“The risk posed by social media for your company … exists whether you participate or not,’ observed Darrell Heaps, CEO of Q4 Web Systems, an IR website and communications firm out of Toronto. ‘If you’ve ignored social media and said there are too many risks, we‘re not going to get involved, then you are putting your company at higher risk … than if you know how to use the tools. The market doesn’t care whether or not you’re there. They’re going to use the channels that are most readily available to them to put their message out.’

Heaps made those comments during a panel discussion yesterday in downtown Minneapolis on best practices for using social media to communicate material information, co-sponsored by the Dorsey & Whitney law firm and the Twin Cities NIRI chapter.

Facebook, Twitter, YouTube and blogs, collectively referred to as ‘social media’, have worked their way into the IR conversation. As evidence of how hot the topic is, NIRI chapters as well as consultants have sponsored several events on the topic around North America over the past six months.

Embrace the trend; plan your attack; update and integrate your policies across functions; implement consciously; train your employees; monitor what’s being said about your company; and manage the process. Those were the key takeaways in Minneapolis.

“Social media defines the online experience today,” Heaps said. Over the last couple of years, the line between social media and mainstream websites has blurred, he observed. “You go to your favorite newspaper site and you see comments, profiles, people interacting. The social concept has been applied to virtually every website.”

Citing a recent study by Brunswick Group, Heaps reported that 47 percent of buy-side and sell-side players surveyed in the US and Europe were prompted to research an issue and 20 percent made an investment decision or recommendation based on information from a blog. Nearly two-thirds of the US survey group expects blogs and social media to play an increasingly important role in investment decision-making in the future.

While social media raises new issues for publicly-traded corporations that must conduct their investor relations communications within the limits of a variety of laws and regulations, the challenges are not insurmountable – and the overall value of social media to enhance a company’s image and communications with customers, shareholders, clients, suppliers and other interested parties vastly outweighs the challenges.

Business Week looked at some of that in an article regarding Twitter that was published Thursday, saying, “Companies can work wonders before Twitter’s vast interactive audience of consumers, but it’s best to start slowly and build credibility.”

Says Business Week: “Business uses for Twitter are proving to be as diverse as those for the telephone or e-mail. They generally break into two categories: ways to follow customers and ways to increase efficiency.” Note that neither of those categories sounds much like a one-way marketing communications channel. In fact, says Business Week, “Companies who try to use the tool as yet another marketing arrow in their quiver—one that mostly carries targeted, one-way messages—usually fail.”

Twitter – and social media in general – is not a marketing channel, but a conversation conduit. Companies that use it that way will derive real value from doing so; companies that use it merely as a way to distribute the latest “company line” more than likely won’t.

Incidentally, the same is true for political candidates and campaigns.

eBay CEO John Donahoe

EBay CEO John Donahoe has started using a pocket-sized video camera and the company’s internal blog to connect with eBay employees. The Wall Street Journal reports…

Amid a turnaround effort at eBay’s online marketplace, he has been meeting with the company’s merchants and taping the conversations with a Flip camcorder. He’s posted many of these to a video blog for eBay’s internal employees.

In an interview, Donahoe said he got the idea to videotape and share his encounters in the spring from Cisco CEO John Chambers, who also makes videos with the Flip camera. (Cisco bought Flip maker Pure Digital earlier this year.)

“It was like a light bulb going off for me,” said Donahoe of his conversation with Chambers at a Microsoft conference. “I don’t have time to write a blog, and [text blogs] also have the problem that they can get spread virally.” So he bought a Flip camera (on eBay, of course) and started informally recording his encounters and other thoughts to share with eBay’s staff.

“I’m trying to drive a much more customer-focused organization,” said Donahoe. “It has such a powerful impact on me. I want to use it to educate all of our employees and also celebrate some of our sellers.”

What really impresses me with what Donahoe is doing is that he is playing a central role in this social media effort, but in a way that deliberately takes the spotlight off himself. Instead, he is forging a new role for himself as a communications connector between eBay employees and eBay merchants – and as the WSJ story goes on to show, eBay already is reaping tangible benefits from it.

Cheap digital social media technology makes it possible for Donahoe – and for the leader of almost any company or organization – to create such new connections and conversations that were previously difficult to create and sustain. Increased transparency, new connections and conversations open the door to new possibilities.

If he continues with this video-interview-blogging effort, Donahoe should expect the unexpected.
He’s likely to see a lot more light bulbs going off.

