Avoid the Common Mistake of Not Knowing “WIIFT”

This post covers this element(s) of GAMMA PI: #1. Generate Informed Insights, #5. Acquire Buy-Side Votes (Sell-Side Only)
Win Over Information Sources

Almost every time I begin sharing best practices for seeking unique information sources (for generating informed insights), one of the analysts in the room asks, “Why would someone out in the industry want to talk to me?”

Before I provide my response to this question in the table below, I should probably highlight that this was the method I used to build a contact list of over 10,000 industry sources.  I didn’t build this list based on superior intelligence, good looks (which I don’t have) or paying for sources.  Instead, I followed a basic skill taught in every salesmanship class: understanding the “WIIFT” principle.  If you can determine “what’s in it for them?” you can take the first step in positively influencing another person, which is critical in getting good information sources (there are other elements to influencing others which are discussed in this post).

Most analysts don’t realize they have a tremendous amount of value to offer information sources, which when used correctly, can lead to insights for the best stock calls

The table below contains the eight most likely reasons someone will want to speak to you (the most relevant WIIFT).  As an equity research analyst spending 50-70 hours a week studying the same industry(ies) where an information source earns a living, gives you a tremendous amount of non-monetary currency to spend on winning over information sources.  If you find this list helpful but are not sure where to start in finding information sources, refer to this post.

8 Ways to Fulfill an Information Source’s Needs (WIIFT)

Their Primary Need (WIIFT)Their Specific Need (WIIFT)Fulfill Their Needs
InformationAccess to insights from senior management of companies within the industry
  • Provide them insights after participating in calls or meetings with senior management of the companies in your universe
  • Forward key quotes from a quarterly call transcript or press release when relevant
InformationUnderstanding of their company and its stock price
  • Provide an explanation about their company’s stock valuation relative to the past and their peers
  • Provide an update on days when their stock is volatile or company is in the news
InformationUnderstanding of the industry trends or their company’s competitors
  • Forward insights you come across when researching (including blogs, journals, webcasts, etc.):
    • Major industry developments
    • Their company’s competitors
  • Provide access to your research (if allowed by your firm)
  • Explain the critical factors on the minds of investors
  • Forward them information about relevant industry events they may want to attend
InformationAccess to other experts
  • Introduce them to your other relevant information sources
  • Invite more than one information contact to an event as an opportunity to meet one another
  • Forward them information about relevant industry events they may want to attend
EmotionalTo be recognized as an industry thought leader
  • Forward requests from the press to them that you receive
  • Recommend them to speak at conferences or private dinners you host (in conjunction with a conference or seminar where you can gather a group of experts)
  • In your post-interview thank you email, mention how you intend to give them recognition with others as the industry thought-leader
EmotionalEgo boost (some overlap with WIIFT directly above)
  • Explain to the individual why he/she is considered the best expert to speak with and during the interview, frequently note how appreciative you are to be getting such insightful information from an industry guru
  • In your post-interview thank you email, acknowledge their talents and how they are one of the few people in the industry that is so knowledgeable
EmotionalDesire to honor request from colleague or friend who referred you to the information source
  • Often, information sources will be flattered when their colleagues or friends referred you to them. If this is the case, let the information source know you will thank that colleague/friend because the introduction was so worthwhile
EmotionalDevelop more friendships within the industry
  • Dedicate time with them during industry social events such as conference and annual award dinners
  • Take to lunch or dinner when you’re in the same town
  • In your post-interview thank you email, mention how you appreciate making the personal connection

Respond with Follow-Up

The WIIFT table above helps to win over information sources (which is part of our PRACTICE™ framework).  In our ASPIRE™ framework for generating informed insights, the “R” is for “Respond with Follow-up” which emphasizes the importance of following up after meeting an information source to ensure you are meeting that need:

  • Taking from our PRACTICE™ framework for influencing, a great way to cultivate a long-term information source is to ensure you have satisfied the “what’s in it for them” (WIIFT) after the interview. This may include sending them information they’ve requested, which will in turn build trust and give them a sense they should reciprocate by sending you information in the future. If they’ve asked for something during the interview, follow up immediately (don’t wait to do this or it’s not likely to get done).
  • Immediately after an interview with an information source:
    • If you find value in the exchange, immediately add the interviewee’s details to your contact list because if you don’t do it then, it won’t get done and you won’t have their details when you need insights required for a big stock call
    • Create follow-up reminders for important activities such as such as telling firm colleagues or valuable industry contacts about insights you learned that may impact their companies
  • In short, treat them like you would a client, because that’s what they are…they’re not paying you a fee like a typical client but they’re giving you valuable insights. Routinely, proactively reach out to your most insightful contacts to see how you can fulfill their needs, similar to the way someone tends to a garden to yield a harvest. If the relationship simply becomes you calling for information, it will likely die on the vine

I hope you use the best practices above to help win over new information sources.  If you should hesitate to reach out to an information source because you think this might not work, recall the best movie endings are those where the main character leaves his or her comfort zone, often discovering they have a lot more to offer than they thought.

This Best Practice Bulletin™ targets #1. Generate Informed Insights of GAMMA PI™, within our Pathway to Success Framework.  I’m also going to classify it under the category #5. Acquire Buy-Side Votes (Sell-Side Only) because you can modify some of these to help win over new clients.

Let me know if this Best Practices Bulletin™ helps and how I can improve upon this best practice. If you’re interested in exploring this topic further, AnalystSolutions provides equity research training with a specialized workshop to help Generate Differentiated Insights Through Better Discovery, Questioning, and Influencing.

Improve you or your team’s stock picking and communication skills with our equity research analyst training tools, which includes workshops such as the one above, as well as our GAMMA PI™ assessment and one-on-one coaching.  Also, consider ordering the book that inspired the founding of AnalystSolutions and the Best Practices Bulletin: Best Practices for Equity Research Analysts.

©AnalystSolutions LLP All rights reserved. James J. Valentine, CFA is author of Best Practices for Equity Research Analysts, founder of AnalystSolutions and was a top-ranked equity research analyst for ten consecutive years

AnalystSolutions QRC, Information Sources Pros and Cons v2.7P

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