Archives for March 2009

For most investor relations departments, the Internet and the company website have been a great addition to the arsenal of tools used to communicate with shareholders, analysts, and the media.  But, for all of the online world’s advantages, there are still some things and some people that are just a little better when they are offline.  Mixing the two is just one of the important challenges IR faces.

Annual Reports Online

Offering the company annual report online has become a no-brainer at many publicly traded companies.  In the past, many investors requesting the annual report really only wanted certain information.  Tailoring a report to each user’s specific needs would have been a regulatory nightmare with the necessary disclaimers likely running as long as the full annual report itself.  So, investors requested the annual report, and IR put them in the mail.  Many trees were lost, and many printers grew wealthy.

Fast forward to today, and investors can generally get any company’s annual report with just a few clicks.  Some companies offer online versions which allow the investor to browse through all of the information online without ever leaving their browser.

Other companies offer their annual reports in a downloadable format such as Adobe PDF.  This solution allows investors to save the file to their computer and then review it at their leisure whether online or off.  Additionally, for users that want hard copy, the pages of interest are just a printer away.  The investor gets the best of both worlds, online reading and electronic tools when wanted, and hard copy printouts for highlighting, note taking, and just easier reading.

No longer must an investor wade through 80 pages to find the 6 pages and 4 tables that they are actually interested in.  No more skilled investor relations professionals spending 3 hours a day in the mail room pasting labels.  No more clear-cut forests, and the sons and daughters of the printers now go to state schools.

But, is something missing?

Hard Copy Reports in the Mail

It is easy, and perhaps unfair, to stereotype the investor who wants a traditional printed annual report mailed to them as older or technologically behind the times.  IR departments still dutifully mail out full hard-copy annual reports to multitudes of shareholders.  But, there are many investors and potential investors who are technologically savvy but, for one reason or another, want to get a printed copy of the annual report in the mail, not a file to download.

For these users, the IR website can accidentally become a fog of semi-confusion.  As they click around the site, they may become more confused as terminology changes, links go to places they did not expect, and the simple question they have, “How do I request an annual report to be mailed to me?” seems to go unanswered.

One frustrated user resorted to posting a comment to an article here on Good Investor Relations Websites, no doubt after arriving via search engine query that apparently did not contain the exact words required to get the answer he wanted.

Ironically, the information the investor wants is very easy to get.  The catch is, that you have to know the difference between what you want and what it is called on the website, and that is where an investor relations team needs to bend over backwards to ensure that everyone can get what they are looking for, regardless of whether or not they speak “IR”.

Consider the household giant Proctor and Gamble.  In many ways, PG could be the poster child for an easy to use informational IR website.  The Investor Relations website is easily found via a prominent link in the main menu across the top of the company’s main page.  The site constrains its width to ensure proper function even with older monitors or small laptops.  The landing page has easy to follow navigation to virtually anything an investor could want, including the Annual Report.

Click the first link (the heading is not clickable) and you’ll find yourself in the online annual report, just as promised.  If you clicked hoping to find a way to a non-online annual report, you are still in luck, but only if you look very closely.

Of course, clicking this link goes straight to downloading the PDF, so depending upon your connection speed and how you have your browser set up, you could be in for a bit of a wait.

There is of course, the archive, and the Financial Report menu and tab, all of which go here.

Again, information galore, but no place to get the hard copy.

Right about now, if you work in IR, or analyze their websites (or other websites), or if you know something about usability studies, or if you are just one of those people who spends a lot of time online, you might be screaming, “There it is!” while pointing at either Contact Us or Request Information.  And, you would be quite right.  In fact, if you pay attention to the bottom status bar, you’ll notice that the “Request Information” link points to a file called annual_report_order.html!

So, yes, there it is, right in front of your face.  That is, if you know what you are looking for.

Consider the investor who does not spend hours on the Internet.  Perhaps a small business owner running a very successful enterprise which is so successful precisely because he spends 10 hours a day in his shop assisting customers.  After a long day at work he spends time with his family, not online.  When he heads to the PG website — he actually typed www.proctorandgamble.com but that’s ok because the company thoughtfully redirects to PG.com from that domain name – he wants to fill out a form and get a copy of the annual report.  So, why not click Contact?

Many users are used to “contact us” being some bottomless pit email account that is read and responded to by an intern buried within the bowels of the company somewhere underneath the mailroom.  That isn’t where he wants to make his request.  Besides, the whole reason he came online in the first place instead of making a phone call was because he wanted to do it quick and easy at 11:00pm and consider it done.

Best Practices

In the end, the company does everything right.  The PG IR group offers up a smorgasbord of easily accessible and usable information, and yet, just one nuance can put an investor’s objective tantalizing out of reach.

What is an investor relations department to do?

1. Remember multiple terminology – just because someone who works around investors all day long knows that report and results often mean the same doesn’t mean that everyone does.
2. Make It Obvious and Then More Obvious – don’t just put “Contact Us” on your site, let people know why to contact you.  An investor FAQ can do wonders.  Anyone looking for info is likely to read a section called Frequently Asked Questions.  Inside, they can find and answer like, “Use the Contact Us link to request any printed materials.”
3. Link It More Ways – Just because the link is there on the landing page doesn’t mean the same info can’t be linked from more pages.

Keep these concepts in mind, and you can have less confused shareholders every day.