It is Almost like the Middle Man Isn’t Needed Anymore…

The standard press release. For decades it has been the weapon of choice for flaks to disseminate “important” news and updates. Its beauty was in its simplicity. It is a static, controllable, one way communication tool that tells the reader everything the company determines is valuable, newsworthy information. It even spawned the PR wire service industry seen through companies such as PR Newswire and Business Wire.

I thought there was nothing that could take down this now trival document, but the SEC announced it will now allow companies to satisfy fair disclosure requirements through their Web site. What does this mean? Well instead of two pages of hype and quotes fired off to any and every reporter that could possibly be coaxed into covering a company update, we can now communicate legally via blogs and other Web 2.0 technologies that allow for audio, video and images packaged around bulleted top line information that can be accessed by RSS feeds. Some suggest this opens the door for the Social Media Release. I suppose this could advance communication, assuming it is not riddled with corporate speak. Hopefully the most powerful result of this decision is the breakdown of the controlled, prepackaged communication structure that infects accurate reporting. Now if we can only outlaw message training…

When your CEO decides to be a cowboy

What do you do when it is uncovered by the WSJ that in the recent past your CEO went into chat rooms under an alias and talked favorably about your company while attacking competitors (especially competitors your company is now attempting to acquire)? This is exactly the scenario Whole Foods finds itself in presently as founder and CEO John Mackey decided to do some online outreach of his own.

This may not be huge deal (since the posts stopped months before acquisition talks of Wild Oats began) except for Mackey has been attacking the SEC on his personal blog. Likely this has irked the SEC, which is why it is reported that the SEC has launched an informal probe of Mackey’s postings. For those not into Wall Street…this is not desirable.

How might this have been prevented? Disclosure. This is precisely why my firm has a policy that we must use our true identity with all message board posts as well as always mention the client you represent. Cumbersome…very much so. Limit the places that will accept your participation…definitely. However, this strategy is highly useful when the SEC comes calling.

Personally I think much of this crisis is a lot to do about nothing, but it has the potential of derailing a major acquisition. Never attack the SEC…

For disclosure purposes…I am probably the biggest Whole Foods supporter you are likely to meet (just a bit below John Mackey), so this post may have some bias.