guidelines that address how to react when a social media storm is beginning to gain momentum, guidelines around how employees should conduct themselves online can also help minimise emerging issues.
Organisations have a responsibility to ensure that employees are acutely aware of their responsibilities on social media. Indeed, an ill-advised post from a staffer could have adverse consequences for the reputation of the business.
Keep your ear to the ground
Besides monitoring your own company’s websites, Twitter feeds, LinkedIn accounts and YouTube videos it is also important to keep an eye on competitor’s channels. Understanding what they do and what is said about them gives IR teams a valuable insight. By analysing the online challenges competitors face, IR teams can think about how to address the potential issues they might face themselves.
When IR teams monitor what the social media community is saying about their company, its products and share price, and regularly check if any rumours are being spread, they can react quickly. To do this efficiently, monitoring tools can help them identify influential social media users, and measure the implications of their discussions. These insights are crucial to position a business more accurately within its market, and help troubleshoot issues.