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Have you been looking to give your investor days a refresh? After all, there’s no better opportunity to shine in front of top management than to plan a perfect event that involves plenty of facetime with the CEO and other key management.
Also known as an “analyst day,” an investor day is a public meeting, where presentations are made by the CEO and other VIPs of a company in front of a live audience, for the purpose of updating the public on the health and direction of the company. Investors and analyst are present to ask questions and a global audience listens (through simultaneous live streaming). Companies use investor days to weave a compelling narrative about corporate health, culture, and vision, but with a live Q&A—also a standard part of investor day—it can be a challenging performance for your top brass.
As anyone who has participated in an investor day knows, these are high-stakes events that are not always full of good news. Which is why events in this environment merit the best execution.
Step #1: What Kind of a “Day” Are You Having?
Investors are the lifeblood of all public companies and many private ones. For the most part, investors share the vision of the company and look forward to basking in a success story at the end of the rainbow.
Still, there are times when, like old friends, corporations and their investors need to either to affirm their relationship or start a new one.
It may surprise you to learn that not every corporation hosts an investor day, nor is every company planning to have one in the near future. Unlike annual meetings and board elections, investor days are not required. They are more like earnings calls that, while not mandatory, have become common practice for certain publicly traded companies.
If companies that hold investor days were to be profiled, the major characteristics would be an active pursuit of growth through mergers and acquisitions (M&A), and of more investor interest for new products in research and development (R&D).
Investor days are part of the means for making their case. For example, of the 2,190 investor days listed by Bloomberg Events from 2004 to 2011, a survey of the 1,116 hosting firms discovered that 75% of those companies “operate more segments and engage in more R&D and M&A activities than firms that only make conference presentations, consistent with analyst/investor days offering unique disclosure benefits.”
An example of this type of event was one held by General Motors in November 2017. The purpose of GM’s investor day, held at the autonomous vehicle division in Burlingame, California, was to showcase the company’s progress in this forward-looking field. Following the presentations and Q&A, audience members were offered rides in the company’s prototypes.
In the case of Dunkin’ Donuts’ investor day held in February 2018, the company announced that 75% of all new restaurants would have a drive-thru lane, as research had revealed that restaurants with drive-thrus had 40% higher sales volume than non-drive-thru locations.
When Times Are Good, Here’s What an Investor Day Can Look Like...
Management wants to convey:
- Financial surplus, based on:
- Well-received new products
- Good management decisions and strategy
- Management reading the signs correctly
- Good management decisions
When Times Are Bad…
When a company has had a disappointing year or scandal, it may choose to get out ahead of the bad news, or at least hope to spin the narrative to its advantage. Many of these types of investor days center around a “change of direction” message that is often delivered by the outgoing or incoming CEO. And in November 2017, when General Electric held its investor day, new CEO John Flannery sought to prepare investors for a course correction.
The bottom line has always been that investors see red if they don’t see their green. If the company is performing poorly or is the subject of bad publicity or a gossip campaign, then getting through an investor day without a challenge will seem like navigating a minefield.
Here what a reactive investor day can look like:
- Addressing some of the challenges management may be facing:
- Disappointing dividends
- Turnarounds in the market
- Bad management decisions
- Investor revolts and board takeovers
- Selling a bold new strategy as the solution
- Accepting a poison pill (new members on board, downgrading expectations, disappointing results)
While both scenarios require the same amount of tech prep and rehearsal time, bear in mind that the reactive scenario will influence:
- Scheduling: There is less time, as the corporation is attempting to correct or explain a wrong impression and will want to get its case out to the public as soon as possible. To make sure they can get the right venue and vendors, the team might have to make multiple reservations and hold them until the last minute. Set aside money for cancellation fees in case plans need to change at short notice (more on this later in the post).
- Investor and analyst invitations: Limit the live audience to the need-to-haves and choose the venue accordingly.
- Choice of venue: Depending on the challenge the company is facing (profit shortfall, etc.), investors will judge the corporation on the venue ostentation. Consider holding presentations in the headquarters auditorium or other modest settings.
- Presentations: If there is bad news, don’t try to bury it in details. Make sure that the CEO and others presenters receive special coaching for the Q&A section.
- Branding: Nothing over the top!
- Food and beverage, entertainment, and premiums: Again, nothing over the top. Limit premiums to informational items (USB drives,etc.).
Check out the full, 10-step guide on Catalyst, Convene’s meeting, event, and workplace blog.
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