September 7, 2011

Financial Services Firms Use Social Media to Build Targeted Online Presence

Many firms maintain multiple accounts on Facebook, Twitter

A report from Corporate Insight released Wednesday found that not only are financial services firms using Facebook and Twitter, but they are maintaining multiple profiles on those networks.

Twitter is the preferred social network; the study found 45% of firms had two or more profiles on Twitter while 38% had two or more profiles on Facebook. The primary account typically features general information and news about a company, while additional accounts provide more targeted information or are used to personally interact with followers.

Alan Maginn, Senior Analyst, Corporate Insight“By using multiple Facebook pages and Twitter profiles, firms can offer content to their fans and followers that is better suited to their needs or interests,” Alan Maginn, senior analyst at Corporate Insight, said in a statement. “This can increase the impact of a firm’s communication and improve relationships with core constituencies.”

Secondary profiles also provide an avenue for recruiting at firms like Ameriprise, KeyBank and Scottrade, Corporate Insight found, which use their Facebook pages to post information about internships and career opportunities. Other uses for secondary profiles include promoting specific products and services, and highlighting charity or social campaigns.

Some firms have turned to Twitter as a helpdesk, using the site as a customer service channel. Bank of America and Wells Fargo were among the first to use Twitter this way.

A not-yet-widespread use for Twitter is as a way to communicate with advisors, the study found, although several large firms are leading that trend: Charles Schwab, Morgan Stanley Smith Barney, Raymond James and Vanguard.

The study found that maintaining multiple profiles doesn’t dilute a company’s online presence. With five pages, American Express and Capital One had the most Facebook pages; of those 10 pages, six rank among the top pages hosted by a financial services firm based on the number of fans. Bank of America had the most Twitter profiles, with six accounts, three of which rank among the top 20 financial services industry profiles based on number of followers.

As more firms adopt social media strategies and the compliance concerns that come with them, companies that capture and archive activity on social networks become more valuable. Erado announced on Wednesday that it has partnered with seven broker-dealers to provide compliance services.

  • Liberty Partners Financial Services LLC
  • Jeffrey Matthews Financial Group LLC
  • Protected Investors of America, Inc.
  • LaSalle Street Securities LLC
  • Financial Management Network Inc.
  • Summit Brokerage Services Inc.
  • JW Cole Financial Inc.

“The financial services industry is recognizing the power of social media, and we are excited to be working with these broker-dealers,” Craig Brauff, CEO of Erado, said in a statement. The company has already secured partnerships with other big firms like LPL FinancialCommonwealth and National Planning Holdings.

Maginn of Corporate Insight noted that the most important thing for firms to do is to adopt policies before using social media.

“As long as they have policies in place, the latest guidance from FINRA indicates that they’re not going to go after them,” Maginn told AdvisorOne on Wednesday.

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