How video can help tell your investment story
25 July 2012
Last week we shared some best practice case studies from our ongoing research of how public companies are interacting and engaging followers on Twitter. This week, we are going to share some best practice case studies of how companies are using YouTube and Vimeo to help communicate their investment story.
Our research has found that public companies? adoption of video- and presentation-oriented social media such as YouTube (and SlideShare) is quite a bit lower than the adoption of channels like Twitter and Facebook; however, use is definitely on the rise and the trend is likely to continue.
Among the companies who are using YouTube for IR, many create separate playlists for customers and investors, and then link to the IR videos from the IR page of their corporate website.
Video can be a very effective way to communicate why and how management is investing in projects that may dilute short-term earnings or cash flow, but should create long-term value. Mining projects are an excellent example. Videos show how capital assets have already been deployed ? drilling rigs and roads created, for example ? and demonstrate the need for additional capital assets, while allowing management to talk about the long-term potential: yields, proven and likely reserves, etc.
The reporting of an acquisition is another good example. There are two components to a successful merger ? strategy and execution ? and video is a good way to explain both. The most common way to articulate the expected benefit of a new merger is having the CEO (along with the CFO) speak directly to a camera or interviewer. Video can also demonstrate effective post-merger execution in the form of testimonials from satisfied customers, analyst comments, positive product reviews, and financial results.
Best Practice Examples
Xerox uses YouTube to effectively communicate their acquisition of Affiliated Computer Systems. In a video uploaded on February 8, 2010, CEO Ursula Burns explains how she envisions the merger adding shareholder value (http://youtu.be/N8KNcBflcKM). A video uploaded 364 days later (http://youtu.be/LDYkjfM3nLM) details the progress made.
The one-year anniversary video shows numerous positive headlines from newspapers and websites, demonstrating that when companies are generating positive ?buzz,? video can be a very effective way to consolidate all the positive feedback and present it quickly to investors. Also, the combined effect of the CEO articulating the vision and independent sources confirming that the vision is being realized ? is a highly effective way to communicate that Xerox is executing their strategy.
They create videos of their Annual General Meeting (http://vimeo.com/23228632) quarterly results (http://vimeo.com/20839385) and key projects (http://vimeo.com/20839385). Their 3-D models of ore deposits are a good example of how computer-generated visuals can effectively communicate complex and or technical issues to investors.
Advanced Micro Devices
In this video made on “Financial Analyst Day 2010” (http://youtu.be/-SoOcrjzAw8) AMD adds the voices of their key marketing, sales and technical people to their CFOs report. This is an effective and succinct way to move IR videos ?beyond the numbers? communicating strategy and execution.
AGCO provides a complete and thorough corporate overview in their ?About AGCO? playlist (http://www.youtube.com/user/agcocorp). They have videos about their corporate vision, history, global presence, brands, and key divisions. In addition, the Investor Relations page on their corporate website (http://www.agcocorp.com/company/investors.aspx) links to the videos, making it very easy for investors to find and cross-reference video information from source to source.
Though AGCO has a YouTube channel for dissemination of video content, they use Realview TV to produce quite a lot of their official content. Interestingly, their corporate website IR page does not include a YouTube link of any kind, but has a button linking to a video micro-site hosted by Realview TV: http://video.realviewtv.com/corporate/agcocorp/. The content on YouTube is much greater, including almost 500 videos of various types, whereas the Realview TV player provides one video for each of the 12 playlist topics (presumably, the most recent one made). Linking to the more robust and informative YouTube content from their IR webpage would seem to be an obvious move to make it easier for investors to find the information they need.
Next week, we’ll share some best practice case studies for using SlideShare for IR.