press release

n.
An announcement of an event, performance, or other newsworthy item that is issued to the press.

News that is sent out or released by the company making the news. If it's an earnings press release, the release will discuss the financial results of the company for the recently completed quarter and may provide comments from management. Press releases often list valuable contact information that can assist you in your research, such as the company's web address, information contacts and address information.

Investopedia Says:
Remember that press releases are written by the companies, not by a reporter, so they can be full of company bias. Often, as you search online news databases, it may be difficult to distinguish between a press release and a news story written by a journalist. The best way to distinguish the two is by looking closely at the first couple words of the story, which is where the source of the story is usually identified. If the source is identified as "BusinessWire" or "PR Newswire" then it is a press release issued by a company.

Related Links:
Here we explore why the media focuses on certain earnings manipulation cases in post-Enron Wall Street. A Case Study: Earnings Manipulation And The Role Of The Media
Learn how this key metric is calculated and how it is used to judge market performance. Earnings Forecasts: A Primer

Press releases—also known as news releases—are brief, printed statements that outline the major facts of a news story in journalistic style. As part of its overall public relations effort, a small business may need to prepare press releases in order to disseminate new information about its products, services, operations, or other activities. A steady flow of news helps to make a small business more visible to the public and creates favorable interest in its activities.

In his book Public Relations for the Entrepreneur and the Growing Business, Norman Soderberg lists several possible types of news stories that a small business could generate. For example, a small business might announce the promotion, transfer, retirement, or hiring of personnel, or the negotiation of a new labor contract. Building new facilities, planning a major expansion, installing new equipment, or offering a new product are other newsworthy events that might occur in a small business. In addition, human interest stories might arise from the unusual hobbies or avocations of employees, the success of company-sponsored sports teams or events, or the company's participation in charity or community activities. If a small business received an award or a visit from a celebrity, these events might provide impetus for a news story as well. In general, a newsworthy story should be timely, of general or human interest, and somewhat unusual.

Preparing a News Release

In order to attract the attention of the media to anything but a vitally important story, a small business will probably have to prepare and send out a news release. Ideally, the news release will generate enough interest that the media will choose to cover the story themselves. A news release may also be useful as a handout to provide basic information to reporters who come to cover a story.

Soderberg explains that a well-written news release should include "five Ws and an H": who, what, when, where, why, and how. The lead, or first few lines of the news release, should address all of these questions, though not necessarily all in one sentence. The remainder of the news release should provide supporting information—such as facts and figures or quotes from people involved—in most-important to least-important order. Overall, a news release should be crisp and concise, never exceeding two pages in length, and similar to a newspaper article in content and style. It is important that a small business owner find someone to write the news release who has a good command of language, grammar, and punctuation.

News releases should be typed on company letterhead and include the name and address of the company, its trademark or logo, the name and telephone number of a contact person (usually the small business owner, even if the job of preparing the news release is delegated to another person), the date, and the words "News Release." The importance and scope of the story determines where it should be sent. In most cases, it would be appropriate to send it to the business editors of the local print media. Sometimes sending it to local radio and television contacts might be appropriate as well. A small business can create a mailing list of relevant addresses, which can be found in media and trade journals and some reference books, to simplify the process. Some publications have begun accepting press releases online. But small business owners should avoid the temptation to follow up a news release with a telephone call.

Press Releases in the Age of Electronic Information

The common press release has undergone several significant changes in recent years as the Internet has revolutionized the way news is delivered. The wide availability of online information allows average investors to receive business news at the same time as analysts and news services. While some investors have been able to use this instantaneous information to their advantage, it has also opened the door for some dubious practices. For example, many companies have been victimized by fake press releases issued by disgruntled former employees, unscrupulous investors, or competitors. Such "news" is usually intended to cause harm to the targeted company by convincing investors to sell its stock.

On the other hand, some companies have taken advantage of the technology to issue press releases of debatable merit, apparently with the intention of increasing their stock prices. "Once a relatively mundane communications device, a press release now has the might to dramatically drive the price of a stock," according to Business Week. "As a result, more companies are designing press releases with that goal in mind. But it's not just edgy or pushing-the-truth headlines from lesser-known companies that are designed to spike share prices. Stock analysts say established companies are also playing fast and loose with press-release language, especially those involving earnings reports. They may exclude entire unprofitable subsidiaries, or leave out key information—such as certain losses—in order to appear rosy to investors."

Some companies release information prematurely—for example, they might announce a planned merger or joint venture before the deal is completed—while others bombard the information highway with daily press releases in an attempt to keep their stocks in the minds of analysts and investors. "Apparently, some high-tech companies use press releases not only to inform the trade press but also to impress Wall Street analysts and business reporters and—through them—to impress investors who have no other way to get news because they don't read the trade press," Mark Ferelli noted in Computer Technology Review. In any case, the Securities and Exchange Commission (SEC) has begun taking notice of business news releases on the Internet. Experts recommend that investors look beyond companies' paid public relations efforts and review their filings with the SEC before making investment decisions.

Further Reading:

"Beware the Press Release." Business Week. April 24, 2000.

Dobkin, Jeffrey. "Getting Your Press Release into Print." Direct Marketing. August 1998.

Ferelli, Mark, and Hal Glatzer. "The Power of the Press Release: For Better or Worse …Much Worse." Computer Technology Review. September 2000.

Hall, Thomas C. "Press Release Snafu Puts Firms on Alert." Business Journal. September 1, 2000.

Pelham, Fran. "The Triple Crown of Public Relations: Pitch Letter, News Release, Feature Article." Public Relations Quarterly. Spring 2000.

Ryan, Michael. "Models Help Writers Produce Publishable Releases." Public Relations Quarterly. Summer 1995.

Saltz, Linda Citroen. "How to Get Your News Releases Published." Journal of Accountancy. November 1996.

Soderberg, Norman R. Public Relations for the Entrepreneur and the Growing Business. Probus, 1986.

Wilcox, Dennis L., and Lawrence W. Nolte. Public Relations Writing and Media Techniques. 3d ed. Addison Wesley, 1997.

See also: Public Relations

Note: click on a word meaning below to see its connections and related words.

The noun has one meaning:

Meaning #1: an announcement distributed to members of the press in order to supplement or replace an oral presentation
  Synonyms: handout, release

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