It comes down to the viability of the brand, customer trust, and a high degree of competition.
Why Is Social Presence Importance For Online Learning
Every time an executive level or personal manager checks his company’s social media presence, it provides a little bit of insight that investors could easily use.
A few days ago I mentioned that Facebook (FB) was being taken to task for the latest effort in an ongoing battle against fake news being fought by both the Federal government and Facebook. The decision by the Federal Trade Commission to issue a fine of $22.5 million to Facebook for misappropriating user data was a media event. On the heels of that, a tech-savvy President Trump took to the #OpFakeNews hashtag on Twitter (TWTR) and continued to single out all forms of corporate social media as the big focus point.
I’m sure there is some underlying difference of opinion going on on social media over the day with the FTC/Facebook action, but there is a systemic trend in place for our own Rolodexes. Don’t even bother to ask about it. CEO’s use Facebook (FB), Google (GOOGL), Twitter (TWTR), LinkedIn (LNKD), etc. for a countless number of things like outreach, branding, and internal communication.
Take a look at some of these clients and what they do with their social platforms:
Mr. Trump isn’t the only one.
The difference in these social media platforms is that many of them are free, whereas most companies pay for advertising through Google. Social media has been a part of my life since 2010 and I know that companies do business quite a bit and learn a lot from social media – some might say there are potentially practical benefits in learning how to be better at what they do.
CEO’s especially have an under-appreciated tool in their toolbox. There are benefits that they can get from leveraging social media and understanding its unique attributes. When we began searching for a stock to get in on here and think about the opportunities, I found the list of Russell 3000 Companies. This daily price target lists the next day’s company performance over a 6-month time period, which illustrates a company’s business path and business rationale.
While social media can be incredibly powerful and effective, it’s also important to know that it is not an unbridled route to gain attention, compensation, or popularity. When the risk vs. reward line is crossed and the risk is clear, the ability to cut through that clutter to engage the public is something that can be beneficial to both the company and its shareholders. With that being said, there is nothing to suggest that there is not a direct correlation between the availability of ads on social media platforms and the potential for increased interest, buy interest, or trading interest.
The top part of the page shows the percent of the Russell 3000 Market Cap and the price gained over a 6-month period.
Below that, you can see how social media makes a huge difference for top stocks in the Russell 3000. The companies along the graph are the five biggest winners over the last 6 months. The performance chart below shows this group, along with the smaller Russell 3000 companies that made the cut to get listed in the database.
Overall, Facebook made quite a splash on this graph. The stocks at the top of the list are far more accessible to the masses, with a diversity in benefits, using the available value, and being able to communicate to the masses, not just as individuals, but also as companies.
Investors might consider owning individual social media stocks or only a couple, or they might even utilize a commission free version that offers a broad cross-section of big name online personalities. While there is not a time limit on these stocks, when you become invested, you should be aware of how companies are using the tool that connects them to the masses as a tool for building credibility and track record. Even for companies that don’t do exactly the same thing every time, social media is still a significant source of information for the consumer that uses the time-tested method of asking an employee via a loud speaker or a smartphone.