Social-networking experts say that Morgan Stanley Smith Barney (MS) made the right move last week by announcing that it would let 600 advisors access LinkedIn and partially access Twitter in late June. They expect more moves on behalf of Morgan Stanley and the other wirehouse firms over the next year or so, but also caution the firms and their FAs to not abandon their conservative approach to the new media.
“It’s really a double challenge,” said Stacey Haefele (left), CEO of HNW, a New York-based financial-services marketing firm, in an interview with AdvisorOne. “How do you enable advisors to what do their best with high-net-worth clients and prospects? And [how do you work with] media that are dangerous, that can act as accelerants or amplifiers for messages?”
For Haefele, “It’s best to have the guardrails in place. Thus, Morgan Stanley and others are saying, ‘Let’s get going with some controls at first and then we can get looser or tighter depending on demand and users’ preferences.” Also, she adds, “It’s best for broker-dealers and other industry players to be part of the action now and have a precedent in place before there’s more regulation.”
Other experts agree. “FINRA approved some use of social media two years ago, and we see more guidance coming in about 12 months,” said Scott Brown, associate director of MarketCounsel, an Englewood, N.J.-based firm that supports wirehouse advisors’ transition to independence.
The wirehouses are expected to develop more social-media policies once this guidance develops, Brown says. “Meanwhile, they are trying to move forward and do their best to work within existing rules. This [Morgan Stanley move] is a big step,” he said in an interview. “We will see how the others follow suit. It’s a hot issue.”
Avoiding ‘An Ashton’
While social media and their growing use online are exciting in many ways, they've got their down sides. Thus, experts say, advisors shouldn’t take leave of their senses when using it.
When it comes to what advisors should tweet or blog about, “Stick to what you do best and keep it close to what you do,” said Haefele. “It’s tempting to go ‘Ashton Kutcher’ on this and share what you’re having for lunch. But there’s no meaning to this. Focus on what the people you are in contact with care about … or your clients will tune or filter you out.”