Webcasts and teleconferences are relatively simple to set up, and can be done on very short notice, although notice there must be to avoid problems with Rules of Disclosure. They are, in effect, simply conference calls. Web sites give instant access to new and constantly updated information. E-mail is as ubiquitous as the telephone, and can be made secure. The internet—and, therefore, the webcast or e-mail—reach around the world at no additional cost. The teleconference does not, except at great expense.

Video conferences, unlike teleconferencing and the internet, require fairly extensive preparation, and are best done by professionals. There is a question of equipment on both ends, as well as the graphics one would normally use in any visual medium. Expertise is essential here, and fortunately, there are a growing number of companies that do it. Competition in this field is breeding more realistic costs.

As with any mass communication activity, traditional or electronic, preparation must be meticulous. The planning should include at least the following steps as a guide, but not necessarily as fixed rules. Circumstances —and good imagination and skill—alter rules appropriately. The basics are:

• Determine the reason for the event, and its objective. The rules of the press conference apply. To hold an electronic event simply because it’s possible to do it, or because it affords a broader audience, is scant reason. There should be a singular message, or at least a piece of news of magnitude, to impart; a realistic basis for urgency; a sound foundation for bringing a large group of investors together. The classic question to be addressed at this point is, again, What do you want them to know, think or feel after the conference is over?

• Determine the timing. Is each event discrete, and planned separately each time for a different audience? Is it a periodic event—quarterly, semi-annually or annually—to the same audience?

• Determine the target audience. Even though you can reach large groups at one time, you will still have a different message for analysts than for brokers; for analysts covering specific industries and for institutional money managers.

• Plan the invitation process. How will you invite people to participate? What is the timing of the invitations? What is the best response mechanism? E-mail? Fax? Mail? Phone?

• Detail and script the event. Who talks and says what? Who handles the questions from the audience? What material gets sent out beforehand, and what material afterward? What is the script to say and who is to write it? Do any of the speakers need training?

• Run the event. But rehearse, first. You’re paying for the time, and the participants are paying with their time. Every moment should count.

• Follow up. How? With what? How often?

DETERMINE THE OBJECTIVE

While it might be tempting to use a teleconference or a video conference to simply replicate the classic analyst meeting, it might be more useful to use the event as a means to impart something specific and something more appropriate to the medium.

Obviously, differing factors dictate different approaches. A company that’s new to a great many analysts and potential investors might want to hold and surpass the classic meeting, but the ultimate judgment lies in what could reasonably be expected as a result. If introducing an undervalued company to a great many potential investors is the objective, then the medium is used differently than it would be to tell a large group of analysts who have been following the company about the meaning of new products or new contracts.

One key to the success of an electronic conference is to recognize that, more than in the classic meeting, the level of focus and attention of participants can be exceptionally high. But that also means that the opportunity is best seized by focusing on a single message—a single position—for each conference. The answer to the question of what you want participants to know, think and feel afterward is a good starting point. While it’s tempting to try to make more than a single point on your nickel, it just doesn’t seem to work. One major point, reiterated and supported with facts, does work. This assumes that you’ve done your homework in vetting the participants, and in sending ahead the kinds of facts and figures that participants can read and refer to at leisure, and that don’t need to be reiterated in detail by management as part of the presentation. The facts and figures, remember, support the message. They should not be the message itself—unless, of course, the facts and figures are the point of the session.

DETERMINE THE TIMING

If you’re using the conference to supplement disclosure, then the timing is dictated by the Rules of Disclosure. Webcasts and teleconferences are useful on short notice, when special events require quick follow-up to disclosure of the kind of urgent news that you are also putting in a news release, like a major acquisition, an unfairly negative news story, a fire at a major plant, and so forth. The quarterly webcast is becoming the standard for informing key investors and analysts in small groups, as well as larger groups, if circumstances warrant it. A mid-quarter teleconference is an excellent vehicle for new or potential investors who might not fully understand the company. The time of day for a conference is dictated by the nature of the conference and the audience, remembering, again, that a webcast requires infinitely more preparation than does a teleconference, which can be set up on virtually a moment’s notice. Obviously, as in all other communications to the investing public, it seems rational to release breaking news early—even before market opening (allowing for differing time zones). Negative news is sometimes held until after the market has closed, which may seem to be a clever idea, but which can adversely affect credibility. A University of Chicago analysis suggests that releasing results and having the call after the market closes minimizes the unusual first few minutes of overreaction that sometimes occurs. In view of the increasing amount of after hours trading being done, these classic rules may now be irrelevant, but that, too, is a judgment call.

The conference call at the after-market close has two other advantages —it’s backup if the disclosure wires don’t print your release, and there are more investors available than when the market is open.

DETERMINE THE TARGET AUDIENCE

Because of the relative simplicity and lower cost in setting up a teleconference, there’s more latitude in choosing a target audience, particularly in several cities at once. It can be new or current investors, analysts or brokers. The choice of the group is no different than it is for traditional meetings. For teleconferencing, the minimum useful group is probably about five to eight, although as many as twenty is manageable. More than 25–30 can be unwieldy, especially if questions will be accepted. It may even be feasible to hold several calls, back to back, with different groups with different investment concerns.

For the teleconference, the number is limited only by budget and technical considerations. In view of the original cost of equipment, larger groups are feasible, and for larger companies with larger followings, as many as a hundred people in one video conference is not unusual.

THE INVITATION

A simple e-mail, a one page letter, or a fax on corporate letterhead from the CEO or investor relations professional to investors briefly and directly states the purpose of the call—announcing quarterly results, current update, comment on a known acquisition, comment on a known management change, further explanation of an announced strategic change of direction, and so forth. The invitation shouldn’t anticipate the key news, which would take the impact out of the conference, and might not be considered adequate legal disclosure. The notice tells the reader there will be a webcast, internet conversation, telephone or video conference with selected investment professionals or key investors and management, and that there will be the opportunity to ask questions. It should explain who else will be on the call, both management and participants, so that all invitees have a good sense of the company they’ll be part of, and can prepare accordingly. The timing of the letter is a function of both the event and the content. For a conference on news that is closely linked to timely disclosure, the notice should be sent out urgently—perhaps even by overnight courier or fax. For larger events, a week or two beforehand might be appropriate. For internet conferences, e-mail itself becomes the medium for invitation. As with traditional conferences, some electronic events may require e-mail or phone follow up to invitees.

THE SCRIPT

Preparation—and rehearsal—are necessary for a succinct, focused, and successful conference. Use professional speech trainers, if necessary. Hone the message to specifically address the point of the conference. Anticipate questions, and prepare answers beforehand. Surprises in front of a large group, on a webcast or telephone conference call, can be embarrassing. Careful preparation is also necessary because interest must be sustained —perhaps even more so than in a traditional presentation. A number of people in different locations are brought together not in a common room, where there is little choice but to focus on the speaker, but at their own desks or computers, where they can be easily distracted. Dull, uninformative conference calls are a profound waste of money. Be interesting, be informative, or you’re wasting your money and eroding your credibility. The techniques and structure of electronic presentations are essentially the same as for traditional meetings. The difference is in the focus of the message, and in the time constraints.

THE EVENT

The more people involved as participants, the more precise the timing must be. The conference should start on time, and end on time. Even if key people on your staff are not participating, they should be present to supply information and help with questions.