What Effect Can Social Insights Have on the Annual Report?

The annual report, the document produced each year for shareholders, the market, investors, and the media, are almost entirely focussed on financial audit info. Profits and losses, turnover, capital, wages, pension funds and so on. After all, that’s primarily what investors want to know: how much the company, and their stake, is worth.
However, what are some other key factors at work within a corporation’s financial reflection? What about the sort of reputational or brand strength information wrapped up in social media data?
In recent years, Corporate Social Responsibility (CSR) has taken an increasingly prominent role in company annual reports. Legal and popular pressure on companies to act responsibly, in terms of employment, community, charity, and environment, has brought CSR in to the ‘annual report’ fold. The boards and shareholders of such companies know that their reputation is at stake, and reputation is pretty important when it comes to next year’s results.
With that in mind, reputation and brand strength should obviously be included in the annual report. And they often are. Statements about how Brand X is ‘the leading supplier of…’ or how Company Y is ‘the most recognised brand in the market’ are common in annual reports. But how can we add more detail to these sweeping statements? We need a way to access real customer feedback and opinions, freely given, and we need access to lots of such data, in order to draw significant conclusions.
Social media insight data has a strong case for being the best way to achieve exactly that…

Measuring the Brand:

If we want a measure of ‘brand recognition’, then how about gauging volumes of chatter on social media? Total volume is a blunt instrument, but can be more useful in relative terms: relative to this time last year, relative to main competitors, and so on.
Here’s an example looking at different brands of cider in the UK, plotting their share of voice relative to one another across the last two years. Plenty of patterns and comparisons to be made by any of these brands in their annual reports.
Share of Voice Annual ReportWhat about brand health? Knowing the sentiment towards your brand (whether it is viewed positively or negatively by consumers) is a major, and fairly standard, aspect of social media monitoring. So why not include such measures in the annual report? In fact, why not go further, and attempt to uncover and quantify the actual drivers of sentiment? If social insights around what caused people to like or dislike the company over the last year can be uncovered (and they can!), then they surely deserve to be communicated to stakeholders.
Nectar Opinion Analysis
Here, we see various factors resulting in positive and negative opinions of Nectar Points, the loyalty / reward scheme. This uncovers technical problems, communication strategy ideas, and customer behaviour that could stand the company in good stead for the next financial year.
Thirdly, brand equity is also useful here. With the unsolicited opinions tied up in social media data, we can identify, and measure, associations with the brand and its products. Is the brand seen as innovative? Luxury? Is the product seen as technologically advanced? Easy to use? Expensive?
honda and BRANDS OPINION
For example, the above screenshot shows how Honda and British Airways have quantified various brand associations that matter to them. BA is seen as desirable, among other things, while Honda have delved more deeply into one association: what’s leading consumers to associate Honda with ‘Innovation’.

Add Context, Add Value:

So there’s clearly plenty of interesting, even useful, insights that can be gained from social listening and analysis. But to make this ‘worthy’ of a place on the annual report, this information needs to be contextualised, because with context comes actionability and value.
For example, it’s important to look not just at a number, but at patterns and changes in that number across time. If we can see that net sentiment scores have gone up significantly over the past 12 months, then how can we learn what caused it, and try to repeat the trick over the next 12, for example.
Another example of context adding value is perhaps one which will make the audiences of annual reports take notice more than any other. By overlaying sentiment (or other social insights) data with financial data (sales, revenues, turnover etc), we can identify association, causality, and even predictive power behind the data.

Actionability:

Of course, the key to most market research or insights-gathering activity is in making the outcomes actionable. Insights are used to inform organisations’ marketing messages, campaigns, product strategy, customer service offerings, and so on.
In the context of the Annual Report, ‘actionable’ means something slightly different. It relays the successes of the year just past, and hopes to paint an informed, positive, picture of the year(s) to come. So, as well as needing a generally bullish set of information to keep the readers and shareholders optimistic, we also want to prove to them, and demonstrate, that our plans for next year are based on something solid: genuine consumer insights & feedback from this year.
Another consideration here is that it’s not just current stakeholders who read companies’ annual reports. They are also, clearly, a big part of organisations’ outward presence. The media will pick up on figures and messages from any large or significant business, so furnishing them with some extra information, in the form of consumer opinions and online insights could help get the company more (positive) coverage. Likewise, what about attracting new investors to the organisation? Whether a start-up looking for some cash, or a bigger company aiming for large-scale funding, investors will want to know what customers of the company think. Once again, where better to look than online?
Annual Report Finance Segments

What does it mean?

So, while the figures, the financial audits, the performance charts will always make up the bulk of the Annual Report, there’s room for more persuasion. Every company has a degree of equity, and potential, tied up in its brand and its reputation. With social media analysis, we can start to quantify this, model it, and make it accessible. Such information can add nuance, relevance, and even predictive power, to the pound, dollar, yuan, and euro signs dominating the Annual Report.
Investors actually don’t just need to know how much their stake is worth right now. They want to know what the market, and the reputation of the brand within it, has in store for their stake in the next year.

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