Incidentally, the Flip camera is a great product, but it’s not the onlytool that works for this purpose. The new iPhone 3Gs shoots video and allows on-device editing – and can be used to post directly to a blog, YouTube or a social media site like Facebook. With the Flip, you have to be able to download the video to a PC or laptop, edit it, and then post it. On the other hand, Flip has high-def models, the iPhone doesn’t, so far.

MR. GREGORY: …the fact that in this, in this media age, what he said, by anybody’s estimation, was objectionable, to sign a petition saying the government was behind 9/11. But it goes to something that’s going on in this information age…

MR. FRIEDMAN: David, yeah…

MR. GREGORY: …which is you can be a target real fast.

MR. FRIEDMAN: David, when everyone has a cell phone, everyone’s a photographer. When everyone has access to YouTube, everyone’s a filmmaker. And when everyone’s a blogger, everyone’s in newspaper. When everyone’s a photographer, a newspaper and a filmmaker, everyone else is a public figure. Tell your kids, OK, tell your kids, OK, be careful. Every move they make is now a digital footprint. You are on “Candid Camera.” And unfortunately, the real message to young people, from all of these incidents, OK, and I’m not here defending anything anyone said, but from all of these incidents, is you know, really keep yourself tight, don’t say anything controversial, don’t think anything–don’t put anything in print. You know, whatever you do, just kind of smooth out all the edges, and maybe you too–you know, when you get nominated to be ambassador to Burkina Faso, you’ll be able to get through the hearing.

Friedman is right – at first – but then goes overboard.

Yes, in an era when everyone has or can have a cell phone, YouTube and a blog, everyone can, theoretically, be a photographer, filmmaker and newspaper. That’s the empowerment enabled by cheap digital technologies for producing and distributing content. And, yes, what people create and post online leaves a digital footprint that will likely reside on some server somewhere forever.

But Friedman goes overboard when he says people should, in reaction, “really keep yourself tight, don’t say anything controversial, don’t think anything–don’t put anything in print. You know, whatever you do, just kind of smooth out all the edges.”

Wrong.

What people should do in this current golden age of grassroots media is, think before they speak – or post online, because actions have consequences and when you publish via the online media you are making your content available to a potentially global audience. Bcause the new media is interactive and decentralized, you know not where your message will go, or who will respond to it, or how they will respond – or what social media format they will use to carry their response.

Say what you believe, and be prepared to act like you meant it. The social media is not a trap for those who follow those rules.

But as the state-run company grows, it is attracting the scrutiny of Brazilian investigative journalists and senators who worry that billions of petrodollars might be put to political use. And that’s not sitting well with Petrobras CEO José Sergio Gabrielli, a left-leaning former economics professor and close adviser to Brazil’s President, Luiz Inácio Lula da Silva. While the Brazilian government holds 38% of the publicly traded Petrobras shares, it controls 55% of the voting rights.

In May, the Brazilian Senate launched an inquiry to determine if Petrobras had evaded more than $2 billion in taxes by channeling funds to nongovernmental organizations (NGOs) run by political allies of President Lula in the runup to next year’s presidential elections. It also started looking into alleged overpayments for ships and pipelines. That’s when Gabrielli—frustrated by newspaper reports that he complained were tendentious and quoted him out of context—ordered his public relations team to create a blog called Petrobras—Facts and Figures.

“We’re Going to Defend Ourselves”

Gabrielli says he personally signs off on many of the company’s daily postings on the blog, which is published only in Portuguese. The idea is to rebut what he calls “false information” in the Brazilian press about the company. But the site, which has had more than 1.5 million visitors, is raising questions about whether one of the region’s most respected state-run companies is harming its reputation by being so combative. “We’re going to defend ourselves,” Gabrielli told a reporter from leading newspaper Folha de São Paulo in late June, in a Q&A posted on the blog. “Attacking is also part of defending oneself.”

One of the first things the Petrobras blog did was to publish the entire transcript of an interview Gabrielli granted to a major newspaper—before the newspaper’s article appeared. That infuriated journalists throughout Brazil, who claimed that their questions are the intellectual property of their publications—and in any case, out of courtesy, should not be aired before an article appears in print.

Petrobras agreed to wait until midnight before an article’s publication to post transcripts on the Web, but it still takes a no-holds-barred approach to rebutting, point by point, every major news report.

