Newport is a technology solutions driven company organized to focus on serving five of the fastest-emerging businesses in the technology space – RFID (Radio-Frequency Identification), WiMax, eLearning, and LED Digital Signage and LED Lighting solutions.

Newport has embraced several social channels including Twitter, YouTube, Posterous and FlickR to broaden the company’s audience.  They also have a Facebook account which we highlighted in our recent whitepaper for their exceptional use of the channel.  For example, the information is current and up-to-date with a good balance of material including recent press releases, links to shareholder conference calls and videos that all help to provide a better context about their business.

So based on Newport’s inclusion in our whitepaper and the “formal launch” of their Social Media program, I contacted Isaac Cruz, the company’s Digital Strategy Manager, to gather some more background information about how this all came to be.

1. How long has Newport been using social media? And what tool did you begin using first and why?
The company launched its social media program in October 2009.  Initially, we saw the power of Google and the importance of SEO, so we created profiles which were verified by Google. We then signed up for Twitter, Facebook, and YouTube accounts.

2. What was the original driving force behind the company’s decision to use social media?
In the early stages of the company’s life, our focus was on Research and Development.  As our business progressed and R&D concluded, there was a natural gravitation towards ways to promote the company.  The Board of Directors saw the value of having a presence on the social networks and wanted to leverage those channels to bring the NDT brand to investors, and potential industry partners and  customers.

3. Were you originally hired on as the Digital Strategy Manager?
At a start up, employees have to wear many hats. Originally, I was hired on to manage the office i.e.  assist executives, do payroll and accounts payables for the corporate office as well as our two branch offices.  As our company was progressing, I was asked to be involved with developing the social media program, which was initiated by an external IR firm. Based on my background and passion, this area of marketing and sales is where I really felt that I could use my talents to benefit the company. Eventually, we developed a small, internal team to take over the social media efforts.

4. Were you able to draw on your own experience with social media?
Back in 2003 or 2004, my college football coaches used Facebook to announce practice and workout schedules. After the coaches would dismiss us from practice, they would yell, “Check your Facebooks!” so we all would know what the next meeting would entail.   Twitter was completely new to me. Over time, we developed an understanding of hashtags, searching and how to write effective tweets in 140 characters.  We also wanted to develop an understanding of url shortening services like bit.ly and tiny.url and how to track the clicks on these links.

We started out with a corporate Twitter account and one main Facebook account. Each Digital Strategist had their own Twitter and Facebook accounts.   As we became more familiar with friends on the company’s Facebook account and what they were interested in, we decided to break out the various segments of our business. In order to be Facebook SEO, we developed fanpages specific to technologies we specialize in, such as RFID and digital signage. Whether it is on Facebook, or Google, we want to provide quality content and be easily found by those interested in the industries we are involved with.

5. Are there any channels that are strictly dedicated to investor relations?
The original strategy was to help increase awareness of our overall business.  We wanted to broaden our message and increase awareness about our company to all key audiences which includes potential partners, investors and customers.  As stated in our release by our CEO, Don Danks “Leveraging digital media and implementing this strategic communication program provides shareholders and clients access to NPDT’s most recent developments, technology solutions, and a roadmap for revenue growth.  Digital and Social media are becoming powerful tools for branding and supporting sales efforts.  We intend to make a consistent and serious commitment to utilizing the power of the medium, benefiting our shareholders.”

Our corporate Facebook page is a great forum to connect with a Digital Strategist who is one degree away from the decision makers of the company. We are committed to providing our investors with whatever information we can release about the business.

6. Is there any interaction on any of the social networks with retail or institutional shareholders?
We have shareholder inquiries mainly on Facebook.  We also have a few who DM me on Twitter. They normally always follow up with a phone call, as it is hard to address questions in 140 characters.

7. What prompted you to formally press release your digital strategy and social media program now?
There are several reasons why we issued a press release regarding our digital strategy and social media program now:

The company has really ramped up over the course of the year. We have transitioned from a R&D company to one with tangible products and are now in full sales mode.  As we have press released our progress, we now have sufficient content to share over social channels by providing links from our website which has increased visitors.

We also wanted to make sure we understood our company’s technological capabilities, our audience and the channels we are using first. In the beginning we did a lot of listening in the social communities and wanted to balance the company voice to ensure we were conveying the right messages.

Further, since launching the program in October of last year, we have put together a Digital Strategy Team. Each team member specializes in areas of social media that best suits their backgrounds and skills. We are solely concerned with ROI which we dub “Return on Interaction” with increased awareness of the company. You never know what relationships could be cultivated in the social business networks.

Lastly, we have a unique business that is not yet two years old. For a technology company, we are progressing very fast.  As such, I posted the following YouTube video that explains the functions of the strategtically located offices around the globe: 

Of note, we do all of our videos in-house like the one above. It takes relatively little time and is very cost-effective!

