“A very strong year” or how to decipher the code used in financial results announcements

I play a little game each year. It’s called “Recessionate!” and involves spotting the most over-used words in annual results announcements and matching it to where we are in the economic cycle. It’s pretty straightforward: “solid” or “resilient” is used for the middle of a slowdown (as in, “we made solid progress despite a difficult economic backdrop”) “strong” indicates the middle of a growth period, and “excellent” usually points to imminent financial Armageddon.

The last time I wrote about this was in January 2013, when lots of companies had had a bad year: “solid” was therefore the order of the day. Aviva made “solid progress”, despite losing £3 billion, and BP even managed to lay a “solid foundation for growth in the long-term”. There were lots of “difficult economic backdrops” and “challenging economic conditions”, although most companies were “well-positioned to deliver future growth”.

This year was a hard one to call. “Strong” featured prominently in a number of announcements, not least for commercial real estate companies (Unibail, Land Securities, Hammerson) Technology companies went off-script. Apple even described its results as “exceptional” – usually a big no-no for results announcements as it implies they might be unrepeatable. Elsewhere, “competitive” made a big appearance in any consumer-facing company (Unilever, Sainsbury’s) and the “challenging” backdrops and markets were still there. “Well positioned” was another winner, (BP, incidentally, has moved from its solid foundations to be “well positioned to face challenges”) particularly for companies with a “clear strategy” who are “focused on growth”.

This semantic analysis matches the real world, where it’s pretty hard to work out what’s going on economically. However it still serves to demonstrate the surprisingly strict unwritten code governing this type of announcement, which I experienced recently during a ‘critical read’ of a client’s announcement. They had used the word “strong” three times on the same page, and I tried in vain to find direct equivalents. “Good”? Doesn’t convey the same force, and somehow implies the sales might have been an accident. “Robust”? Not bad, but perhaps a bit too close to the slowdown-appropriate “resilient”. “Outstanding”? See comments on “exceptional” above.

A former boss took this code to its ultimate conclusion: he said there was no point in sweating blood over the chairman’s quote for a results announcement as it can almost always end with the words, “I look forward with confidence to the future”. I was therefore delighted to read the end of Glencore’s statement :

“As the most diversified raw material producer and marketer, Glencore is well positioned to react to and benefit from changes in commodity fundamentals… We look forward to the future with confidence.”

3 Ogilvy commandments that apply to B2B communications

I finally got round to reading David Ogilvy's Confessions of an Advertising Man. Published in 1963, I expected it to be a quaint look into the Mad Men era. In fact most of what I read not only still stands, but seems more relevant than a lot of present-day articles that focus on brand at the expense of sales.

I was also astonished at just how much of what Ogilvy writes about mass advertising of detergents and cars is equally true for B2B communications. His comment that agencies are infested with people who regard their work as an avant-garde art form, and are more interested in winning awards than selling products for their clients, for example, rings depressingly true. But the book also includes positive tips to improve your own work. Here are my top three, and how I think they apply to B2B comms:

1.    Your most important job is to decide what benefit you are going to promise

Appealing to the reader's interest is key to success. This is equally true in a brochure selling engineering services (where readers may be keen to "avoid factory shutdowns" - so interested in services that guarantee machine performance) as it is for a TV ad for a face cream that "cleans deep into pores" or washing powder that "washes whites whiter". Describing the end result for the user outguns describing the product itself. This can also impact the structure of your offer, as it makes you think about what the client is actually buying.

2. Tell the truth, but make the truth fascinating

This might seem self evident, but is often not observed in B2B communications. The first draft of text describing complicated products and services is often produced by the specialist, and little changed by the copywriter, who finds it difficult to understand and is worried about looking stupid in front of their client. But nothing is too complicated to be explained simply, and in an engaging way. The key to this is asking your client very basic questions, and making sure you pin them down on a clear answer. Contrary to what you think, clients tend to like this, and will think you are thorough, not stupid.