Petrobras avoids making inflammatory statements about journalists in its daily postings. But its pointed rebuttals spawn vociferous reader comments that accuse journalists of working for political parties or belonging to a conspiracy to turn over Brazil’s oil riches to foreign oil companies. One blog post by a reader identified as Da Torre said that “the Folha [de São Paulo] never tires of making up facts to denigrate Petrobras’ image. Could it be that they are working for the multinationals to knock Petrobras down and…grab the best thing Brazil has, its oil?”

Mesh Media Strategies has always advised its clients who may be interviewed by the media – any media – to record the interview and be prepared to use it to combat misleading media reports which use bits of the interview out of context. This applies to both corporate clients and political candidates. Ideally, the interview should be video-recorded, with cameras on both the reporter and the interviewee. Immediately after the interview is concluded, a verbatim transcript of the interview should be made, and the video or audio of the interview should be prepared for uploading to the web. YouTube is a good platform for video, while a corporate or campaign blog can easily handle an audio file as a “podcast.”

No corporate CEO, organization leader, business owner or political candidate should ever do a media interview without recording it – and no corporate CEO, organization leader, business owner or political candidate should agree to an interview with any media outlet that refuses such conditions.

I have been on both sides of this issue.

Several years ago, I managed to land an interview with music superstar Garth Brooks as his fame was peaking – an interview not for an entertainment magazine, but for a business magazine called Business Nashville. (Today, it’s called Business TN.) The focus of the interview was not music but money and Brooks’ approach to business. In granting the interview, Brooks’ people asked that he be allowed to record the interview.

I had no problem with that request, because I had no agenda in doing the story. I was going to record the interview to ensure accuracy, and didn’t mind if he did the same. I tell clients today, if the media doesn’t want you to record the interview and post the recording or a transcript, they’ve got an agenda.

Brooks did the interview but, as it turns out, his people didn’t record it. They did ask to review the quotes we selected for the story, and although all of the quotes were verbatim, Brooks did ask – not demand – that we delete one sentence because the situation he was talking about – ironically, involving Brooks and a dispute with a major national newspaper – had been resolved since the interview. The quote was accurate but the context had changed, so I made the edit. The result: An accurate story.

Garth Brooks didn’t need to record the interview because I came to it with no hidden agenda, but today’s professional news media is so rife with bias and agendas that you can’t take that chance. Even if the media isn’t biased or coming at you with a hidden agenda, the chances are still high that you will be misquoted or information you give will be used in the wrong context. No member of the media knows more about your business or your campaign than you do, which means there is a good chance they’ll get it wrong.

Having audio or video recordings and a verbatim transcript means you can quickly respond when they do.

Transparency is a two-way street – a media outlet which demands transparency but refuses to grant it is not to be trusted.

Because of their cheap fares and high customer service rankings, both airlines have legions of loyal travelers. Part of that loyalty can also be traced to fresh marketing that tries to put some fun in flying. JetBlue’s tongue-in-cheek ads have urged executives to get off their private jets and fly JetBlue. In Southwest TV ads, CEO Gary Kelly told customers “It’s On” in New York.

Both airlines are on YouTube. Blogs and Twitter are also important parts of their brands.

JetBlue’s social media efforts include a robust Flickr photostream. Southwest’s highly regarded blog, Nuts About Southwest, also links to a Flickr photo gallery. On YouTube, JetBlue is here and Southwest is here – and Southwest has the clear lead over JetBlue in terms of channel views and subscribers on YouTube. If JetBlue has a recently updated blog, it isn’t easy to locate – though the former blog of a former CEO shows up high in the Google results.

You can follow Southwest on Twitter @SouthwestAir, while JetBlue is on Twitter @JetBlue – where its more than 1 million followers is more than double the current number of people following Southwest on Twitter.

Neither airline features their YouTube, Flickr, Twitter or Facebook links on their consumer-facing home pages, though Southwest includes a text link to “our blog” – which does feature its social media efforts. The Southwest blog even links to CEO Gary Kelly’s LinkedIn profile. (Looking at the LinkedIn-created pages for each company. JetBlue’s is better than Southwest’s.

Although JetBlue is trouncing Southwest on Twitter, on balance it is clear Southwest has the edge in understanding and using social media. Whether that translates into winning the Battle of Boston remains to be seen. That Twitter lead is potentially a huge edge for JetBlue.