8. What other channels have you adopted over the course of the year?
We recently added a Posterous account where we post press releases and provide news about the business and background information on our products:

We don’t have a lot of comments on there yet, but we have had 6,913 views since adding the account in May of this year.

9. Any advice for other public companies of the value of using social media?
I can’t speak for all public companies because each company is in a specific industry and has their own specific vision and goals, but I do know this. Followers of social networks really appreciate the personal connection they have with a public company when a representative personally addresses a question, or concern they have. We feel that it is important to accurately, and promptly respond to all inquiries that pertain to the business and employees of NDT. We are actively asking for NDT followers to voice their questions and ideas about the business, or technology on our networks so we provide them with what they want to see. We want our audience to know that we are working not only for NDT, but also for our shareholders.

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Instead we are seeing quite a few companies who have one company blog where marketing, product or research staff comment on new products and provide their viewpoint on industry developments and some IR-related material, such as a significant milestone or event that has happened in the company. Specifically, companies are providing insight and commentary on peer/sector related news such as scientific publications that impact or pertain to the company’s work, a discussion of project developments (oftentimes with an accompanying presentation or graphics to help tell the story), and material company news such as a merger or financing.

We also have a few examples of technology companies that have several blogs, with each dedicated to a specific department.  For example a Marketing blog that is geared towards customers and partners and a R&D blog that is populated by engineers and “techies” who build and test products.

Technology companies also seem to have a higher number of CEO dedicated blogs, but we are seeing a few consumer goods and natural resource companies who also have a blog where their CEO comments on company/industry news.

Here are a few examples (all of the screenshots below link to the blog being discussed):

Accelyrs Software

Accelyrs’ blog is geared towards customers with contributions by product managers, developers and research staff. However, in spite of being mainly used to discuss product and industry information, the company did post the details of their recent merger with Symyx Technologies.

The post was written by the “Accelrys Team” which is made up of the contributors I previously outlined and consisted of a brief overview of the merger (which was not simply verbatim from the press release), although they did provide a link to the full press release that explains more about the merger.

The company obviously felt the merger was important enough as they highlighted the event on the blog.  I’d also like to point out that the company created a new area in their Accelrys Online Community called The Headquarters , with a link to a Customer FAQ sheet to answer specific questions about the merger as shown below:

Having a dedicated area like “The Headquarters” related to a specific company event like a merger is a proactive way to engage and gather feedback and concerns that customers, partners and employees of Accelrys and Symx may have.  Hosting their comments in an open forum also helps everyone to be a part of the conversation to share and gain knowledge.

Axion International

Axion designs, develops and manufactures eco-friendly structural building materials.  As a result they provide links to industry relevant publications such as “GreenTechMedia” – an online magazine that keeps tabs on “Green” companies such as Axion.  Additionally, their co-founder and CEO Marc Green also has quite a few posts whereby he gives insight into articles he deems interesting and of course relevant to Axiom’s core business.

Of interest, in January of this year, they extended their blog onto Seeking Alpha:

Being on Seeking Alpha is a good tactic to drive people to their blog as it helps increase awareness about the company and reaches more audiences.

China Wind Power

In January 2010, China Wind Power launched their IR Blog.  For a small–cap Canadian company, China Wind does a great job of keeping their stakeholders apprised of their business strategy and company developments.

For example, the image below provides an overview of one of their development projects:

Which as we have said many times, companies should maximize their opportunities to provide context about the company whenever they can – as providing information around all areas of the business helps investors to gather comprehensive, credible information to piece together a complete picture of the company.

Emulex

Emulex has four blogs that cover off all aspects of their business including marketing, R&D and the technology industry in general.  For our purposes, I am going to highlight the last one – their “CEO Blog” which is authored by Jim McCluney, the company’s president and ceo.  McCluney uses the blog to convey his expertise of the company’s business through detailed commentary on company news:

Having the CEO give his two cents on company developments such as a partnership or merger is advantageous for both the company and shareholders.  The CEO is able to provide more color on why an event is beneficial to the company and shareholders are gaining valuable insight directly from the CEO.

Rackspace

Rackspace has a corporate blog that covers a diverse range of topics including corporate strategy, company news and industry events.  They also do a great job of incorporating investor centric information.  For example, a few recent posts pertained to an overview of a strategic partnership, with another covering an analyst day at the NYSE.

They have also posted a video whereby Patrick Walravens, on-demand and enterprise software analyst at JMP Securities (who covers the company) interviewed Lew Moorman, President, Cloud and Chief Strategy Officer (n.b. Patrick still covers the company).

In my experience, I haven’t seen a lot of companies with video footage of an analyst who is interviewing a key member of management.  In my opinion, I think this is a good idea as it gives investors (particularly retail) exposure (albeit it virtual) to the sell-side which is rare.

