When National Investor Relations Institute editor William Mahoney wrote his book Investor Relations – the Professional Guide to Financial Marketing and Communications, he discussed relevant technological trends. He didn’t go into the personalization of IR web sites. In 1991, who would have expected him to do that? On the other hand, who would have expected KC and the Sunshine Band to still be performing disco music or the Rams and the Titans in the Super Bowl at the start of a new century?
Today’s investor relations world is becoming as ‘wired’ as the Borg Collective on TV’s Star Trek Voyager. And personalization is becoming the hot item at corporations from manufacturing giant Ingersoll-Rand Co to food products supplier Synergy Brands and at web site firms from CCBN.com in Boston to Kostech Corp in Reno, Nevada.
Simply put, a ‘personalized’ home page is one that has been customized to meet the needs of the repeat registered visitor seeking specific information and tailored e-mail systems. Online retailers have been the pioneers. Think of Amazon.com: the web site greets regular customers by name, and suggests new books and music that might interest them based on past purchases. Or, you can register to receive e-mail about new releases. According to investor relations experts with their eye on the cutting edge, this kind of personal customization is now coming to IR sites.
Why would this be necessary? Because, as Michael Reilly, president of Babylon, New York-based Hally Enterprises Inc. (www.hallyenterprises.com) observes, ‘Given the randomness of data distribution and organization on the internet, there is time to be saved. An investor with 20 stocks has to navigate through varying environments to find information, a problem which can double or triple in complexity when seeking comparative data. This search can be even more demanding for professionals seeking non-standard or company-specific data. With personalized notification systems, searches might be trimmed dramatically or eliminated.’
He says personalized systems can ensure timely arrival of information for the user. ‘With live access, an individual can receive information as soon as the best equipped professional – a significant leveling of the playing field,’ Reilly notes. ‘The SEC has received scores of complaints about uneven disclosure and is mounting an effort to encourage use of the internet to help with the problem. Personalized ‘push’ technologies can ramp this up.’
Warm & fuzzy
Still, Reilly believes that the internet is not a substitute for all personal relationships. ‘It is an extension. You reach people that you would otherwise never meet. If they have a warm and fuzzy – useful, personalized – user experience on the site, satisfying their investment needs, a loyalty can develop which will pay dividends just as much as face-to-face relationships can.’ Building such a strong, lasting relationship is the ‘biggest ultimate advantage,’ of a personalized web site – ‘stickiness’ in today’s vernacular.
Carol Baroudi, a senior analyst for Framingham, Massachusetts-based Hurwitz Group’s Electronic Business Strategies unit, has dealt with companies which have internet personalization programs and contends there are ‘no serious e-commerce or IR sites without personalization.’ That covers recognizing a user, remembering their profile and preferences and history. Without personalization, she adds, ‘a user has no particular motivation to return to the site and may as well go elsewhere.’
Even on sites that don’t require a user to register, she maintains that personalization software can track where a user goes and can use that information to put out appropriate content. Some personalization solutions include ‘micro-segmentation – narrowly defining a particular audience – and customizing content and process for the segments.’
Baroudi believes shareholders benefit from a personalized experience which ‘directly impacts a company’s ability to achieve higher shareholder satisfaction and retention rates. Stockholders benefit from association with a company that has established strong shareholder loyalty.’
She argues that up-front costs ‘are not prohibitive and personalizations aren’t actualized out-of-the-box. They require sophisticated talent on the part of the implementor, software vendor or systems integrator.’ Each web page is ‘unique and may require integration to extensive databases and other internal information systems.’ Still, there is ‘no doubt the winners in this new economy understand personalization is a critical component of acquiring and retaining shareholders.’
Achieving stickiness
In agreement is Andrew Corn, president of Admaster Communications in New York. He says achieving stickiness with shareholders is part of what lies ahead and ‘is based on the amount of information that can be provided by information sources which are linked into a public company’s web site.’ And that pool of information can only grow, since the web is ‘the place to go for the first round of information. The near-term next wave will offer true data-based inquiries of financial information, a download or on-screen version of precise data by date, type, and calculation as well as what scientific notation you choose.’
