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TheStreet Open House

Financial Firms Take to Facebook, Tweeting

Franklin Templeton, Putnam Investments, The Hartford (HIG) and Vanguard offer blogs. A growing number of asset management firms may use Facebook and Twitter profiles to target clients and prospects, but Janus (JNS), MFS Investment Management and New York Life go the added step to direct their posts toward financial professionals.

Despite initial steps into the medium, McGovern says many of the firms they track "do not appear to have a clear strategy for gathering fans and followers and leveraging these social media efforts." The majority of firms employ a single, general-interest profile on Twitter and Facebook to drive traffic to their websites via links to market commentaries, educational articles and tools.

Of the 16 firms Corporate Insight tracks that are using Twitter, only one-third use their profiles to interact regularly with their followers. Despite the growing number of banks, brokerages and credit card issuers using Twitter as a customer service channel, only two asset management firms have used their accounts to provide customer assistance, and even then in a limited capacity.

One area where asset management firms are innovating, however, is with blogging. Mutual fund companies, in particular, have embraced the medium, McGovern says.

"Blogging makes a lot of sense for mutual fund firms," McGovern says. "Many leading fund managers have clear and strongly held views on the investment prospects of specific markets, industries and companies. Investors and financial advisers might find a lot of value in reading these views, especially if they're updated on a regular basis in response to events."

Although strict regulations may hold a firm liable for information published on its website, asset management firms have worked within the parameters of regulatory statutes to allow users to post comments, retaining the social nature of a blog, McGovern says. Putnam and Vanguard allow users' comments with pre-approval, publishing remarks from investors and advisers only after the firm reviews and grants their approval.

Rather than offering a generic company profile, AXA (AXA) and Nationwide (NFS) have taken the more offbeat approach of using "spokespeople" from advertising campaigns in their social media outreach. The "World's Greatest Spokesperson" Facebook page from Nationwide and the "@AXA_Gorilla" Twitter profile try to stand out from their peers by using humor.

McGovern sees the growing pull of social media as "marketing 101."

"You want to go where your customers, and your potential customers, are," he says. "Facebook passed Google (GOOG) in March of this year as the most visited website in the country and it has 500 million registered users, which is about 10% of the planet's population. It is also no longer just a Generation Y thing. It is increasingly popular with older investors , with grandparents as much as it is with college kids. Companies have a reason to think a little harder about whether it is still safe for them to turn their noses up at this and treat it like a fad. If you look at the top 20 websites in the U.S., by traffic, nearly half of them, in some way, are related to social media."

-- Written by Joe Mont in Boston.



>To contact the writer of this article, click here: Joe Mont.

>To follow the writer on Twitter, go to http://twitter.com/josephmont.

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