As mentioned, technology companies are leading the way in their use of IR blogs – particularly through a CEO dedicated blog. However, I am going to end the post by providing a snapshot of Whole Foods who also have a CEO Blog, authored by John Mackey.

The archives for the CEO blog date back to September 2005 and has covered a lot of investor relevant issues such as social responsibility and compensation. I particularly liked the way that he addressed some management changes within the company that has him sharing the title of Co-CEO:

John’s posts are written in a very conversational way and as he posts so often, he seems dedicated to keeping shareholders informed and up-to-date on the company’s strategy and direction.

Not surprisingly, few companies are using blogs strictly dedicated for IR.  Instead, of the examples we have provided here, the companies have chosen to incorporate certain IR-related events such as a merger or partnership amongst other posts from the Marketing or R&D departments.

Technology companies are leading the way, but we are seeing a few consumer goods and natural resource companies who also incorporate IR-related material into their blog.  We’ll provide more commentary and insight into how companies are using blogs as we continue to compile our research findings .

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Robert said that Dell uses social media primarily to reach out connect with people who are interested in their company and want to access their information in different ways. He said that it was important to socialize SM internally with legal, finance and other executive positions, who may be concerned about risk, in order to help them understand the importance of being involved and the fact that you just can’t vet everything through the same DC&Ps. “The IRO is in a perfect position to handle social media because they understand the risks, they understand the story. And it’s not like they’re monitoring every phone call I make or every conversation I have with an analyst.”

One has to remember that when it comes to blogging there should be no material statements, no material events and no material omissions.

Laura admitted that at recently as a year ago she was saying, “Social media is not for me” but now she avidly uses it to reach both existing and new investor audiences. Laura said that it’s very important to get your internal people on side, which may be more difficult  with an older established company – you may have to do more work to bring them along but a few quick wins should help.

On this note Laura talked about the contract between Dominos pizza and the employee YouTube debacle, which was quickly addressed and quieted through social media and the Wendy’s ‘severed finger in the chili’ where the issue was addressed through more traditional channels and continued to haunt their brand for many months. (That story alone should be a wake-up call to most senior executives.)

Serena gave specific advice throughout the discussion. She said that it’s important to monitor what’s being said about your company online through sites like www.search.twitter.com , www.socialmention.com , or through RSS feeds. You can even index whether mentions are positive or negative. Serena also felt that issuers should have social media policies that include who represents the company on Twitter, Facebook and other SM. Serena also mentioned a number of other sites as information resources on social media and IR best practices including IR Café and Q4Blog.

Both Laura and Serena said that getting involved in SM doesn’t have to take up a lot of time for a busy IRO and instead, suggested finding someone with the company who is active in Twitter and excited to represent the company online.

Dick said that coordinating SM efforts between IR and PR was very important. He also said that investors are more likely to look for information on your corporate website than any other source and that it should be considered your primary source of information for investors. He offered a checklist as a handout, which he also provides on his site. He then said that a checklist is just the starting point, that a website should not be a filing cabinet and that issuers should look to provide more context for their investment proposition. (Q4 covered this topic previously in an IR website best practice presentation.)

Laura described a scenario which often happens and how social media provides a powerful tool to address misinformation. In the truncating of headlines by the media, often a message is dramatically altered which could significantly alter your stock. A company could issue a press release saying something like, “XYZ reports that sales are soft in Q1 but are expected to be strong in Q4”. The media shortens this headline to read, “XYZ reports that Sales are Soft”. A buzz begins and you can see your stock spiraling down – social media gives you a powerful voice to address these issues and correct the information. And if your company is actively involved in SM, people will know where to go to verify the misinformation.

She also suggested having a section on your site called “Hot Topics” where things like this can be flagged for investors to access further information.

Following this one of the delegates asked how she could keep up with addressing everything negative that was said about her company online. Serena responded by saying that this wasn’t necessary, and that sometimes these negative comments are coming from people who are not widely followed anyway. She suggested to measure how much traffic some of these negative bloggers get (before determining where it was necessary to respond) through sites like www.compete.com , www.quantcast.com , and www.alexa.com

Both Robert and Laura said that V-logs (video logs) were very good ways to address issues and to put investors in touch with more people inside the company. (In fact Dominos CEO addressed their issue through a video.) Robert said that they use V-logs to address 5-6 questions on the quarter and this has been a very effective strategy for them. 

How to get started – read Reg. FD with a ‘blog mindset’, and find a mentor. Put a calendar together to ensure regular blog posts. You’ll find that you won’t have to spend a lot of time thinking up things to blog about as issues will come up that provide blog topics.

There were a lot of good points made in the session, some of which I may not have captured in this post. I welcome comments from any of the participants or panel members to provide additional information.

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