Twitter’s reputation as a corporate communications tool took a beating lately with the high-profile hacking of the accounts of such companies and organizations as Burger King, Jeep and even the British Broadcasting Corp.
But for lesser-known, lower-profile companies, Twitter has played the role of an equalizer, a way for them to more effectively communicate their message to Wall Street, according to a new study. Companies that typically don’t get much media attention, especially during earnings season, have been able to make up for that lack of exposure by communicating their information via Twitter, the report said.
The study was conducted by professors from the Stanford Graduate School of Business and the University of Michigan.
The professors, Elizabeth Blankespoor of Stanford and Gregory Miller and Hal White of the University of Michigan, “suspected that Twitter and other technologies were changing the old rules,” a Stanford report on the study said.
“For the first time, companies could communicate with investors directly and instantly,” the report said. The research study said, “Anecdotal evidence suggests that Twitter is IR professionals’ new technology of choice for breaking firm news.”
The report debunks the assumption that markets immediately absorb all information that companies put out, the study found. In fact, most investors get their information from major publications such as The Wall Street Journal and Bloomberg, which also tend to focus on high-profile companies.