Social Media in Financial Services: The Keys to Success. Indeed, 85 percent of financial advisors are already using social media for business, according to the 2016 Putnam Advisor Social Media Survey. And Hootsuite can provide industry-specific training that not only increases advisor adoption, but provides the foundation for FINRA and SEC compliance requirements. Educating employees means walking them through your organization’s formal social media policies and crisis communication plans, how to use secure social media tools, and how to spot security risks like unsafe links or accounts. For example, Hootsuite’s double approval system prevents mistakenly posting to the wrong account, reducing the risk of employee error. The opportunities for social media in financial services Having your bases covered when it comes to compliance and security on social media means you can explore the opportunities that these platforms offer without having to worry as much about potential repercussions. Here are a few of the key opportunities I see for financial services firms on social media: Uncover money in motion events through listening Companies that are doing well on social media are realizing the power of listening. Empower executives and employees on social Many organizations have moved beyond using social media as merely a communication channel to become full-fledged social enterprises. Again, education is key. For example, let’s say you go on LinkedIn and connect with a client.
More than 5 million high net worth people in North America are
using social media to assist with financial decision-making,
according to LinkedIn. For financial advisors, social media
represents a direct channel to their current and potential clients
at a crucial time in their financial journeys.
Indeed, 85 percent of financial advisors are already using
social media for business, according to the 2016
Putnam Advisor Social Media Survey. Of these “social advisors,”
80 percent attribute gaining new clients to social media—for a
median asset gain of $1.9 million.
As the global industry principal of financial services for
Hootsuite, I continue to see two major challenges in particular
that organizations in the financial services industry must overcome
in order to use social media to its full potential: adhering to
compliance requirements and protecting the safety of their firm and
customers against threats. Here’s how to address those
challenges—and how to capitalize on the opportunities that lay
beyond them.
The challenges of social media in financial services
(and how to address them)
Challenge: Regulatory compliance
Compliance has traditionally been an obstacle for social media
adoption in financial services. However, technology and education
have both proven to be instrumental in overcoming this barrier.
The U.S. Security Exchange Commission (SEC) and the Financial
Industry Regulatory Authority (FINRA) guidelines categorize social
media content into two buckets: static content and interactive
content.
When it comes to static content, it is considered the same as an
advertisement and requires compliance pre-approval.
Interactive content, on the other hand, is considered the same
as a presentation in front of a live group of investors.
Interactive content does not require pre-approval, but it does
require archiving and post-review.
While each company’s compliance team ultimately determines what
they consider to be static versus interactive, you’ll find that
more often than not, the majority of social media posts and
discussions will fall into the interactive category. But be sure to
check with your compliance department for specific firm rules.
Solution: Stay compliant on social media by using an
automated pre-publishing screening tool
With the advancement of technology, more and more firms are
moving from pre-review to post-review for the majority of social
media content. Tools like Hootsuite, in conjunction with our
compliance partners, are able to provide pre-publishing guardrails
such as flagging and rerouting posts containing words such as
“guarantee” or “free” before posts even go live. And Hootsuite can
provide industry-specific
training that not only increases advisor adoption, but provides
the foundation for FINRA and SEC compliance requirements.
Challenge: Security threats
Hackers, targeted phishing, social engineering, account
takeovers, piracy, fraud—being active on social media comes with
just as many risks for businesses as it does opportunities. And in
an industry such as financial services where wealth transfer is
regularly occurring, these risks can have especially serious and
far-reaching consequences.
According to IBM, 60 percent…
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