3. Search all the parks in all the cities; you'll find no statues of committees

To work well, communications need to have a limited number of clear messages. Numerous people involved, with different, sometimes conflicting objectives, gets in the way of this. Avoid sign-off by committee: invite input from several people by all means, but be clear that not all comments will be incorporated. This depends to a large extent on your internal client, but you can start by explaining why it's important and suggesting an approval process that is less likely to lead to death by a thousand cuts.

What do Michelin-starred chefs and corporate communications have in common?

“Reduce” is a word with fairly negative connotations. Not so in cooking. One of the prized arts of a star chef is “reduction”, the process of thickening and intensifying the flavour of, for example, a delicious red wine sauce.

What does this have to do with communications? Many businesses try to explain what they do by detailing their products and services, then providing figures on, for example, how many people they employ, how many countries they operate in, or how much money they make. 

The result is a sort of corporate shopping list that is not only internal-facing, but also tends to send the reader to sleep. Examples abound but this description from a large healthcare provider comes to mind:

“X supplies medical gases, home healthcare services, hygiene products, medical equipment and specialty ingredients. In over 30 countries around the world, X influences the lives of more than 1 million patients at home and serves over 7,500 hospitals and clinics.”

How, then, to use reduction to intensify the flavour of your corporate communications? And why would you want to?

First of all, even very smart people have a short attention span. So whether you’re speaking to someone standing in front of you, or writing for the web, it’s useful to know how to get your core idea across in a couple of sentences.

Secondly, the process involved in boiling down a message to its essential flavours helps you know what you’re really selling, who you’re selling it to and why they’re buying it. This in turn shapes everything you will say about the brand or product.

So here’s a quick recipe for achieving a tasty reduction:

1) Jot down the answers to some key questions: What is the “problem” your business

solves? How exactly does your business address this problem? What is the purpose? Who is your primary audience? What’s your competitive advantage? What evidence do you have to back up these claims? What will the world look like if you achieve your vision?

2) Take your notes – you will probably have a side or so of A4 – and use the same structure to write out a long version of your “core story” – the essence of who you are and what you do. Cut out words, repetitions, and some stats. Your first draft of this might be around a page.

3) Turn up the heat: look at what you’ve written. How much is repetition, or waters down what you’re trying to say? Cut out words, some stats, flabby turns of phrase.

4) Repeat step 3.

5) Repeat step 3 again.

What are you aiming for? Ideally under 100 words, and if you can do one sentence, with under 25 words, so much the better. Bear in mind though, that this may not be possible: there’s a point at which reduction sends you into dangerous territory. At this point it’s useful to apply the sausage factory test, which I wrote about in a previous post: you may have a snappy sounding strapline, but could it also apply to your competitor, or indeed a company in another industry entirely?

For inspiration, GE does a good job. I’ll leave you with their take on healthcare. At under 80 words, it does an exemplary job of saying what GE does, where, and why:

“GE is constantly working to make the world a healthier place by supplying the healthcare technology that saves nearly 3,000 lives every day. Our focus is on helping medical professionals make an earlier, more accurate diagnosis of disease and then better equipping them to treat it. We’re also designing the tools that make healthcare available in even the most remote parts of the world. Anywhere there is a need for better healthcare tools, we are there.”

Happy cooking!

Fire the consultants, now

A friend who works for the IT division of a large financial services company received a company email yesterday. A full five-scrolls-of-a-Blackberry long, it began by announcing that as employees were no doubt aware, in response to the global economic crisis, departments had been “rightsized” in 2009. Over subsequent years, teams had “responded to the new economic situation by engaging external talent to fulfill specific project requirements and respond to client needs”. However, as the result of a “detailed resource analysis”, it was now imperative that these resources be “optimized” and the company would therefore be embarking on a “major reinternalization program”.

A simpler way to write this email might have been: “A lot of your colleagues were fired five years ago. Since then, the rest of you have been hiring consultants to replace them because you had far too much work to do and the clients were starting to notice. But the last bill from Accenture was eye-watering so you need to fire the consultants, now.”

