The REIT industry is beginning to realize the benefits of social media in investor relations. While Wealth Management suggests that 2017 will be a strong year for REIT performance, organizations still need strong communications plans in place to manage investor relations and raise brand visibility.
Because of the way REITs are structured, they must pay out a majority of their profits to shareholders, who are anxious for regular updates about how trusts are performing. Social media provides a channel to both share and amplify critical information. Here's a closer look at the benefits of social media for investor relations and how it can work for your organization.
Understand guidelines around investors and social media usage
First, you need to understand and plan for potential complications. According to Investor.gov, an online resource for investors run by the SEC, the U.S. government has issued warnings to investors about the potential for fraud when companies discuss investment opportunities through social media platforms. The SEC has ruled, however, that companies can use social media channels to connect with investors and alert them of important information. This sentiment is reflected as well by comments from the Financial Conduct Authority in the UK, which recognises social media channels as "powerful channels of communication and therefore of significant value to firms" in it's 2015 Social media and customer communications guidance statement.
Leveraging social media as a way to communicate with existing investors and share general information — rather than as a way to solicit direct investments — can help you strategically amplify your message and brand position without harming your image or running into regulatory challenges.
Determine your purpose
Social media can help REITs highlight the right content, build their brands and raise investor confidence. But for REITs that engage on different platforms, capturing the benefits of social media in investor relations requires a clear plan. Focusing your accounts on brand visibility and investor relations, for example, is different from using your accounts for tenant communication. Each social media channel may be optimal for a particular target audience and outreach purpose.
Align your communications with your evolving story
Relying solely on a static annual report can result in long gaps in communications with investors. Investor relations pages on REIT websites accounted for two-thirds of page views by investment institutions, according to research conducted by Investis. However, these pages typically provide too little information that is published too infrequently to keep up with investor's demands for up-to-the-minute insights on how the trust is performing.
Trusts should have a strategy to regularly share updates on portfolios, recent property acquisitions, awards and other noteworthy events via social media channels. Consider which aspects of your company's narrative you want to shape, and use social media as another strategy to cast a spotlight on that information.
Our research has found that one-third of global REITs failed to share key portfolio information, even though portfolio details are one of the most important pieces of an REIT's larger financial picture. Yet, major portfolio developments can easily be shared on certain social media channels as part of your approach to investor relations. Consider how smaller bits of information that would traditionally be shared during reporting or press releases could be recapped for social channels. Be sure to have a clear plan for how you'll leverage each of your social media channels.
Employ social listening
Engaging on social channels does more than provide another avenue to share information. REITs can use social listening tools to monitor the conversations around their brand and properties. It can also be used to stay up to date on the industry at large and keep a pulse on the conversations happening among target audiences. By being aware of concerns or points of contention, it's possible to launch a PR campaign or systematically address issues before they're blown out of proportion.
For REITs, thinking more expansively about investor relations and communications can help ensure that their investors remain informed and happy. Social media provides an important channel for sharing and amplifying news that appears in other formats, such as formal reporting and press releases. Post frequently and strategically to social media, watch for responses and monitor mentions of your brand.