Best IR Practices During a Bear Market

Markets move in cycles, so let’s face it, bear markets are inevitable.

During difficult times, management may feel stressed. However, we understand that a lot of valuable work can be done in investor relations.

Bear markets are really an opportunity to be strategic and prepare your company to succeed during the next bull run. Here are four IR practices you can do during a bear market.

#1. Explore New and Innovative Investor Marketing Methods

One of the first activities we recommend focusing on is exploring new and innovative investor marketing methods.

IR moves in trends, so what worked 6 months ago may not work today. This especially applies when doing investor marketing – a very valuable activity in IR.

Gaining new investors during a bear market is a huge asset for management so getting creative and practicing trial and error is usually involved when trying to succeed in this activity. To ensure success, we set KPIs to stay on track with our targets.

In addition, it’s important to have a clear understanding of your target audience and tailor your marketing approach accordingly. This involves identifying the demographics, interests, and investment goals of potential investors, and crafting a message that speaks directly to their needs and desires.

#2. Networking

Networking is a critical aspect of personal and professional development, and it is especially beneficial during a bear market.

Networking helps you expand your circle, gain new perspectives, and potentially open doors to new investors.

Some ways to be successful in growing your network are to:

• Be Intentional: Identify the types of people you want to connect with and actively seek them out. Attend events, join professional organizations, and participate in online communities where they are likely to be found.
• Offer Value: Instead of simply trying to take from your network, focus on how you can add value. This could mean sharing interesting articles, offering introductions, or providing support when needed.
• Stay In-touch: Regularly touch base with your network, whether through email, phone, or in-person meetings. Consistent follow-up helps to maintain the relationships you’ve built.
• Listen: When you engage with others, listen more than you talk. This helps you understand their perspectives and interests, which can lead to deeper connections.
• Be Generous: Share your resources and connections with others, and be open to helping others in any way you can. Generosity builds trust and strengthens relationships.

Remember, growing your network takes time and effort, but the benefits are well worth it. Cultivate meaningful relationships and you’ll have a supportive network that can help you achieve your goals.

#3. Communicate With Your Investors

Ghosting investors is a common practice among publicly trading companies, but it can have serious consequences. When you ghost an investor, you’re essentially breaking off communication without explanation, and this can cause harm to your reputation and future funding opportunities. Some consequences of ghosting investors include:

• Loss of trust: Investors put their trust in you and your company, and ghosting can cause that trust to evaporate quickly. This can be difficult to rebuild, especially if you plan to raise funds in the future.
• Damage to reputation: Ghosting can damage your reputation within investment communities, making it more difficult to secure funding in the future.
• Missed opportunities: Investors often have a vast network and can provide valuable connections and insights. Ghosting can cause you to miss out on these opportunities.
• Lack of professionalism: Ghosting is unprofessional and shows a lack of respect for the investor’s time and resources. It can also reflect poorly on your company’s culture and values.

Instead of ghosting investors, it’s better to communicate openly and honestly, even if the news is not good. Be transparent about the status of your company, and provide updates on any challenges or obstacles you’re facing. Investors appreciate honesty and will respect you for it in the long run.

#4.Highlight Your Defensive Qualities

During a bear market, it can be challenging to attract investors to your company. However, if your company has strong defensive qualities, there are a few ways to highlight them and attract potential investors. Here are some strategies that can help:

• Focus on Strong Fundamentals: Emphasize your company’s strong fundamentals such as a diversified customer base, a strong management team, a sustainable competitive advantage, and a solid balance sheet. These can provide a solid foundation for long-term growth and resilience.
• Showcase Your Industry’s Recession Resistant Qualities: Some industries are more resilient during economic downturns than others. If your company operates in a recession-resistant industry, emphasize this fact to investors.
• Highlight Previous Performance: If your company has performed well during previous bear markets, make sure to emphasize this to investors. This can help demonstrate your company’s ability to weather difficult market conditions.
• Stress your Risk Management Strategies: Show that your company has a robust risk management strategy in place that can mitigate risks associated with a bear market. This can include strategies such as hedging, cost-cutting measures, and diversification.
• Discuss Your Long-term Growth Prospects: Investors are often looking for companies with long-term growth potential. If your company has a solid plan for growth, highlight this to investors. It can help them see beyond the short-term fluctuations of the bear market.

By emphasizing these factors, you can show current and prospective investors that your company has what it takes to weather a bear market and emerge stronger on the other side.

At Apollo, we strive to be leaders in the field of investor relations, and our innovative approach to IR helps us stay on top of the latest trends. Reach out today for a complementary consultation.