​Jeff Kagan: Alternative Energy Growth Wave

Jeff Kagan  |

The growth wave which I have discussed in other industries is also playing a role in alternative energy. The growth wave always rises, crests, then falls. Having a good understanding of this is important for your success - whether you are an investor, worker or partner. Understanding this helps you select the right companies and technologies at the right time.

The bottom line goal is to select companies that are on the growth side of the wave. This is for every company, every technology in every industry. Companies are either on the growth side of the wave or they are cresting or they are on the falling side. You want to focus on companies on the growth side.

Growth Side of the Growth Wave

Let me explain what I mean by the growth wave. Let’s take a look at the wireless industry. First, Motorola (MSI) was on the growth side of the wave. They were there for decades. Then in the late 1990’s they crested and have fallen. Today, as we all know, Motorola is not the same company it once was.

That’s when Nokia (ADR) and Blackberry (BBRY) took over the leadership position. That lasted for the next decade until the Apple (AAPL) iPhone and Google (GOOG) Android entered the scene in 2007. Once that happened, both Nokia and Blackberry fell like a rock, just like Motorola. Today the Apple iPhone and Google Android wireless devices lead. So as always, the next question is simple… what’s coming next?

This growth wave affects every competitor, every technology and every industry. With that said, the energy industry has been going through several different growth waves in recent years. Each new wave has the potential to rewrite the competitive playing field. New companies can take the lead and often do for a period of time until the next wave sweeps over the industry and re-writes everything once again.

Secret to Success: Analyst Relations, PR and Media

So what exactly turns a company into the next industry leader? There are many factors, including a breakthrough technology or a new way of doing things. However, very successful companies typically also have a great public relations and marketing program, and effective industry analyst and media relations.

This means the executive management must understand the importance of each and be able to play to win. A company must have a new idea or technology. They must stir the pot. They must create the next new segment to lead in. And they must inform the marketplace of their leadership in this new segment before the marketplace joins in.

As an example, think about the wireless industry. Blackberry was considered number one in smartphones. They owned the segment. When Apple iPhone and Google Android jumped in, they were so different we called them super-smartphones. They didn’t even compete with Blackberry. They were on their own. They created their own new segment and they led that super-smartphone segment from the beginning. Then the marketplace caught on and joined the party.

The company must own the new space. If they are successful with the analyst and media community, this is how investors, customers and workers learn about you. This area is vital to success. That means using public relations, marketing and advertising to create a new position.

If you are going to be successful, you must have good industry analyst relations and media relations. These should be the first step. These are two separate areas, yet they are both crucial to success.

Look at Apple's Success and Get Inspired

And leaders don’t have to start out as large companies. Just think of Apple in the late 1990’s when they started this whole wave of growth. They were a very small company, just barely surviving. In fact, a few years earlier there was concern that the company might not even make it. Now look at Apple success and get inspired.

Winning at the industry analyst game means the analyst community thinks, talks and writes positively about your company. This leads to positive commentary. You want industry analysts see you on the growth side of the wave.

Then the media tells the world about you. The media can steer opinion about your company. That’s why effective analyst relations and media relations are both key to success. This is key.

Industry Analysts Get Calls from the Media

As an industry analyst I get calls from reporters looking for comment on stories they are writing. Sometimes the stories are about an industry, technology or competition. Other times the story is about a company or a person. However, it is important to understand that many in the media simply don’t have the deep understanding of the company or segment on their own.

That’s why they interview others who do have a better and deeper understanding. They often talk with the company making the news. They sometimes talk with a competitor to get the other side of the story. However, they always talk with an industry analyst to get an unbiased comment and appraisal. That’s why it’s important to work successfully with the analyst community before hand.

I can’t tell you how many times I have changed the direction or angle of a story during an interview with the media. The reporter calls me with a foregone conclusion in mind. Sometimes I agree. Other times I don’t. During the course of the interview I am able to enlighten them and often change the direction of the story.

Playing Active Role in Own Success

That’s why it is so important for you to play an active role in this vital area of your success. You can’t just leave this to chance. Many times the marketplace has the wrong idea and it must be steered back on track. You need to think about that and have a plan before hand.

You would be surprised how often this occurs. There are many companies out there today who get better coverage than they deserve. There are also many companies who get worse coverage than they deserve. However if you work to manage your companies perception you are always better off.

That’s the world we live in. It is imperfect, but we must still play to win. You must look for a great CEO and company thinking. You must also look for a company on the growth side of the wave. You must find a company who manages their own perception well in the marketplace.

A company that is written about in a positive sense by the media and analyst community. This is what every investor, worker and customer is looking for. This is an important recipe for success in the ever changing energy industry.

Equities.com columnist Jeff Kagan is a Wireless Analyst, Telecom Analyst, Industry Analyst and consultant. He shares thoughts on the changing industry, which he's been following for 25 years. He follows what's hot, what's not, why and what's coming next. Email him at jeff@jeffKAGAN.com.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer


Symbol Name Price Change % Volume
GOOG Alphabet Inc. 1,042.10 -19.80 -1.86 1,686,619 Trade
BBRY BB BlackBerry Limited n/a n/a n/a n/a
MSI:CA Morneau Shepell Inc. 25.52 -0.03 -0.12 113,229
AAPL Apple Inc. 165.48 -5.47 -3.20 40,703,710 Trade



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