Conference Calls — Some Handholding Required

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Those of us in investor relations are already gearing up for Q4 earnings, and the longest document many of us will work on is the conference call script.

The earnings conference call represents a valuable opportunity to directly reach out to& analysts and shareholders. Practically everyone who cares about the company’s performance will either listen to the call or catch the replay. There’s a lot of pressure to perform, and the quality of management’s prepared comments sets the tone. So the script must make all your key points — and make them clearly.

This is easier said than done.

Conference calls in my opinion are one of the hardest venues for communication. The reason is they are stubbornly linear. Once something is said, it’s gone and you’re off to the next point. If a listener didn’t fully grasp a particular point, there’s no way to know. There’s also no way for that listener to skim back through the text.

That’s why it’s critical to repeat … repeat … repeat. Now, I don’t mean keep hiting your two or three key talking points again and again until they become a bore. Rather, I mean repeat prior points that set up or create the context for a new idea.

Something like this:

“Earnings came in a bit softer than we anticipated due to the delayed launch of SuperProd.

“However, as we said earlier in the call and in our press release, this launch was delayed in order to integrate new features XXX, YYY and ZZZ, which will make SuperProd far more competitive.

“In fact, we expect to see revenue expand 133% in Q1 vs. a year ago based on advanced orders for SuperProd, far greater than we expected. With that in mind, we expect Q1 EPS in the range of …”

Rather than hope listeners recall our earlier reference to the addition of new features — which caused the launch delay and weaker-than-expected earnings — we make sure of it. We hold listeners’ hands through the call. If they don’t get it, we’ve failed.

There are lots of ways to use this technique in practice and I urge you to give them a shot if you haven’t already. With slides you can use a pointer. With press releases, readers can scan back themselves. But on a call, you can only use verbal references like these to guide your listeners through the presentation.