J.C. Penney, to the frustration of some analysts, emailed its news distribution list today to say it will start releasing some company information exclusively through its @jcpnews Twitter account.
The struggling department-store chain said it will use the account "to distribute material information about the company" and "important announcements such as leadership changes, new brand partnerships, shopping trends, marketing campaigns, corporate initiatives and more." In an email, spokeswoman Daphne Avila told BuzzFeed that sometimes, J.C. Penney "may tweet something briefly before or after putting it on the wire," while other times, announcements deemed "not press release-worthy" may exist solely on the Twitter feed.
Avila on Friday said that J.C. Penney, at this time, will continue to announce material information through press releases. The information that will be exclusive to Twitter or announced there first will include, say, links to new marketing campaign materials a day or two before they're available to the general public, or a welcome to a lower-level new hire.
The idea that some news from the beleaguered company may only go through Twitter rankled some analysts, considering the volatility of the stock. In the past, even very small announcements from the retailer have moved its shares. J.C. Penney's stock has plummeted 63% in the past year as it works to recover from a management turnover and strategic mishaps, and it's heavily-shorted.
"I watch more than 100 retailers and have alerts set on my screen for breaking news," said Rick Snyder, an analyst at Maxim Group, who has a hold rating on the shares. "I usually check Twitter several times a day but watch my screens constantly. It will be a mess if they break news only on Twitter."
J.C. Penney, for its part, "just wanted the flexibility to provide our media followers on @jcpnews with brief company updates without going through the formality and time-consuming requirements of a press release," Avila told BuzzFeed on Thursday. "Twitter is simply an easy platform for doing so."
The retailer gets an unusually high number of mentions on Twitter through its $JCP "cashtag" — its ticker symbol, preceded by a dollar sign — frequently triggering "social velocity alerts" on the Bloomberg terminal. StockTwits, which describes itself as a real-time social network for investors and traders, said JCP was one of the 20 most popular tickers in 2013, with mentions increasing dramatically as the stock price declined this fall. J.C. Penney has had to take to Twitter to fend off rumors on the platform about its business in the past, Bloomberg News noted in October.
The Securities and Exchange Commission said in April that companies can use social media outlets like Facebook and Twitter to announce key information in compliance with fair disclosure rules "so long as investors have been alerted about which social media will be used to disseminate such information." Twitter, which went public in November, used its own platform to share updates and regulatory filings leading up to the listing. Still, it's not yet a widespread practice for companies to issue material information exclusively on the platform.
Update - Jan. 17, 11:13 a.m. ET: This update includes an additional comment from J.C. Penney today in the third paragraph, saying that the retailer has no plans at this time to tweet "material information" exclusively or first through the Twitter account.
StockTwits data showing a high number of messages about J.C. Penney as the stock price fell.
Sapna Maheshwari is a business reporter for BuzzFeed News and is based in New York. Maheshwari reports on retail and e-commerce.
Contact Sapna Maheshwari at email@example.com.
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