The cost of the entire program was exceedingly modest; there was no special appropriation for paid space or radio time. Space was paid for from the existing budget allocated to public relations advertising. Radio commercials relative to the stockholders' meetings were substituted for commercials carried on the company's regular programs.
The original cost of the special display was $1,750. Since the exhibit was of a permanent nature and could be used for several years with minor changes, it could be reasonably written off over a period of time.
Direct costs incidental to the meetings hall rental, refreshments, and stockholder letters, etc., totaled $525.
There were a number of concrete results attributable to the program.
- Today common stock ownership in Wisconsin represents well over 50 per cent of the total shares outstanding. At last count there was a total of 16,159 Wisconsin stockholders holding 58.8 per cent of the company's common stock.
- New financing was successfully carried out in 1951, 1952, and 1955, some of it at the lowest cost in the history of the company.
- Another financing was carried out in 1995. Common stockholders subscribed to 73 per cent of the total common stock offering while preferred stockholders subscribed to 70 per cent of a new offering of 4.40 per cent preferred stock.
- The company has a force of almost 29,000 local stockholders to whom it can disseminate information about the company and the industry. These individuals, in turn, feel free to advise local management personnel of any developments affecting the interests of the company, thus providing a two way channel of communication.
Charles K. Preston Secretary, Bell & Howell Co.
Making potential buyers aware of a new product is fast becoming an exact science. Some companies’ stage elaborately planned dealer meetings in which the new line is shown in all its glory and to best advantage. When warranted there is, of course, a press conference to make sure that the members of the fourth estate know all about the new product, its features, price, and availability. Advertising and sales promotion experts lie sleepless nights trying to find ways and means to rivet the public eye on the newcomer. Then comes national advertising in magazines, newspapers and radio. Direct mailers, point of purchase pieces, give away, and special promotions are all designed to attract the attention of the potential buyer.
But what of the share owner who puts up the wherewithal to make the undertaking possible in the first place? Undoubtedly, he will read about the new product somewhere. He may have to wait for the next annual report or an interim mailing to share owners, but since his company is making the product, all too often we assume the loyal, long suffering share owner is going to be an enthusiastic salesman of the product and perhaps even a user of it. But is he really?
In the "rush to market," the share owner may not be getting trampled underfoot, but sometimes he doesn't get the kind of attention he deserves.
Charles K. Preston, Jr., joined the public relations department of Bell 6 Howell Company in 19. /9. He was appointed director of public relations in J 950, and in 1955 was elected corporate secretary, retaining responsibility for the company's public relations program and legal activities. He is a graduate of the University of Illinois, the Chicago Kent College of Law, and a member of the Illinois Bar. Prior to joining Bell 6 Howell, he worked for two years in the Trust Division of the Chicago Title and Trust Company. A member of the Chicago Bar Association and Public Relations Society of America, Preston is also active in Community Fund and Boys Club work.
So it was when Bell & Howell introduced microfilm to the public. It took us a while to get around to the share owner, but get around to him we did.
When talking over plans for the annual meeting, someone suggested the idea of a "capsulized" version of our annual report to hand to share owners. Somehow there was a cross fertilization of the idea of a "capsule" and "microfilm" and a very interesting little object resulted.
We took a copy of the annual report measuring BY2 by 11 inches with some 24 pages, including covers. With our new microfilm recorder we squeezed all of the data on a little strip of 16mm film 3M inch long which was carefully inserted in a capsule no larger than a vitamin pill. The capsule at the annual meeting dramatized for the share owner the potentialities of microfilm as a space saving, cost saving device. Actually our share owners had fun comparing pages in the report with the minute images on the strip of film.
Something we never counted on was the interest of the press people who attended our annual meeting in Chicago that year. One of the major Chicago dailies even went to the trouble of taking a photograph of the capsule, and ran it on the financial page.
The wire services became interested and treated the story in a light hearted way. Suddenly our little capsule had made "news" nationally.
More and more attention is being paid to the importance of keeping the share owner informed about the current operations of the business. There are, of course, public relations firms which specialize in share owner and financial relations.
The share owner is certainly entitled to the best attention that the management of his company can give him. Many companies get off on the right foot by sending a welcoming letter to new share owners. This may include a copy of the latest annual report and proxy statement so that the share owner is brought up to date on the affairs of the corporation.
In many of the larger companies, share owners don't go to the annual meeting; the annual meeting comes to them. Take General Foods, for example. Their top executives travel all over the country meeting share owners on their home grounds, bringing with them a highly effective film presentation of the accomplishments of the past year and the outlook for the future.
Many companies send out interim reports to share owners, reviewing sales and earnings trends and the future outlook. Sometimes there are special letters from the chief executive on matters of national importance. Direct mailers on new products go with dividend checks and, once in a while, a lucky share owner receives a sample of a new product, unit costs permitting.
If the share owner cannot attend the annual meeting, he may get a pretty carefully written resume. In almost every case his questioning letters will be promptly and fully answered by the chief executive of the company or the officer charged with the responsibility of handling share owner relations.
We cannot forget the ultimate influence on the share owner of the financial analyst whose responsibility it is to keep his employer (usually a brokerage firm or investment counseling service) advised of the various things going on in his specialized segment of the business world. Many companies encourage visits by security analysts. This kind of face to face contact enables the analyst to provide a far more penetrating evaluation of the company than he could ever procure by studying just the written word.
It is not always feasible to bring the analyst to the company, in which case the chief executive officer oftentimes visits analyst groups in different parts of the country at their invitation, subjecting himself in many cases to their questions.
share owners are also avid readers of the financial pages of newspapers, magazines, and special investment services. Getting the company story to these people is extremely important and a most worthwhile continuing task. After all, one financial editor in a major metropolitan daily newspaper may talk each day to some half million readers. His views, which have stood the test of time, are given great weight. And so it is important to see that the financial press is given prompt, full, and complete information about major company events, sales and earnings trends, new products, personnel changes, plant acquisitions, diversification efforts, building programs, and an insight into the long range thinking and planning.
The crucial question: does all this costly effort really make sense from the company's standpoint? Undoubtedly it does, or few companies would continue programs of this type beyond the next meeting of their budget boards. There is no doubt that an informed, interested financial community is good for the company. A sound program can often influence the thinking of potential investors. It helps build the right kind of a relationship between the share owner, the financial community, and the company.
Launching such a huge project required money big money because a virtually new, bigger, more modern, and more efficient mill had to be constructed within the carcass of the old. Detroit Steel had to spend about $65,000,000 to do this ambitious modernization over a five year span. This meant coming into the money market for long term borrowing for a company which, notwithstanding its fine record, was practically unknown in the financial community where mortgage bonds are underwritten, marketed, and purchased.