Social Media's Increasing Importance for Stock Research
Public Companies Ignore Your Social Media at Your Own Peril
If you thought I was going to mention the subreddit group Wallstreet Bets’ (r/wallstreetbets) impact on the stock market’s recent activity that is not what this blog is about. It’s about the need for public companies to begin to realize that having a strong plan in place for social media is vitally important to their maintaining their stock market position. The growth in individual investors who can now buy stocks via simplified platforms using even small amounts of money is fueling this need. Even professionals turn to social media in ever increasing numbers. A full 70% of people surveyed said they will check not only a company’s social media platforms for information, but also look at the CEOs of these companies’ social media platforms. For influential CEOs a random tweet, Instagram post, even Facebook comment can send the stock into an upward or downward spiral.
So, the question for many smaller public companies is, “Do you have a Social Media Plan in place?” If the answer is no, here are a few tips to help you get started.
1) Establish who can post to the company’s social media account. Make sure you have a point person who oversees what is going to be posted to your accounts
2) Develop a planned social media posting schedule
3) Posting press releases and SEC filings is not good enough to satisfy investors anymore
4) Post about things in the news that may affect you both positively and negatively.
5) Make sure the CEO is visible on at least one platform. Have at least 1 post per week.
6) Be consistent. If you post 6 times in one week and then nothing for 3 weeks you will lose the attention of prospective and current investors.
7) Get employees involved. Create a template for them to post when something good happens. Make sure you are not posting non-public information and the posts are approved by a person in charge.
8) Create a community platform for employees. Make sure you have a clear set of rules as to what can or cannot be posted. Companies that treat their employees well have better results than companies who do not. Let the public know you care.
These are just starting points. Companies with the best communication skills are rewarded with higher stock prices during good times and more stable prices during bad times. Do not ignore these platforms but use them to your advantage. If you’d like to discuss this in greater detail, please feel free to email me at email@example.com or setup a free consultation.