{"id":3140,"date":"2012-06-08T14:33:24","date_gmt":"2012-06-08T14:33:24","guid":{"rendered":"https:\/\/thesocialelement.agency\/us\/?p=3140"},"modified":"2023-08-12T20:13:59","modified_gmt":"2023-08-12T20:13:59","slug":"retail-investment-banks-using-social-media-case-studies","status":"publish","type":"post","link":"https:\/\/thesocialelement.agency\/us\/retail-investment-banks-using-social-media-case-studies","title":{"rendered":"How Retail and Investment Banks are Using Social Media – Case Studies"},"content":{"rendered":"

The past couple of months have seen an increased acknowledgement of the role social media has to play in the development of the financial services sector<\/strong>. Industry forums like Finextra’s Live Social Media Days<\/a> held in London and New York and the inaugural LinkedIn Financial Services Summit in New York are capturing the zeitgeist of financial social media<\/a>.<\/p>\n

If you’d prefer a digest, here are a few best practice rules<\/a> to follow along the way. To see how this is playing out in reality, here’s a look at how retail and investment banks are using social media and see how they are adapting themselves to cope with the challenges of social media within their legislative framework.<\/p>\n

The guidance in the US is far more clear-cut than in the UK<\/strong><\/h4>\n

In the US, the Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) want advisers participating in social media sites to keep and store detailed records of their communications (up to five years for advisers participating in social media sites, with three years in a readily available format), and content posted on social media to be vetted by regulators and internal compliance departments.<\/p>\n

Firms must also be careful about distinguishing what constitutes a recommendation and what constitutes research. In the UK, the 2010 FSA guidelines on ‘new media’<\/a> assume that the main use of social media will be as another marketing channel, rather than a medium of consumer or peer interaction, and guidance as yet is not so clear.<\/p>\n

An update from the regulator’s Mortgage Market Review said in 2011 that it was “perfectly possible” for mortgage advice to be offered via social media sites, texts and instant messaging on mobile phones, adding the proviso only that firms who offer advice on mortgage deals by text and live web chat must still assess whether the mortgage is appropriate for the customer.<\/p>\n

Investment Firms<\/strong><\/h4>\n

Goldman Sachs Group, Inc<\/strong><\/h4>\n

The Goldman Sachs Group, Inc., the most powerful investment bank on Wall Street, is going to be the brand to watch over the coming months.\u00a0 Admittedly, it’s been a tough year so far for the group, following the crisis<\/a> caused by a ‘rogue’ employee Greg Smith, whose resignation letter<\/a> in The New York Times decried his firm\u2019s \u201ctoxic culture,\u201d and alleged that senior Goldman bankers had disparaged clients. The viral spread of Gerg’s letter lead to the losses of $2 billion worth of market value as company\u2019s shares fell 3.4 in trading over the course of the day after Greg\u2019s announcement.
\nCEO Lloyd Blankfein (who, incidentally, has an $16.2 million annual salary) hit the business news for the first time after two years’ silence with a confession<\/a>:\u00a0\u201cObviously it\u2019s occurred to us that we haven\u2019t gotten anything, er, everything right with respect to how we, how we\u2019ve dealt with the public”.
\n<\/em>
\nGoldman Sachs CEO\u2019s announcement was followed by immediate changes within the organisation: a new Head of PR, Jake Siewert, who started his work with an announcement of the new vacancy – Social Media Strategist. In a job posting on the company website, the bank said the ideal candidate will be responsible for \u201cmonitoring online conversations and participating in those conversations to build brand visibility and thought leadership.\u201d <\/em>Poisoned chalice or career-making challenge?
\nGoldman Sachs, who only started tweeting on their official Twitter account – @GoldmanSachs – on 24th May 2012, is taking the first step in entering the social media arena. Will Siewart’s efforts and those of the new ‘Social Media Strategist’ succeed in turning the beleaguered giant’s reputation around? Watch this space.<\/p>\n

Morgan Stanley Smith Barney<\/strong><\/h4>\n

She may not have composed it, but Fay DeBellis, a Minneapolis-based adviser for Morgan Stanley Smith Barney (MSSB), posted \u201cNext stop Dow 57,757?\u201d , and her version happened to be the 2,000th Twitter message by a Morgan Stanley adviser.\u00a0\u00a0600 or more of its 17,800 financial advisers\u00a0have been given access to Twitter and LinkedIn in the past year to seek out potential customers. As Mashable analysed<\/a> a year ago: “such professionals hadn\u2019t used either platform because of stringent SEC and FINRA regulations. Among those rules: Such advisers have to archive all their electronic interactions and they can\u2019t use LinkedIn\u2019s \u201crecommend\u201d feature because of the <\/em>Investment Advisers Act of 1940<\/em><\/a>. ” <\/em><\/p>\n

2011 has been a challenging year, trying to find the best solutions and the software to ensure compliance with the regulations. Morgan Stanley has opted for Socialware<\/a>. Socialware sells software that can archive messages, house a library of prewritten content and allow compliance officers to oversee postings. Fay DeBellis’ tweet wasn\u2019t an impromptu thought from an investor. It was a prewritten post, taken from a library of 140-character messages that had been approved by the compliance department of Morgan Stanley and sent out by financial advisers at Morgan Stanley Smith Barney.<\/p>\n

Ms DeBellis assessed<\/a> that LinkedIn alone has bought her about $10 million worth of business over 18 months.<\/p>\n

In June 2011, MSSB also launched Advisor Insights<\/a>, claiming it to be the first internal social networking site for such financial advisers. Working like an internal version of LinkedIn, financial advisers with experience in a specific area post their profiles, follow peers, and pair up with other advisers within the company who need their expertise.<\/p>\n

“Our social media program allows [financial advisers] to use LinkedIn and Twitter in a compliant way<\/em>,” says Pollak. “They can have a robust LinkedIn profile that discusses their practice and specialties, broadening their online presence and allowing them to leverage the networking and thought leadership capabilities the site offers. It allows [advisers] to find mutual connections with customers\u2014essentially making every prospecting call a warm call instead of a cold call<\/em>.”<\/p>\n

<\/h4>\n

J.P. Morgan<\/strong><\/h4>\n