MIFID II went into effect January 3rd of this year, which means asset fund managers now must budget separately for the analyst research they’ve historically bundled into trading fees. For large cap companies, the impact will be negligible. But for medium and especially small cap companies, this poses a real threat to their long-term share liquidity. Instead of being able to rely on analyst coverage to get their investment story in front of institutional investors, IR teams will now have to work a lot harder at communicating their equity story.
Against a backdrop of tight budgets, here are 5 tips to help hard-pressed IR teams ensure that their digital channels are optimized to support this process.
1. Get your story straight
While your Annual Report provides a comprehensive overview of your business, are you able to succinctly articulate your equity story so it is easily understood and evidenced? Are you able to clearly differentiate your business from peers within your sector and quickly respond to shifts in market forces? Be sure to establish a communications plan with your key USPs at the center.
2. Be consistent
Digital communications know no boundaries. Ensuring consistency of message across your different channels and audience groups is a tough challenge. Any online content that does not support the equity story needs to be either updated or taken down. Outdated website pages, old blog posts and old or broken backlinks can all show up in search results, potentially undermining the work you have put into developing your narrative. If there are multiple teams within your organization creating corporate content, make sure that there is governance in place around its life cycle, and that all new content is reviewed and approved before being published.
3. Keep it engaging
When it comes to communicating online, less is usually best. You should see your digital channels as a store front, not a library. If you can get your intended audience engaged, they will be willing to spend a bit more time downloading diving deeper to do further research. Keep written content to a minimum. A short video with an associated download is more likely to get noticed and generate higher engagement than a long-written narrative. As a rule, diagrams rarely work online; simple dynamic charts are a much better format.
4. Provide regular updates
In the digital world, ‘timeliness is next to godliness’. However brief, regular updates in support of your equity story are crucial, with press releases or short articles a great fillup between more comprehensive financial updates and presentations. If you do not have the capability in-house, consider retaining an agency or freelancer. Investing in quality journalism, optimized for your target audience may seem like a luxury, but will deliver assets that generate engagement, have a longer shelf life, and a greater scope for reuse.
5. Plan ahead
Being able to easily repurpose and publish content across all channels is key. While this may seem daunting, with a bit of forward planning you can make effective use of time and budgets. Think in advance about the format of management updates and roadshows, and how to structure them to be used as the basis of broader communication efforts. Make sure that the timing of communication and marketing activities is aligned for maximum coverage, and that it reinforces rather than detracts from other investor focused activity.
Corporate digital communications serve the needs of many different internal and external stakeholders, but principally among these are existing and prospective investors. With MIFID II, companies will need to work hard to get their equity story at the front and center of all engagements.
As experts in digital communications, with 18 years of investor relations experience and counting, find out how Investis could set you up for MiFID II success.