to tapping into this new opportunity without breaking the rules.
Acknowledgments
You've heard it before: it takes a village. But you know it's true when we're talking about compliant social media for the financial industry!
Numerous industry leaders and experts shared their invaluable time and insights, and for that I'm especially grateful. They include Melissa Callison, vice president of communications compliance, Charles Schwab; Michael Kitces, author of Nerd's Eye View; Blane Warrene, co-founder of Arkovi; Renee Brown, senior vice president and director of social media at Wells Fargo; Edward McNicholas, partner at Sidley Austin; Dan Schreck, head of investor relations at Equinox Partners; Tina Petruzziello and David Rozenson of Boston Compliance Associates; Marie Swift, CEO of Impact Communications; Barbara Stettner, managing partner of Allen & Overy; Frank Eliason, director of global social media at Citibank; Sunayna Tuteja, director, social business & e-commerce at TD Ameritrade; Frank Gosch, senior director of search and analytics at Hearst; Lindsay Tiles, managing director of social media at Charles Schwab; Mike White, chief marketing officer at Raymond James; Melissa Sochi, SVP of brand & marketing delivery at LPL Financial; April Rudin, founder of Rudin Marketing; Brittney Castro, founder of Financially Wise Women; and Bill Winterberg, CFP® and founder of FPPad. You all bring tremendous energy and foresight.
I'm grateful to the Wiley team, especially Tula Batanchiev, for immediately seeing the tremendous need for this book. Judy Howarth, thank you for your valuable production guidance.
Stuart Fross, partner at Foley & Lardner, a gifted attorney and dear friend, and Amy McIlwain, president of Financial Social Media, were both invaluable contributors. You've enriched this guide with your expertise.
Two people – among the most dedicated I've ever met – deserve special applause. Marketing Manager Sherry Chen brought her usual perfection to the images and examples in the book, and Jerry Gleeson, one of the most gifted editors in financial journalism, imparted his years of wisdom and breathed life into my words.
Finally, to my family – husband Randy and daughters Gianna and Elizabeth – you are my village of support and sage advice on the homefront. When I walked through the door and shared the delight at nearly completing the book, you were just as excited.
“Where's the book, Mommy?” asked 4-year-old Gianna. “Can I see it?”
“It's not ready yet, honey,” I said. “But you can help me choose the cover.”
“Okay!” she said with glee.
I showed her the four options that the publisher had sent over. After just a few moments, she pointed confidently at one…and I knew it was the right choice.
Introduction
Nicky Gumbel arrived early at his kid's soccer game. Realizing the regular referee was late and no other dads were around, he decided to step in.
Nothing was set up – no cones, no nets, no markings for the boundaries. Gumbel wasn't a soccer player himself and knew little about the rules. But he thought, What the heck, let's get the kids on the field and start kicking the ball.
The problems started early and quickly escalated.
“Some shouted that the ball was in. Others said it was out. I wasn't at all sure, so I let things run,” Gumbel recalled. “The game soon descended into complete chaos.”
Kids were getting hurt and arguing over purported fouls, but Gumbel couldn't tell who was right or how to resolve the disarray.
Then Andy, the regular referee, appeared on the scene. “The moment Andy arrived, he blew his whistle, arranged the teams, told them where the boundaries were, and had them under control,” Gumbel said. “Then the boys had the time of their lives!”
What does this have to do with social media in the financial industry?
Advisors frequently chafe against the restrictions that compliance places on them. That's become more acute in recent years, as people in the industry explore the bounds of what works and what doesn't in the new world of social media.
Yet limits – whether on the soccer field or in the financial social media world – actually create a framework. They allow us to operate within the cones and spawn a game with purpose and excitement. Without limits, we're not really free to enjoy the game, or our work.
Imagine you're an asset manager or an advisor at a bank or wealth management firm. You or your colleagues are on social media, conversing about whatever comes to mind, engaging with whomever – on Twitter, LinkedIn, or Facebook.
You know how conversations can get sometimes at the office water cooler or restroom? It's easy to toss off some uncensored bon mot, share a quick laugh, and head back to your desk. Well, people are doing that on social media, and the outcomes aren't always pretty. In fact, as you'll see in this book, the professional damage can be substantial.
The point is: without structure, there's chaos. Advisors and firms, and certainly compliance officers, need a sense of orderliness and oversight. The end investor does, too, for his own protection.
Hopefully, I bring a little perspective. In the early Internet days of 1999, I left a large investment advisory firm to head up to Silicon Valley. It was there that I launched Women's Financial Network, an online brokerage, content, and advisor network venture focused on this growing market. It was the Gold Rush of online action, and we were leading the way, with 1,000 women signing up for our service each day. Since then, I've advised and worked for many firms and nonprofits, trying to bring a consumer-focused experience that leverages the technologies of the day.
Leap forward 10 years, and today that milieu is social media. We are in Web 3.0, where business relationships can be built – and brands ruined – with a handful of keystrokes.
There's danger for investors, too. Unscrupulous individuals can now reach thousands, if not millions, of people to tout some dangerous investment or maybe even attempt to access their personal financial information.
Do we need structure? You bet. Not just to protect our business, but to enable you – the advisor or the firm – to operate freely and successfully.
The insights and guidance you're about to glean from this book come largely from my work over the past three years with more than 300 firms – from small registered investment advisers (RIAs) and banks and wealth management divisions to hedge funds, mutual funds, and other asset managers.
Some time ago, the leaders at LinkedIn approached me about joining their Influencer program – a chance for accomplished professionals in various industries to write about issues from their perspectives. I held off at first because I was preoccupied with my job and my column at MarketWatch, but curiosity about writing on a new social media platform led me to try it out. The experience with my first column astonished me: Every hour I checked in, the views would go up by a thousand. I found myself replying to some of the comments, which produced more comments. Overall, the story generated more than 100,000 views and 400 comments – four times what many articles in traditional online channels generate.
As impressed as I was by that, I understand that many people still have questions about what social media means for them. Indeed, even as this book was going to press, a new study by Gallup questioned social media's impact – 62 percent of consumers surveyed by the firm said social media had no influence on their buying decisions.
Clearly, social media is in its infancy, especially in our industry. There's still a great deal of debate over things like return on investment (ROI), but my goal here is to at least provide you with the rules of the game and some insights as to how others – advisors, managers, and even associations in our industry – are playing on the field.
I know you don't have much time, and that's why this book is designed to answer the biggest questions you ponder over every day when it comes to using social media. You'll find lots of specific guidance and how-tos, along with compelling visuals to illustrate how you might move forward.
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