Wednesday, February 16, 2011

The Top Five IR Pitching Errors to Analysts

Here's some helpful advice in dealing with analysts from an anonymous colleague:

The Top Five IR Pitching Errors to Analysts

1) Not establishing credibility.

You have to establish that you know the subject matter as well as the CEO or the CFO. The best IR guys make it seem as though they're subject experts. If they don't, the analysts just want to figure out how to get around them.

2) Obfuscation of the issues.

Analysts are a smart lot. The minute you try and obfuscate the truth, you've lost your audience and their trust. They'll question whether everything you've said is untrue. Analysts know your company well, so don't lie!

3) Not delivering the goods.

If you said the company is going to deliver something by a certain date or time, you had better deliver. Don't promise things you can't achieve. You'll be penalized more for overpromising and under delivering than you will for under-promising and over delivering.

4) Not explaining why it matters.

One big mistake IR people make is not explaining why certain strategic things that companies are working on matter. IR staff should be able to articulate key strategic themes, and what the financial impact will be on the profitability of the firm.

5) Being unclear about how you'll outperform.

There's a lot of competition for analyst attention. IR staff has to be obsessive about communicating why your company should be followed, and recommended, by the analyst community over the next firm.