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Poll finds firms failing to use social media potential

Almost 60 per cent of senior management in financial services firms think the industry has yet to utilise social media to its full effect, according to research from Cicero Consulting.

The firm says its study of 158 senior management figures across asset management, retail banking, investment banking, financial advice, accountancy and audit, trade bodies and regulators shows most firms are failing when it comes to social media.

Fifty-seven per cent say social media offer a new and interesting way of communicating with the public while 81 per cent see Twitter as the most important social network for their organisation.

Cicero says there is a fear of social media from some firms as 25 per cent are daunted by the volume of traffic and how to monitor or manage it, while 38 per cent of respondents say they have a lack of time and resources to manage it.

Fifty-nine per cent of firms are spending less than £50,000 a year on social media and 29 per cent are spending nothing.

Aviva and Lloyds Group lead the way in terms of Facebook and Twitter popularity. Aviva had 66,653 Facebook likes and 3,061 Twitter followers, while Lloyds had 65,554 Facebook likes and 4,424 Twitter followers at the start of January.

Standard Chartered came in third with a total of 41,800 Facebook likes and 4,366 Twitter followers.

Cicero head of digital Chris Jackson says the financial services sector can improve its reputation through the use of social media.

He says: “If financial services firms can use a human element and have senior figures using social media to speak to people without trying to sell products, they can improve the reputation of financial services which has declined in recent years.”

Forty Two Wealth Management partner Alan Dick says: “Social media is a good way for firms to spread messages and for IFAs to really show their personality, although we are not at a stage yet where we can measure an increase, if any, in business levels as a result of social media.”

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  1. There are good reasons why financial services firms do not use new media: COBS 4 and the equivalent rulebook for mortgages. Open new media comment is almost invariably capable of being construed as a client communication and must be clear, fair and not misleading. This requires balance with equal prominence to negative features. Balance and 140 character limits and even worse the number of characters initially showing on twitter make this just about impossible.

    One area of social media that could be appropriate concerns awards. Unfortunately, the FSA has indicated on a couple of occasions that reference to an award that is not purely for service in the investment area is a past performance claim requiring the usual risk warning/disclaimer. I think that the FSA is wrong about awards but the problem is there. Blaming the industry for sticking its head in the sand isn’t the answer. What is may be industry guidance on using new media. Currently, it really has to be limited to image advertising and service awards – not very appealing.

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