Thursday, January 27, 2011

Should Media Relations be combined with Investor Relations?


Investment relations (IR) is the amalgamation of communications, building relationships and guiding management in taking the final decision. Essentially it is a strategic responsibility to enable effective communication between the company, financial community and the public which finally contributes to company’s securities achieving fair valuation. Usually an IR department or person reports to the Chief Financial Officer (CFO) or the treasurer. In some organizations, IR is managed by public relations or corporate communications department and is called “financial public relations” or “financial communications”.

The investor relations deal with handling inquiries from shareholders, investors, or anyone interested in company’s stock or financial statements. The IR also has a vital role in crises management such as changes in management, industrial damage etc. Investor relations has the responsibility of managing perceptions of the investors and deals with any information about the company that may affect the stock price or earnings of the company. It is important for the company to attract the investors because they are the only source of capital for the company and increased investor interest leads to increase in the stock price of the company.

An IR department is the only department which has interaction with the stock market. Earnings releases, earnings forecasts, annual and quarterly reports and most press releases, are all part of investor relations and the responsibility of the investor relations officer or department. Previously IR used to just focus on release of financial information but now the trend has changed and almost everything issued by the company is the responsibility of the IR department. This change is partly due to increased regulatory requirement and also because it’s been seen that whatever the company does or would eventually do, will affect the profits or the stock price of the company.

On the other hand, Media relations (MR) refers to working with media in order to disseminate information to the public about an organization’s mission, policies, practices etc. in a credible manner. Working with media on behalf of an organization helps the company to create awareness amongst chosen set of audiences, both small and large set of audiences. Media also encourages two way communications.


The relationship between an organization and news media is very crucial as the story pitched to the media is under their control totally and the journalists will publish the stories which interest their audiences. Media relations services include: Financial and business media, trade media programs, market commentary, online media programs, regional media programs etc.

Looking at these two separate functions (IR and MR) from the purview of them being the subsets of the concept of Public Relations (PR), while there are spaces of commonalities between the two, there are also exist differences.

In terms of the common touch points, both investor and media relations deal with the influencer community that includes the likes of financial/equity analysts, industry analysts, journalists, bloggers etc. Further, both investor and media relations use the same flavour of information to showcase to the influencer community, there are key differences in how this information is served to the two different sets of audience. While the IR department predominantly uses financial data points and strategy to engage with equity analysts and other similar end-users, the Media Relations uses company and product strategy to influence journalists, bloggers, etc.

Further, a revolution is taking place in how organizations are communicating with their audience using social media platforms. While Media Relations has for long pioneered the use of social media to communicate with its respective set of influencer community, the investor relations officers are also actively making use of these tools to enable a two-way communication between the company, the financial community, and other constituents.

In conclusion, while in theory its near-ideal to combine the two PR functions discussed above, there are differences between them that deem organizations to treat them as two separate entities. Maintaining them as separate groups, PR heads can look at using innovative ways of sharing resources within these teams – while this will help curb costs, it’ll also save the team the effort and time taken to train two separate resources on nearly the same aspects of the business.

Many organizations today have successfully adopted this model and are investing in a common pool of resources that function as the backbone to the different PR functions. Clearly, impetus is on maximizing utilization of resources with standardized skills coupled with specialists leading each of the separate units within the PR department.

Decisive Communication Moment


Decisive Communication Moment

“I’m a PC” Campaign – Microsoft’s response to Apple’s “Get a Mac” Campaign

A $300 million advertising campaign was created for Microsoft by ad agency Crispin Porter + Bogusky (CPB) named “I’m a PC”. This campaign was designed to challenge the Apple’s “Get a Mac” campaign which showed the PC as boring, clunky and stereotype when compared to the cool and intuitive Mac. This campaign by Microsoft had a huge impact on people and eventually there was a tremendous sales growth as compared to the Apple’s sales.

Stage 1: Apple’s “Get a Mac” campaign

The “Get a Mac” campaign was created for Apple by the company’s advertising agency TBWA\Media Arts Lab. The campaign became an instant hit because all the series of the ads had a white background with two men, one of which were dressed in casual clothes and introduced himself as Mac (“hello I’m a Mac”) while the other man in formal suit and tie introduces himself as Windows (“And I’m a PC”). The two of them compare the capabilities and attributes of Mac and PC. The PC is portrayed as a formal, polite, stuff, overly concerned with work and frustrated with the more laid back Mac’s abilities.

Apple’s ‘Get a Mac’ campaign is over after one of the most long-lived advertising runs of all time. The campaign which began in the year 2006 was replaced by the Apple’s website with a new “why you’ll love a Mac” campaign, which asks consumers, “Why get a new PC and just upgrade your computer, when you can get a Mac and upgrade your entire computer experience?”

The “Get a Mac” campaign obviously forced Microsoft to challenge the campaign and there it was with a $300 million campaign!

Stage 2: Microsoft’s “I’m a PC” campaign

The “I’m a PC” campaign first began in September 2008. As discussed above, it was designed to challenge the Apple’s campaign. The campaign was created by CPB advertising agency and featured that normal PC users are found everywhere. The 60-second ad features more than 25 different people as PCs compared with Apple's one in all its TV spots. The intent was to demonstrate how PC users are ordinary people. Microsoft proved that people buy products that they see advertised and it increases awareness and they build an emotional connect with the brand or the product.

As soon as the Microsoft “I’m a PC” ad started airing, the Apple’s ad “Get a Mac” just disappeared. Microsoft’s sales were touching the sky as Windows PC was much cheaper than the Mac and also the “Windows. Life without walls” marketing made the people go crazy about the PC. Even netbook sales went up, giving additional uplift to Windows laptop sales.

Unfortunately this campaign faced some serious criticism. It was found that Microsoft's "I'm a PC" advertising campaign was created on a Mac and the celebrity speaker brought in by the software giant were all professed Apple fans. Also the four still images of the campaign posted at Microsoft's press site contained digital fingerprints from Adobe Photoshop being run on Apple computers.

To the above criticism, Microsoft issued a statement saying that almost all campaign workflow, agencies and production houses use a wide variety of software and hardware to create, edit and distribute content, including both Macs and PCs.