Does your CEO jump at the chance to be in the media spotlight or hide when a reporter calls? While CEOs often go on the road, talking endlessly to customers, analysts and investors, many neglect one of their most important audiences – the media. It’s surprising how many CEOs of Fortune 500 companies are notorious for not speaking to the media. Maybe they don’t realize that if they don’t grant interviews, they relinquish control over how their company is portrayed in the press.
If your CEO isn’t taking advantage of interview requests, your company is missing an important opportunity. Media coverage (when positive) is a powerful tool that can increase a company’s profile with customers, partners and institutional investors. It also builds credibility for a firm’s products or services. In a nutshell, media attention can translate into free publicity.
The CEO is often synonymous with a company’s brand, image and true value in the eyes of investors and analysts. A media-friendly CEO is, therefore, a company’s best spokesperson. In talking to the media, the chief executive gets the chance to showcase honesty and integrity, and relate a firm’s story in an unfiltered way.
Pawning the task of media interviews off to the IR or PR person can be the kiss of death in terms of building credibility with the financial media. The media is not usually interested in talking to the IRO because an IR quote is not worth as much as that which comes straight from the horse’s mouth, so to speak. The reason is simple: readers and viewers of the media don’t lend as much credibility to information coming from a company spokesperson.
3rd party endorsement
Some IR consultants claim the media is the most important and potent medium to get your company’s story out. In this sense, media interviews are similar to marketing because, depending on the context, a mention in the press implies endorsement.
While the tangible benefits of being open, forthright and accessible to the media are somewhat elusive, it certainly helps when a potential investor has already read about a company in the press. In some cases, investors are more apt to invest when they have already heard about a company through a third party.
Robert MacDonald, the current chairman of Allianz Life, has experienced the positive effects of media coverage. A few years back, when MacDonald was CEO of Allianz Life, Peter Lynch, then manager of Fidelity’s Magellan Fund, called him to learn more about an Allianz affiliated company. Lynch had just finished reading a magazine article mentioning the company. The article sparked a personal meeting with Lynch, which eventually translated into a significant investment in the affiliate. As MacDonald says, ‘If you have media coverage, investors on the buy side may read it.’
While a media article is certainly not the only thing analysts and investors consider, it serves as another way for them to gain a sense of the company and its top leaders. ‘I read every single article I can find about management,’ comments Val Jensen, chairman of Jensen Investment Management, which manages $750 mn in assets. ‘The stories influence my thinking [about a company].’
Sometimes it’s a crisis that drives the CEO of a company – willingly or unwillingly – into the media spotlight. When Roadhouse Grill filed for Chapter 11, CEO Ayman Sabi walked into the media limelight and proved to be an open, honest and funny person who used the crisis as an opportunity to build relationships with reporters. Now, after emerging from Chapter 11, the company is going back to those same reporters suggesting stories about their new menu items and all-you-can-eat specials.
Convincing the boss
So what can you do if your CEOs object to interacting with the media? Remind them that if they won’t chat it up with reporters, your competitors surely will.
As for CEOs who complain they have no time to bother with reporters, suggest that investing a few minutes now has the potential to save multiple hours spent on damage control later if rumors are allowed to circulate or allegations go unanswered.
How do you handle a CEO who is convinced reporters are just digging for dirt? Explain that there are plenty of positive articles that hit the media. Talking directly with the media gives a CEO the opportunity to directly mold the perception of the company. A CEO who is available, honest and candid with the media can mitigate problems. They can also project a company’s story to the public at large.
Dan Sondhelm is vice president and partner with SunStar, a strategic media relations and consulting firm in Alexandria, Virginia. He can be reached at +1 703-299-8390 or [email protected]