Apart from being badly written, this email is liable to inspire panic in anyone who actually manages to understand it – crucially, it doesn’t explain whether managers are allowed to hire new employees, or are expected to do the work themselves. In fact it’s the perfect example of why HR departments should be kept well away from internal communications.

Many companies do internal communications less well than external communications. The victim of lack of time, lack of money, and horrific internal politics tends to result in an un-coordinated approach whereby a continual stream of organisational memos by HR drowns out any interesting stuff on strategy, new tools or indeed anything that would help employees do their jobs better or feel proud to work for the company.

The rather worrying result is employees who may know their company has an equal opportunities policy, but who have no idea what its objectives for the year are (or indeed how what they themselves are doing contributes in any way to the company’s success).

Digital offers lots of innovative ways to communicate better (or to use current jargon “engage”) with employees, from social intranets or wikis to internal apps. But the baseline has to be writing in plain English so that people can understand what you’re saying. The rest is a nice-to-have.

Overcoming malscribophobia: the campaign for plain writing

I’ve been suffering for a while now from malscribophobia. For anyone who hasn’t heard of this debilitating condition, it’s an extreme intolerance of bad writing, manifested in sudden flushes of rage at missing apostrophes, spurious capital letters, excessively long sentences and the like. 

It’s been getting worse. It began with English and has recently spread to French. And here’s the thing they don’t tell you: there’s a lot of bad writing in French.

The problem is, French is a language that appreciates “style”. Even the phrase used to describe being able to write well - “avoir une belle plume” – buckles under the weight of “style”. When style is prized over substance, or confused with cliché, the results are disastrous.

Take the guidebook to Venice I bought for this year’s holiday. Published under the brand of a well-known travel series, it should have been informative, with some choice historical anecdotes, clear recommendations, and visual and linguistic devices to help you navigate the book (and most importantly, decide what to do after the morning’s third cappucino).

Instead, what emerged from the pages was a step-by-step massacre of both Venice and the French language. You’d need to read the whole book for the complete, awful experience, but here are a few of my favourites:

1) On the complex reasons for the decline of Venitian domination of the Mediterranean, and the completely unrelated fact the city is home to Vivaldi:

“Après avoir perdu sa suprématie maritime, Venise découvrit le pouvoir de la musique”
("After losing its naval supremacy, Venice discovered the power of music")

2) On the fact that the relics of St Mark were lost at some point in history (crucially, it doesn’t bother to explain when, or whether they were ever found):

“Les voies du Seigneur furent parfois obscurcis par la poussière des travaux: on égara par deux fois les réliques du Saint”
("The way of the Lord was sometimes not easily visible through the clouds of construction dust: the Saint's relics were lost twice")

3) And finally, on the reasons why the glassmakers of Murano would choose to demonstrate their skills in public (incidentally they don’t – expect to see a handful of very overpriced shops):

“Aujourd’hui, conscients de ne pouvoir être égalés, le verriers oeuvrent au vu de tous…”
("Today, in the knowledge they cannot be rivalled, the glassmakers work in full view…")

If overstylised and meaningless sentences like these weren’t enough to bring out a severe episode of malscribophobia, the titles and icons used to guide readers through the book would tip anyone over the edge. 

Every single phrase came from the same banal list of infantilised and lazy travel-speak. So each area had “Les incontournables” and “Le meilleur du quartier” (with a little heart next to it – perhaps this was supposed to convey why the list was different from “Les incontournables?”) A separate list of things were “100% venitien” (unlike, one presumes, everything else in a guidebook about Venice?) and an extraordinary number of things were in a patronising diminutive: “une petite faim”, “un petit café”. The overall impression was of a restaurant guide for 7 year-olds.

