In presenting to listed companies and spreading the word about progressive online shareholder communications there are always two questions that arises from the audience: “most of our investors do not have access to the Internet so why should we bother with our website?” and “nothing is happening in the company at the moment so we will wait until it does to sort out our website”.
This is my standard response in summarised points to the first question:-
- Investors bought your shares on two assumptions: firstly, that there is a market for the shares they purchased and they can sell the shares at a reasonable price. This last point is the crux of the matter. Directors have an obligation to employ all reasonable efforts to ensure that the information to make educated investment decisions is made available. What better complementary medium than the Internet? Low cost etc.
- It can take just one investor to change the fortunes of your company, it may be Mark Mobius or a local institution or indeed your retail shareholders. The benefits of a diverse array of shareholders is well documented in US markets and the same applies in African markets.
- There has to be a holistic approach to a communications strategy. Employ all reasonable means to get the message out. Mix your brand message with your IR message, investors are as important as customers.
- News of the growth in Internet capacity in Africa is coming thick and fast prior to 2010. I have recently been a participant of the roll out of mobile internet in Kenya, it is changing things significantly and quickly. Prepare now for the future.
On the second question my response is as follows:-
- If a new website is launched just prior to a major corporate action, to whom will the website be advertised and targeted? The online media game is competitive and the mere introduction of an online presence is insufficient to get the message out in the short time span of a capital-raising. Listed companies need to have an identified audience and ensure that the very brief sight that an investor has of the website results in a registration or “opt-in” to receive information
- It takes over a year to establish a meaningful online investor relations presence. It’s a process and not an event. Effective SOE initiatives will help but it’s the ability to establish a secure two way communications channel between every investor and you that is key. This builds a community. One off Internet events does not.
Keeping the status quo is not enough in this day and age. Corporate strategy should embrace the Internet. The tools exist and the upside is significant. It takes just one investor to make a difference to your company – perhaps he’s the guy with the computer.