Welcome to part 3 in the series on ideas for upgrading our IR programs in conjunction with the proposed new semi-annual reporting rule.
I’ve never thought annual investor days were very effective, and certainly not worth the hassle for everyone.
Real data bears that out. We should take note of a reputable survey that said that only 6% of investors routinely watch the company investor day broadcasts, instead looking at the presentation materials later. In a different study, more than a third of investors said they skipped investor days because so little new information was presented.
That doesn’t sound like a process worth keeping, does it?
I don’t know about you, but I have yet to meet a CEO or CFO who thought the investor day was a good use of their time. And my legal departments have always been leery of creating duty to update risks with a once-a-year event.
Looking forward to what we should do instead, let’s note that people’s information assimilation preferences are shortening. And the current content of investor days is not optimized for AI search.
Let’s remember what the objective is. All of our communications with the Street should be designed to do two things, one, increase investors understanding of our business, and two increase their belief in our ability to deliver.
But let’s also remember that we are not obligated to give investors all the details they want.
So, one option is to do away with the investor day altogether and rely on our quarterly or even semi-annual calls. A short update on business conditions or our strategic thinking would be easy enough to add in the CEO’s section. And maybe you make it a little longer on the year-end call.
And, you might also add a little more strategy and outlook commentary to your conference presentations.
Another option might be to do one extra call a quarter, besides your quarterly.
Personally, I have found the best success with doing a call every month, one quarterly report and two short, and I mean short, fireside chats. While I think this is a good strategy for any company, I have used it particularly effectively to restore companies’ reputations following misses in results, and other corporate missteps.
These are short. Keep them to 30 minutes most of the time, including Q&A.
These are far easier to do than you may think, for two reasons. First, you can let other executives be the focus of different calls instead of the CEO and CFO. For example, I found it went a long way to build investor confidence in our guidance when I put the head of sales on a call every year to discuss how he manages the sales funnel and pipeline to contracts.
Put a customer on these calls a couple times a year.
Let division heads or geographic market leaders talk about how they run their piece of the business.
Sure, the CEO and CFO are in the room, but they’re there to emcee and make sure the discussion is on track.
But keep the presentation part short. When I put the head of sales on, for example, he only had about 5 minutes worth of prepared comments. The other 20 minutes were questions.
Note that this type of content presentation, focused on specific topics, is much more AI-search friendly.
This is also great training and recognition for your next tier executives. And, for your CEO and CFO, this can cut a significant chunk out of the demands on their time for one on ones with investors.
If you want to really supercharge these fireside chats, let each of your sell side analysts co-sponsor one of the calls every year. I guarantee they’ll help drive attendance and provide questions.
At the end of the day, the annual investor day was a walking dead zombie already. The new pending semi-annual reporting rule gives us a great excuse to change, and we can do something so much better and easier for everyone.