The immediate solution was easy – throw the book in the nearest canal – but the wider problem remains. Malscribophobia doesn't actually exist – I made that bit up – but bad writing is everywhere. I’m making it my resolution for the rentrée to be even more intolerant of sentences with no meaning, uneccessary clichés, and patronising turns of phrase. The campaign for plain expression, writing that actually means something, starts here.

Actionaria - what do retail shareholders want from communications?

I’ll be heading to Actionaria tomorrow, the annual show for retail investors in France. It’s mainly out of nosiness – having produced a brochure for one of my clients, I’m quite keen to see what the competition has come up with.

Retail investors are a small but important group – typically they are “sticky” shareholders. In it for the long term, goes the conventional wisdom, they are loyal to existing management and can help counteract price volatility resulting from trading by high turnover institutional investors, or market stress.

But what retail investors want – and therefore how companies should communicate with them – tends to be a relatively neglected area of research. Three facts stand out:

The first is that retail investors invest overwhelmingly in household names. In recent research by Investec Wealth & Investment, over half the 2,000 interviewees declared they were more likely to buy shares in well-known companies. Moreover, the same proportion would continue to hold such shares even if they performed poorly.

The second is that they want a simple story. They want to know what the company does, how it makes money and its vision for the future.

The third is that retail investors overwhelmingly use the internet to make decisons: research by the SEC shows that 4 out of 10 private investors will visit a company’s website to gain information.

What does this mean for communications?

First of all, if you’re not a household name, time to demonstrate how you fit into people’s lives. IMI proudly announces on its homepage, for example, that it “converts industry knowledge and market insight into design-engineered solutions”. This doesn’t mean much to most people. Dig deeper in the website and you discover they play a crucial role in areas of concern to the general public, such as clean energy, energy efficiency and healthcare. There’s material for a compelling retail shareholder story here – but it isn’t being told.

Second, make the most of the "third party" channels these investors rely on: press, and retail brokers (particularly in the UK and US). Not only do they reach a wider audience, but their independent view makes them valued by small shareholders. Tell your story simply to journalists and brokers. Then keep telling it.

Finally, invest in your website. Navigation is key – your audience is internet-friendly but not necessarily internet savvy. Ensure your IR site and annual report are no more than one click away from the homepage. Both the homepage and the IR landing page should provide an overview of what the company does, with information logically arranged so investors can quickly and easily locate what they need. Shareholders should have the option to subscribe to regular email alerts, or dedicated shareholder newsletters to keep them up-to-date with the company and generate further loyalty.

The limits of fluent

I was once checking in at a remote airport in the middle of China when I saw a sign behind the airline representative that made me erupt in a fit of giggles. “We take your bags and we send them all over the world!” it proclaimed proudly.

Trying to convey to the well-meaning Air China representative why this was so funny proved to be a non-starter. “It is not correct?” she enquired, sadly. “Yes and no. It’s hard to explain. But it doesn’t matter”.

It didn’t matter, of course. My bags arrived in Beijing, and subsequently at Heathrow. But this mistake – the result of someone who thought they could speak perfect English being allowed to print a sign - is repeated ad infinitum around the world in contexts where it does matter. Where the worst that can happen isn’t that a foreign tourist might have a good laugh on the last day of their holiday – it’s that you will look unprofessional to potential customers.

There’s a very odd phenomenon – let’s call it monolingual hubris – where people who are really, really careful about their own language, and would be horrified to send out anything with a misplaced comma or wrong adjectival ending, think it’s absolutely fine to publish something they’ve written in another language without getting it thoroughly checked first.

I know, because I’ve suffered from monolingual hubris myself: I once tried writing a website in French. It took me days. Weeks, even. I felt terribly clever when I’d finished. Gramatically it was virtually flawless. There was one small problem. It just didn’t read like French. It was the website equivalent of taking your bags and sending them all over the world.

There are a few exceptions to this rule, Samuel Beckett being the obvious one. But most of us are not Beckett. I’m fine with that, and now announce cheerfully to clients that I don’t write in French, but can introduce them to a great French copywriter if they need one.