Several years ago when I was covering the dot-com bubble, a German magazine featured me in a story. “The Harbinger of Death,” the writer called me, noting that if I wrote about a company there was a good chance that said company was on its way to the grave. “The Harbinger of Death” is back, but these days I’m an analyst, studying corporate executives who disastrously borrowed money against the stock they own in their company. It’s a public relations nightmare for the execs and their companies, but it’s unsurprisingly a golden opportunity for media outlets covering the story. If your company’s public relations department is in the business of providing the media with research and data, the following should offer some important lessons about how to “own” a breaking story.
These executives are getting hit with margin calls and being forced by their lenders to liquidate large positions. In one month, corporate executives at more than three dozen companies were collectively forced to sell more than $1.5 billion in stock. These shares had been worth over $10 billion a year before.
The spate of executive margin calls has been a boon for my company. We’ve supplied data to and been quoted by the Wall Street Journal, the New York Times, Financial Times, Reuters, Associated Press, Bloomberg News, Barron’s, CNBC, and a number of other media outlets. We secured this media coverage by being first movers and as a result we “own” the story.
It all started late in the day on Friday in October when Chesapeake Energy disclosed that its co-founder, Chairman, and Chief Executive Officer, Aubrey McClendon, was forced to sell more than 90 percent of his holdings. McClendon had spent more than $660 million to acquire shares of Chesapeake Energy, a natural gas provide, over the previous five years, borrowing from banks and using the stock as collateral for the loans. Over a three-day period, he was forced to sell more than 31.5 million shares, or roughly 5 percent of the company, for approximately $570 million. The money went to McClendon’s lenders.
Following the disclosure by Chesapeake Energy, I knew that the issue of executive margin calls would be a big a story. I fired off emails to my research and data teams telling them that I needed their help over the weekend. By Monday morning, we had issued an extensive report to our clients detailing companies that had so-called “margin exposure,” essentially examining who would be the next Chesapeake Energy and Aubrey McClendon.
We let our clients digest the data for a few hours and then began to distribute it to select media contacts. We had our first two hits by the end of the day and more came in the following day. On Wednesday, we issued a press release announcing our research. The floodgates then opened.
The most important thing for us to do, as a research and data provider, was identify that an opportunity existed to help drive coverage of a story that was going to have a long shelf-life. We have competitors who have access to the same research and data as we do and they all have larger workforces, yet we beat them to the story because we were willing to put in the time after-hours. Just as important, our existing media contacts, gently fostered over the past three-plus years, knew exactly where to turn when the story became worthy of headlines.
I’m proud of the work my team has done. We quickly and correctly identified a big story unfolding. We immediately went to work to put together information that would be relevant to our preexisting media contacts. We went the extra mile by putting in hours over the weekend and into the wee hours of the night. And we drove coverage by providing updated information and commentary for a wider range of media sources.
The hard work has paid off for us. Not only have we scored an enormous amount of press, that press has generated a substantial amount of sales leads and actual sales. This is no small feat for an investment research firm during a volatile market when many prospective clients are severely curtailing costs.
For any public relations firm in the business of research and data, the key is being first and being accurate. Your PR firm can become the “go-to” source for the media by providing the most comprehensive information available. In doing so, you’ll silence your public relations competitors and position your company as the leader in the space.
This article, written by Ben Silverman, originally appeared in PR Fuel (http://www.ereleases.com/prfuel), a free weekly newsletter from eReleases (http://www.ereleases.com), the online leader in affordable press release distribution. To subscribe to PR Fuel, visit: http://www.ereleases.com/prfuel/subscribe/.