If Mesh Media was advising Southwest, we’d urge them to focus intently on growing their Twitter following – and using Twitter as a promotional channel to reach fliers in Boston and beyond – and market to them. (One thought: Offer a free round-trip ticket each week to one random Twitter follower, to grow the number of followers rapidly. Then market extensively to Twitter announcements of fare sales, new routes, etc.)  If we were advising JetBlue, we’d urge a more integrated and cohesive approach to its social media – and a blog that belongs to the airline and would continue on past a change in leadership at the top.  A million-plus followers on Twitter is a great ready-made channel for promoting the airline – and a blog can be programmed to automatically “Tweet” on Twitter and Facebook.

Mesh Media’s favorite airline is Southwest – we love the low fares, the good service, the boarding procedures and the attitude. We’ve never had the opportunity to fly JetBlue as they don’t currently serve our hometown, or we might like them too.

One thing I’d like to see Southwest offer – a free iPhone app where a person could check fares and schedules, make reservations, check in and track Rapid Rewards points.

Update 8/17/09: Southwest Airlines responded via Twitter:

@meshstrategies Use mobile.southwest.com save on your homepage as a bookmark!

Done. Looks good. Works like a good iPhone app. Thanks. Another reason why Southwest is our favorite airline.

Next time, though, they should tweet the company news via an official Telstra Twitter page, not on an employee’s personal Twitter page.

Speaking of official company Twitter pages, the recent hacker attack that bedeviled Twitter and made access to it rather spotty shouldn’t scare businesses away from using the service – but they should learn a lesson from it: Don’t rely on any one social networking medium as your online communications tool. Instead, spread out across several. Have a Twitter page, a Facebook presence and a YouTube channel. Be involved in the blogosphere. Make sure your key executives have LinkedIn profiles. Use text messaging. Each of those can be an outlet for company information and marketing messages and a two-way street for communicating with your customers, clients and supporters.

The goal isn’t to spread yourself thin but to reach your audience in all the ways they prefer to be reached or to access information.

They’re right, of course.

The communications challenges facing businesses are as varied as the businesses that face them – and the array of communications tools that are available to help solve them. Mesh Media isn’t here to sell you the latest digital media trend using the latest buzzwords – we’re here to help you solve your communications challenges with the right tool or tools for the job. If that’s Twitter and a blog, okay. If it’s a more traditional media relations approach, okay. If it’s a blend of traditional media relations, advertising and social media – or if hiring a plane to write your company’s name in the sky would do the trick – that’s okay too.

Not every CEO needs to be a social media star, but every CEO ought to make sure their business is taking full advantage of all the available communications tools, technologies and trends that make sense and get the job done. Like it or not, you’re doing business in the age of interactive media and digitally-empowered customers who seek transparency and connection and community and see through the latest slick ad campaign. You’re doing business in the era of the iPhone and Skype, YouTube, LinkedIn, podcasts and other user-generated content and if your businesses isn’t using certain social media tools because, after careful review, you believe they don’t fit the need, that’s one thing.

But if you’re not using the tools because your business doesn’t know how to use them, and you aren’t making the effort to understand them and their potential, then chances are your business is leaving some powerful business-building tools gathering dust on the shelf.

Smart employees understand the power of social media in creating real business value and relationships with customers, the press, analysts, and all other stakeholders. But many employees haven’t realized that they’ve also been marketing their personal brand at the same time they’ve been pushing their company’s. By participating in social networks, employees have already cultivated a network that can help serve them today, six months from now, and throughout the rest of their lives.

Building personal brands and strong networks is critical right now. The economy has made the job market so cutthroat that there are 5.4 candidates for every open job, according to the U.S. Bureau of Labor Statistics. If you aren’t meeting and exceeding corporate expectations, you may turn into a job seeker before you know it. To stay competitive in this environment, the two most important words for employees are “value” and “visibility.”

My advice is take advantage of the fact that branding has been transitioned solely from the grasp of companies and their “official” brand messengers. Regardless of your job title, social media allows you to assist your company like never before, while also garnering some career protection for yourself.

Excellent advice. Meanwhile, the Wall Street Journal explores the flip side of social media for business – the potential for leaks, in a story headlined Leaks Grow in World of Blogs; Companies Search for New Ways to Stop Disclosures of Sensitive Information.

Employers have long sought to keep sensitive information private, and used a variety of techniques to plug leaks. But the emergence of blogs and Web sites, many targeted to a single industry or niche, combined with an abundance of recession-related bad news, has given the issue new urgency.

Is your company ready for these challenges?