Morgan Stanley Approves Advisors to Use Social Media
May 27, 2011 § Leave a comment
5.28.11 Earlier this week, Morgan Stanley announced financial advisors will be able to use LinkedIn and Twitter in a more interactive fashion. To date, the financial services industry has limited use of social media due to regulations as well as general concern regarding risk associated with the medium.
According to articles from the Socialware Blog (Morgan Stanley’s vendor for social media management), Financial Times, and MarketWatch, Morgan Stanley will pilot social media with about 600 advisors in late June, and based on that success, roll out social media tools to its 17,000 plus advisors at a future date. The scope of the effort will focus around giving advisors access to pre-approved content that can be used in social networks and the ability to connect with clients via LinkedIn.
As a quick history, financial services firms are forced to treat social media like any other communications medium, which means that posting content (even as mundane as a LinkedIn profile) must be reviewed and approved. The same holds true for updates in social networks. Today, most of this guidance is provided by the Financial Industry Regulations Authority (FINRA) and the entire set of rules are complex to say the least. For this reason, not to mention a firm’s fear of incident and reputation risk, social media has been generally off limits.
While this is a step forward, it will be interested to see how well this experiment works for Morgan Stanley. On a positive side, the firm will get used to using social media and be able to create a baseline for its impact on business objectives. On the other hand, with restrictions on what can be posted and how advisors can use the medium, it is possible the experience will be so watered down as not to be effective for engaging clients. However, firms need to start somewhere and I applaud Morgan Stanley for trying with a small scale experiment to learn and adjust. Furthermore, I hope they stick with it as I think this first go round will likely need some major tweaks before full roll out.
If anyone has any other reactions or comments please let the fly. This is a great topic for some healthy discussion.