Unlike certain more covert professions, IR is an open book. IROs have the advantage of being able to ply their peers for tips on the trade or simply surf the web to find out what competitors are doing in a number of areas including financial reporting, governance and annual reports.
Those currently interested in learning about best practice in webcasting should check out Vodafone’s webcasts. According to the latest CTN webcasting survey, the UK telecom runs the best webcasts among the UK’s largest companies. This annual survey scores the webcasts of FTSE 100 companies based on quality criteria including technology, innovation, usability, delivery and production. It also identifies emerging trends in this area. London-based CTN Communications conducted the survey in association with IR magazine.
This year, Vodafone receives a total score of 60 percent, which is up 3 percentage points from 2005. Vodafone’s webcasts stand out because of the company’s use of technology and innovation to make the event more informative and appealing.
In particular, Vodafone uses high quality videos, editing and sound to deliver an informative and accessible webcast. ‘They are embracing the spirit of transparency and communications online,’ says Kai Duggal, who oversaw the survey and is business development manager at CTN. ‘As well as providing all the core information to analysts and investors online, they are making it interesting.’
As Duggal points out, analysts that don’t participate in the live results presentation rely on webcasts as their source of company information. This is why it’s essential for companies to provide this audience with a thorough yet easy-to-follow webcast. ‘Vodafone is presenting quite a complete picture and paying attention to all the quality criteria, and it is still willing to experiment with any new channels that are developing,’ Duggal says.
More and better
What’s interesting is that the FTSE 100 companies that scored the highest in terms of quality webcasts this year also tend to be doing more webcasts outside the regular investor calendar. ‘Top scorers are increasing the number of webcasts outside the annual and quarterly results presentation and trying to grab anything that is worth communicating,’ says Duggal. Common events throughout the quarter include investor seminar webcasts, interviews with CEOs and other business heads, and product launch announcements.
These UK companies are also putting greater emphasis on events outside of the traditional results webcast. ‘Cable & Wireless, for instance, is webcasting longer presentations and using streaming flash technology to reach wider audiences,’ notes Duggal. The communications company is publicizing these presentations more and, as a result, getting a higher number of investors and employees to view them.
Another notable trend is the increase in video presentations. Of the 82 FTSE 100 companies webcasting their financial results, 45 provide the presentation on video. ‘With video, companies are being more transparent not just about their messages but also about who they are,’ says Duggal.
By packaging additional interviews and news in video format, investors and analysts can choose to view key messages instead of sitting through an entire results presentation. HBOS and PartyGaming are examples of FTSE 100 companies including additional video presentations alongside their results and AGM webcasts.
Duggal says this increase in video use also signals an overall trend whereby companies are moving beyond the nuts and bolts of webcasting to seeing the brand value of this communications tool. In other words, now that IR is comfortable with the technology and it’s widely accepted as a good tool to meet disclosure standards, companies are beginning to view webcasting as part of reputation management. According to the survey, the number of FTSE 100 companies including management interviews with results announcements went up from 21 in 2005 to 27 this year.
Three tiers
In analyzing the webcasts of FTSE 100 companies, CTN identifies three levels of webcasting among the UK’s largest players. ‘First you have companies like Vodafone that are embracing the technology as an accepted communications channel and are taking every opportunity to do things according to best practice and regulatory requirements but also make it engaging,’ says Duggal.
Other companies that fit into this category include Rolls- Royce, Royal & SunAlliance, Tesco, BAA, Cable & Wireless and Friends Provident. Notably, the survey shows Rolls-Royce has scored 50 percent higher over last year in terms of the quality of its webcasts in 2006.
The second category CTN isolates is for companies doing basic webcasts without embracing new innovations that make the tool more appealing to audiences. It places BHP Billiton in this group. Thirdly, there are those who aren’t webcasting at all or are doing a relatively poor job. BOC Group and Morrisons don’t use webcasting, and Hilton Group (now Ladbrokes), United Utilities and British Airways are among the companies CTN highlights as having the worst webcasts.
The reasons behind Hilton Group’s low-quality webcasts include multiple pop-ups that result in poor access if pop-up blockers are activated and a metallic, tinny sound quality, according to the survey. The company received a score of 20 percent this year.
A surprising 10 percent of FTSE 100 companies still choose not to use webcasting. But the survey suggests that with more companies fully embracing the medium outside regular results presentations, non-converts risk falling behind in their investor communications. Those IROs on a mission to update or begin webcasting should consider logging on to the webcasts of FTSE 100 companies that rate high in this year’s survey. After all, why not take advantage of the overt nature of webcasting best practice?
