Annual Reports Online

The Good, the Bad and the Ugly

by Jennifer Harrison

"Annual reports lend themselves well to a web environment by nature of the data and graphics," says communication manager, Chris Roberts of Eli Lilly. But the paramount issue "is that the message be strong, the message be clear. Then it's a matter of execution to put it on the web site," observes Roberts.

Ameritech's Director of Financial Public Relations, George Stenitzer suggests companies "make sure the investors you want to reach are online." Ameritech undertook research in this area and found that 100,000 shareholders of their 1 million shareholder base had access to the Internet. The Ameritech general web site has approximately 9,000 daily visitors, but doesn't currently track vistors to its annual report. Ameritech's site allows viewers to download eleven years of financial results in popular worksheet formats.

Eli Lilly tracks visitors or "hits" to its annual report pages. Approximately 4,200 annual report pages were viewed in November 1995, by 650 unique Internet visitors. The average annual report visitor is looking at 6.5 pages of material.

While there are numerous annual reports online, it's clear there are few companies who've mastered the medium. The reason is simple, Internet media is new to the commercial realm and technology used to access it is evolving every online minute. For example, the Netscape browser introduced in the middle of 1995 is already being used by 70 percent of web surfers, says John Ayers, a web service provider with Potomac Interactive Corp., Washington, D.C.

The wide variety of web browsers used on the cyber trail creates an execution challenge for those creating web pages. The browser issue is especially relevant because of the financial data presented. Some browsers such as Netscape and Explorer have the ability to view financial tables much as you would see them in the print version of the annual report.

But other browsers (without table or HTML 3.0 capabilities) run into a data pile-up that resembles a statistical train wreck when they try to view the new generation of tables. Commercial providers such as AOL and CompuServe provide subscribers with browsers that are archaic by today's standards, explains Ron Gruner of Direct Report Corp., a firm that specializes in online investor relations.

One solution to the browser dilemma is to present financial data in two formats. For example, to view the Consolidated Income Statement of "Online Is Us" you click on the Income Statement from an Annual Report menu. This takes you to another page where you select how you want to view the data based on the type of browser you're using. If you're using an older browser you view the financial data in a text mode. If you're using the new generation of browsers, the financial data is presented in an attractive table that can include borders and other formatting.

Before you saddle-up your online annual report and head for the i-way, consider these tips gleaned from seasoned cyber guides and an online review of annual reports.

- "Start with an attractive annual report," says Roberts of Eli Lilly. The online version of your report can be no better than the art and content of your print version.

- "The key word is browse," comments John Ayers. Don't overload the document with too many graphics, this increases the amount of time it takes the reader to download and view information. On the other hand, use enough graphic material to create an attractive and dynamic site.

- "Don't allow your annual report to look like a 'data dump,'" warns Ayers. Either invest the resources to make the annual report attractive and easy to navigate or don't put the report online.

- Make sure it's easy to find your company's financial or investor information from your homepage. Don't bury this financial information in layers of "About Us." Ideally, make a direct link from your homepage to investor data.

- Consider using hypertext links from the Chairman's letter or an overview section to more specific information on divisions, product lines or financial statements, suggests Ron Gruner of Direct Report.

- If you use a vendor to design your online annual report, "make sure you have clearly specified the online design and have frequent reviews," suggests Dave Crumbacher, systems analyst with Eli Lilly. "There are many ways to design a web document, the vendor may use a different design style than you if not specifically directed."

- Beware of using financial graphs that are unreadable due to resizing or resolution of the monitor. Don't include graphs and charts that are unreadable on a standard 13" monitor.

- Make it easy for the viewer to request the print version of your report. Have an e-mail link in your financial section.

- Consider a link to SEC's EDGAR database where investors and analysts can get the most current information about your company's earnings. Update your site with earnings announcements and quarterly reports.

- "Keep your site fresh and update it often," adds Ameritech's George Stenitzer. The online community expects to see current information.#

Appearing April 15, 1996, Webmaster Report
Copyright 1996.  All rights reserved by Jennifer Harrison.