Executive bloggers ‘humanize’ their business

Adding to your company’s bottom line is always challenging, and many business executives believe that blogging attracts clients, loyalty and assistance in making better products and more profits.

For small- to medium-sized companies, blogs can reach a broad spectrum of potential customers, according to Todd Vernon, chief executive of Louisville-based Lijit. His blog – www.lijit.com/blog – has been up and running since 2006.

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“Through blogging, you can understand a company’s business. It’s not sterile like a press release. You get news and information from an executive point of view,” Vernon said. “What’s cool is the transparency. You can communicate information you would use as an e-mail outreach, but people don’t want to be bothered with marketing press releases. Blogs communicate what’s interesting about your life and your business.”

New blogging tools make it easy to start writing online. Peers and customers can give their input just as easily through commenting and linking features. This is an unexpected bonus and better than just broadcasting a message.

“It’s a way to disseminate ideas and have conversations. It’s more meaningful to have a conversation than a monologue,´ said Amy Gahran, a conversational media consultant in Boulder.

She said customers get a “better sense of where the company is going.”

“You can say why you’re setting certain priorities, and people appreciate it. It helps customers feel like they matter,” Gahran said. “That’s more credible than always showing successes and marketing spins in press releases.”

Vernon agreed and admitted he is “more reachable … It makes for more loyal customers, which helps the bottom line.”

A corporate blogging study conducted in November 2006 by Porter Novelli International, a New York-based public relations and lobbying firm, showed half of all companies with 20 or fewer employees had executive blogs. However, only 8 percent of Fortune 500 company executives are blogging, according to the Fortune 500 Blogging Wiki, a collaborative tracking site.

Novelli’s research indicated that large corporations cite a lack of staff and resources for not having corporate blogs.

Jonathan Schwartz, chief executive of Emeryville, Calif.-based Sun Microsystems, is one of the few Fortune 500 CEO bloggers.

“There’s a misconception that it takes time, especially for a CEO of a large corporation,´ said Kathy Keating, founder of Louisville-based TriCalyx and author of its blog (www.onlineoptimist.com). “It only takes five to 10 minutes a day.”

Larger corporations, however, have more legal channels to traverse, so it may take extra time, “but it’s worth it to make the commitment. It’s a great channel into people that matter; it builds reputation and captures your vision without a lot of overhead,” Keating said.

However, Terry Gold, chief executive of Boulder-based Gold Systems, said companies can’t use blogs an integral part of their marketing campaign.

“You can’t view it just as a marketing piece – it won’t have credibility,” Gold said. “You must make it valuable with entertaining writing. It’s a commitment to keep it up to date, and you have to think about the people who read it.”

Gold’s blog (www.terrygold.com) started in 2004 and discusses what he’s passionate about. He has actually hired people that commented on his entries and plans on hiring more in the future.

“I occasionally write about speech recognition, and I met a guy through his comments on my blog,” Gold said. “He was well-versed in the topic and knew what he was talking about. We hired him a few months ago.”

Additionally, CEOs read other executive blogs. Gold, Vernon and Keating have links to blogs they read consistently so they know what is going on in their business community. They even talk with other CEOs on each others’ blogs.

 “I realize competitors and other companies read my blog, so I have to think about what they’re getting out of it,” Gold said.

Although the chief executive who blogs may humanize his or her company, they have to be careful about what they write.

The U.S. Securities and Exchange Department, or SEC, has the Regulation Fair Disclosure rule in regards to public dissemination of investor materials. This requires companies to make announcements about topics, profits, new products and mergers in a filing with the agency or in a press release so that all investors can learn of the news simultaneously.

In 2000 the SEC stated that posting the information on a Web site would “not by itself be considered a sufficient method of public disclosure,” so as not to give advantage to certain investors.

John Heine, an SEC spokesman, said that Web and blog access makes it difficult to change this rule without going through a legal vetting process.

“There are situations involving mergers and takeovers, about what people say and how they say it that is not limited to blogs. If you’re involved in a public company, you must be careful. Information affects markets. It’s a matter of ease of access,” Heine said.

Lijit’s Vernon agreed. “From an intelligence point of view, if you can’t talk about it at a cocktail party, you shouldn’t talk about it in your blog. It’s just smart business.”