AS MORE AND MORE investors begin to wade back into the equity markets, some investor-relations pros are trying to get their attention using techniques from the advertising world, ranging from intensive focus-group research to direct-mail pieces.

"The role of IR people traditionally has been to maintain a relationship with Wall Street," says Rob Swadosh, principal and co-founder of S2 Communications. "They haven't really been part of the creative-development channel."

The New York-based consultancy is among those that are trying to change that. S2 has created a system called Brandimension, which borrows techniques from ad-industry "account-planning" methodology to drill deeper than existing IR techniques into underlying investor motivations and behaviors. For example, S2 will explore the attributes of a client's "investment brand" compared with other companies not only in its business peer group but also matched against the brands of other companies in the client's "investment peer" group.

Not everybody thinks the approach is sound. "They're wasting money," charges Gary Miles, head of strategy and marketing in the New York office of PA Consulting, a management-advisory firm. "At the end of the day, [a stock's] brand really doesn't mean anything. You can only value cash flows that come out of activities and products. Then investors will understand exactly what it is you're trying to do as a company. Everything else is spin doctoring," he argues.

Still, plenty of companies are finding value in using advertising techniques for IR. For example, The Allied Defense Group Inc., a Vienna, Va.-based defense-technology firm, recently commissioned qualitative investor research to help the company assess its name identity and develop the most cost-effective IR strategy. Among other perceptions Allied executives want to correct is confusion about the company's business model, says a spokesperson. And Basking Ridge, N.J.-based telecom firm Avaya Inc. direct markets software to investors that automatically brings financial data to their desktops.

Efforts that borrow from advertising might prove particularly effective with individual investors, especially with consumers and other constituencies that already may have a relationship with a company. "These people also are investors who are putting their money back to work, and companies want some of that capital allocated to them," says Moira Conlon, executive vice president of FRB/Weber Shandwick, an investor- and public-relations firm.

HELP WANTED

One hint of optimism on growth: 41% of midsize companies say they will increase hiring in the next six months, reports Grant Thornton.

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