Examples of small and large companies using Social Media in Investor Relations
26 May 2009
They may differ in their size and sector, but Canada Gas Corp. and Barrick Gold both agree there is value in using social media. I recently sat down with representatives from each company to discuss why they have adapted it into their online communications plan, how they use it and some words of wisdom for anyone looking to integrate it into their business strategy. What follows is an overview of those conversations.
CANADA GAS CORP.
Canada Gas Corp. is listed on the TSX-venture exchange, The Frankfurt exchange and the OTC Bulletin Board. The company has two natural gas projects located in the foothills region of the prolific petroleum and natural gas bearing Western Canadian Sedimentary Basin in northeastern British Columbia, and has just acquired two opportunities to explore for Bakken oil in Saskatchewan.
The above is the company’s standard boilerplate. However, CEO, Chad McMillan paraphrases a little and states Canada Gas is a small, venture company currently rebounding from the economic turndown, looking to build out and grow through innovative ways of engaging people and expand their overall following. This philosophy carries over into their use of social media.
WHY AND HOW SOCIAL MEDIA IS USED WITHIN CANADA GAS
Canada Gas’s adoption of social media stems from Chad’s personal use of facebook (FB) – he was a late user but followed the development of web tools and the evolution of different social networking sites which he felt were very efficient and engaging in many respects. Once he signed on and had been using it for a while, he realized FB was evolving towards the corporate side of things. He also gained a huge network of associates following Canada Gas and while he felt the corporate aspect was not quite complete yet, companies were gradually signing on, so he thought he would give it a try and in the early part of 2009 also began using it for the company.
While it helped that other companies were gravitating towards using FB, one of the main attractions for Chad was that all web 2.0 concepts are user generated and Canada Gas’s main strategy is connecting with people looking for energy investments, attracting star talent and potential partner opportunities.
Also, in addition to working with Canada Gas, Chad (and his colleagues) works with several other smaller companies. As you may assume they have limited budgets and he was looking for ways to leverage their capital although the forefathers of these companies were somewhat skeptical of new methods. So with his communications background he helped bridge the gap with not only key investor tools such as the core presentation and the IR Website, but also social media.
Currently, Canada Gas uses Twitter, facebook, linkedin and encourages forum participation – Chad has re-tweeted press releases and interesting things happening in their sector thus far and has even advertised for an annual report designer. As the company continues to evolve, so will the social tools they use – Chad foresees using video blogging or some kind of shareholder forum but for now he is experimenting one step at a time. Among venture-listed companies using social media, Chad and Canada Gas are one of the early adopters and so he has been helping others understand and realize their potential.
For those of you from smaller companies, you are likely thinking I don’t have the time to do all of this and Chad doesn’t want to lead anyone into thinking that things will happen overnight. He has a lot on his plate and there are only so many things you can do as a small company. So the initial priority for them is building a better foundation for the company and as the markets come back, it will provide more opportunity to work the tools better. He also feels there is a lot of research about the benefits and things are evolving so rapidly that for now they are taking “baby steps”.
Don’t get discouraged by this – he strongly feels Canada Gas is at an advantage because they are smaller. For example, they can easily integrate an accounting system or any other tool to enhance their business in a shorter period of time. While they don’t necessarily have the resources, they have less layers to peel back to get buy-in. He compares this to larger companies who have internal processes and many different departments that need to collaborate which makes it hard to get things done in a timely fashion or implement change at all.
WORDS OF WISDOM
When asked some words of wisdom he states that you can’t forget the basics of what you are doing in your core IR program, but you shouldn’t let that stop you from being an entrepreneur and try new things out.
You need to look at the bigger picture and instead of just pushing your releases out using the same avenues, social media empowers people to engage with your company and in the process gain a better understanding of your business model. Those that don’t participate will be left behind and as communication tools continue to evolve, companies need to keep apprised of them and use what works to achieve their underlying goals.
Barrick Gold Corporation is listed on the TSX and NYSE. Barrick is the gold industry leader, with a portfolio of operating mines and projects located across five continents, as well as large land positions on some of the most prolific mineral trends.
WHY AND HOW SOCIAL MEDIA IS USED WITHIN BARRICK
Barrick’s use of social media began in October 2008 with Twitter to increase the level of interaction between the company and its stakeholders. Subsequent to this, in April of this year they established another Twitter feed (@barrickgoldjobs) as well as an official facebook page for recruiting activities.
Their initial use of Twitter entailed circulating press release headlines by providing a link to the full release. Over time, they began receiving questions and comments in @replies and direct messages, and responded to them as they arose. After gaining some comfort with the medium, they began to be more broad with posts and interacted with their followers more. They also followed related media outlets, and other sources of information to stay up-to-date.
They now Tweet about upcoming events, new content posted on their website, and issue reminders of quarterly earnings and conference calls. As mentioned, in April of this year, they launched a Twitter feed specifically for recruiting purposes (@barrickgoldjobs) – in which they post employment opportunities, link followers to the Career section of their website, and respond to questions from potential candidates.
WORDS OF WISDOM
Social media is a great way to make your organization more accessible to your stakeholders. In the case of Twitter, you can be sure that your followers want information from you. Watch how other companies use social media and develop a vision of how it might help your organization. This type of ongoing assessment is a good way to develop and update your strategy.
However, they would like to point out that before they adopted Twitter and Facebook, there were internal discussions to ensure that any related social media activities were in full compliance with the company’s disclosure policy and recommend you do the same.