According to Dave Stoltzfus, chief technical officer for New York-based Logical Design Solutions (www.lds.com), online customer care is divided into three areas: self-service transactions, such as enabling customers to exchange money mutual funds; problem resolution, such as a telephone company site which allows customers to dispute a bill, and, finally, information requests, which enables users to gather information through personalization.
Stoltzfus maintains such online care ‘gives shareholders control over the information they access and when they access it because the internet is open 24 hours a day. That leads to another benefit: convenience. The value richness of the web makes it a better medium for customer care than other options because the web enables you to model information and allow you to personalize the information.’
He says that in the personalization process there are questions to be answered. ‘Are page elements easy to read? Is the type legible and consistent throughout the site? Are graphics used for functionality or ornamentation? Is the site intuitive and easy? Do all features function properly?’ Stoltzfus concludes, ‘The bottom line is that you can’t afford not to set strategy for your site. It doesn’t add time; it adds focus.’
Into the swing
One corporation already into the swing is Ingersoll-Rand Co, according to Claudia Barbiero, manager of new media and information services for the company headquartered in Woodcliff Lake, New Jersey. She says Ingersoll-Rand’s web site was revised recently ‘to better serve our investors’ needs.’ The new site, managed by Boston-based CCBN.com, now lets investors register for automatic e-mail notification of financial news releases, conference call information and analyst presentations.
Barbiero explains the centerpiece of Ingersoll-Rand’s foray into personalization: a customization tool called YourOffice@Ingersoll-Rand. ‘When users register for this feature, they select the areas they are interested in and receive notification when new information is available. They also can personalize their YourOffice by bookmarking their favorite pages from our web site and maintaining a contact list. Essentially, YourOffice allows users to create their own Ingersoll-Rand home base.’
Investor portal sites are another area of the investor space where personalization is coming into use. Ubrandit.com, a San-Diego based firm, specializes in using its branded web sites to ‘drive traffic to existing investor relations web sites. Spokesperson Amy Martin describes StockStudy.com as the company’s ‘flagship’ financial information site, ‘which allows subscribers to receive instant IR information on any publicly-traded company. It provides stock quotes and charts, personal portfolio management, news releases and editorial content.’
When companies sign up for Ubrandit’s IRpackages.com, they receive a package of three Ubrandit.com financial information sites: IRpackages.com, Newsletters.com, and StockStudy.com. ‘To personalize IRpackages.com, a company goes to www.ubrandit.com and selects ‘brand your site today’. That brings up a form to provide Ubrandit.com with contact information, web site URL, company logo, and color scheme,’ Martin explains. Upon completion of the sign-up process, the company will be able to view, link to, and use the new financial information site. Technically, the sites ‘aren’t part of a company’s own web site, but visitors never realize they are leaving the company site. From then on, users will be able to request and receive IR packages, receive detailed stock quotes, customizable charts, and financial editorial from StockStudy.com and financial newsletters from Newsletters.com.’
Psychological implications
All of this has great repercussions, according to Gary Fishman, managing director of Hudson Stone Group IR consulting firm in New York City. ‘Personalization has a psychological aspect in the investment community and then in the media. A shareholder who gets tailored information is a more informed and satisfied investor and this translates into benefits which include increased liquidity, valuation and shareholder value. This can fuel corporate growth to fund acquisitions, reduce debt, and create powerful management and employee incentives via option and 401k plans.’
With all of this in mind, what lies ahead in IR web site personalization?
The ‘next wave’ will include ‘your view of the site,’ Admaster’s Corn adds. He means the ‘My Yahoo’ or ‘My Amazon’ concept, ‘except taken a few steps further. The extra steps are personalizing/customizing the site; value-added software for greater ‘personally-chosen’ interactivity; passwords to special areas; streamed video; notification of events, and collaboration on questions and answers.’
For Corn, the real question is: ‘How far is the IR industry willing to go to support and promote corporate images and stock?’
