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Making the Case for Visual Micro-Cap Investor Relations

Investor Relations has long been the domain of text, numbers, charts and other rudimentary graphics. For investors of larger companies, this means of analyzing a company may never change.

However, for micro-cap investors, the audience is completely different. Most of these investors are story driven. They are looking for a one-hit-wonder that will put them on Easy Street.

Investors of small companies tend to be younger. In our 5-year research project, a stunning 49% of the investors for micro-cap companies were 18-25 years old. What drives these investors is completely different and actually, at the far opposite spectrum than larger company investors.

What micro-cap investors are looking for is quite simply, a Compelling Reason to Invest. This may seem basic and obvious. However, in my years of looking at thousands of small, publicly traded company websites, there are very few that present any reason to invest, let alone a COMPELLING reason to invest.

The Solution?

You have worked your butt off to build a Company, its products or services and it has been a long, hard job. So now, how do you get investors to buy stock in your Company?

There are companies that trade good volume every day thereby giving them the opportunity to raise money and grow their business.

Most of the companies that have liquidity have:

  1. ·         They have good to great websites
  2. ·         They produce good, quality content (content marketing is the “secret”)
  3. ·         They are great at telling their story and use plenty of visuals
  4. ·         They work their social media platforms daily
  5. ·         They inform their investors and the investment community frequently
  6. ·         They include graphics, photos and video in their normal day to day postings

All of the above gives investors plenty to look at and obviously, many of those investors are finding a compelling reason to invest in these few companies.

The bulleted list above seems so simple but there are techniques to each aspect that must be executed correctly, otherwise the results will be minimal. Doing things the right way always involves more work, persistence and patience as well as a knowledge of what you are doing.

I have seen many micro-cap companies endeavor to upgrade their websites, start posting away on social media, blasting out news releases and so on. When the stock does not start “rocking” within a few days to a couple of weeks, they lose interest and give up.

Let’s face it; the days of the micro-cap stock promotion and aggressive IR tactics are a thing of the past. This methodology does not work anymore; especially with the young and now savvy micro-cap investors. Micro-cap investors used to be composed of a lot of “sheep”. The sheep have all been culled. A large segment of micro-cap promotion is conducted for the liquidation of debt conversions; these investors have become wise to this activity.

So how can these investors be reached?

Aside from the points covered before, these investors are far more visually oriented. During my research, it became abundantly clear that micro-cap investors have an aversion to text. They quickly get bored with reading.

They stated that photos, graphics and video was what they wanted to see. They want a visual guide to the path to profits painted for them on the website.

This information made perfect sense. The human brain learns faster, retains more information and is much more engaged with audio-visual stimulation than text.

·         Nearly fifty percent of the human brain’s resources are devoted to visual processing [1].

·         Seventy percent of all the sensory receptors in the entire human body are in the eyes [2]

·         In about a TENTH of a second, the eye/brain combination can process the general meaning of an image [3].

·         It is true that a picture is worth a thousand words and retention of visual information is much better than text. [4]

The Time Factor

As mentioned in a previous article here, you must get the attention of the investor quickly. Micro-cap investors in particular, have short attention spans. If they land on a company site that is out of date, text heavy and contains few graphics, they will see no compelling reason to invest right away and they will leave and never come back.

What to Show Micro-cap Investors

With regard to your website, a large graphic at or near the top of the page is a good starting point. If you have several graphics, you can rotate them through using a “slider” application. High quality graphics or photos that are colorful and convey your company’s business and mission are best to use. So much of what works best depends on your company’s business and industry. There is no standard solution for this.

For your investor page, an exciting video which is 3-5 minutes long that describes your company, its business and mission is the best thing you can do for your company with regard to “visuals”. Have the video hosted at YouTube or Vimeo and embed it on your site via code. This way, you have a huge platform with millions of users to host the video on but NEVER send visitors to the YouTube site to watch the video. Embed on your site and link to it there.

Too often, I see companies include links in news releases to content on video or other content related sites. What good will it do to send prospective investors somewhere else to view your content? Always send them to your website!

A nice company presentation, which is hosted at SlideShare, can be placed on the page, which is somewhat interactive. The code can be embedded on your website and enable the visitor to have some options on how to view it.

Add as many photos as you can provide to your website. Include captions with them.

What this Means to Micro-cap Companies

Major changes are occurring across the Internet and on Social Media in response to the strong trend toward visual marketing and storytelling. The micro-cap marketplace can get a big boost by responding to these trends by incorporating visual marketing as the primary way to engage with investors. It is not going to go back to the way it was.

Sources:

[1, 2] 4 Merieb, E. N. & Hoehn, K. (2007). Human Anatomy & Physiology 7th Edition, Pearson International Edition.

[3] Semetko, H. & Scammell, M. (2012). The SAGE Handbook of Political Communication, SAGE Publications.

[4] Lester, P. M. (2006). Syntactic Theory of Visual Communication.

The sources above came from the infographic by NeoMam Studios

This is not sourced directly but see this for more info: HubSpot’s 37 Visual Content Marketing Statistics You Should Know in 2016