Asset managers have shown a “giant leap forward” in their “adoption and implementation” of social media since last year, a new report by Cerulli Associates has found.
In 2010, while 70% of asset managers remained on the social media “sidelines,” today, Cerulli says, “nearly as many are actively employing social media in their marketing efforts and one-quarter are in the exploratory phase.” The majority of managers (63%) that had been in the “exploratory phase” in 2010 are now using social media, Cerulli found, while 13% of asset managers now see social media as a key element in their marketing strategy. Six percent of asset managers, however, prefer to remain on the sidelines of social media use, the report said.
The report, “How Are Firms Steering Social Media to Optimize Opportunities and Mitigate Risks?,” which includes findings from a proprietary study performed by Cerulli in conjuction with NICSA, found that many managers fail to see a meaningful “first movers’ advantage” and are deliberately venturing slowly into social media in order to glean best practices from other managers’ experiences. That being said, Cerulli adds that as “they witness social media use skyrocket, most managers are increasingly unwilling to postpone participation.”
Because of the meteoric rise in social media use—Cerulli notes that Twitter was founded in 2007 and is estimated to have 200 million users today—“managers are scrambling to operationalize social media strategies,” the report states.
When managers do incorporate social media into communications strategies, most turn to Twitter, the report found. Of managers surveyed by Cerulli, 56% are using Twitter, compared to only 38% using Facebook and/or LinkedIn. “Twitter’s initial attractiveness stems, in part, from its ease of use,” Cerulli says. “Twitter restricts individual tweets to 140 characters or less—this microblog format means that copywriters and compliance examiners are not charged with creating or reviewing multiple pages of text—minimizing the impact on already burdened personnel.”
Most managers, the report found, are putting themselves in “the drivers’ seat” so they can their steer social media use. Cerulli identifies four levels of commitment to social media use among asset managers: committed adopters; guarded adopters; sidelined supporters; and abstainers.
Cerulli calls committed adopters “a small, but devoted, group,” who tend to be large asset managers that are focused on direct-to-investor distribution. “Committed adopters were the first to embrace social media and are its heaviest users. For these firms, social media is typically a key part of their marketing strategy,” Cerulli says.