I’ve now read the FCA’s finalised guidance on the use of social media at least three times and I wouldn’t criticise a word of it, in fact, given some tweets and posts I have seen over the months and years, the guidance is clearly needed.
Despite this, I can’t help feeling that for the majority of advisers and advisory firms the guidance should be irrelevant. But, it’s a sad indictment of how some people use social media that the guidance is needed.
My preferred social media platform is Twitter, I’ll occasionally venture onto LinkedIn and Google+, but so far I’ve not tried other options and I’m one of those rare people who doesn’t even have a Facebook account.
So why do I and so many financial services professionals find social media useful?
- First and foremost social media can be a great way to exchange ideas and get the thoughts of your contemporaries
- It helps to demonstrate expertise and knowledge
- It’s a very useful way of signposting people to longer articles and blog posts
- It allows users to learn from each other and interact with their peers; very useful in a sometimes lonely profession
There are of course huge social benefits. too; an interaction on Twitter often turns into an email conversation, followed by drinks and ultimately new friendships. But I digress, back to FG15/4; I doubt the social side of Twitter, Facebook etc was in the regulator’s mind when they finalised their guidance.
Irrelevant or vital reading?
So if there are benefits to using social media, why do I believe the FCA’s guidance should be irrelevant, surely it should be vital reading?
Yes and no.
No, because advisers and advisory firms (it is corporate accounts, which tend to post the majority of financial promotions) who get the best from social media don’t publish financial promotions in the first place and know the rules so don’t ‘step over the line’. They realise that social media is about starting and developing relationships, not flogging products or services to those people who have decided to follow or connect with you.
Yes, because some individuals and businesses still insist on posting financial promotions; the finalised guidance is therefore vital reading if they plan to continue.
As I said, my preferred platform is Twitter. So what characteristics do some of the tweeters I get most from, such as: @JosephineCumbo @martinbamford @pensionschamp @cashquestions @bankersumbrella @bridgetfsm @chrisdaems all have in common?
- Interaction They converse, debate and exchange ideas
- Knowledgeable They are clearly knowledgeable about their chosen field
- Share They are happy to share their thoughts whilst listening to those of others
- Engaging Much like real life, they are friendly and engaging
- Inform They will use their expertise and knowledge to share vital information with their followers
Of course they all signpost their followers blogs, articles and press mentions, but again this is valuable; I want to read more of their thoughts because I like what they’ve said on Twitter.
What don’t these people do?
In a word, sell.
Any new opportunities they pick up as a result of their social media use are a by-product (intended or otherwise) of the characteristics I’ve mentioned above.
They realise that trying to sell on social media is largely pointless and will mean they don’t get the best out of a very powerful communications tool.
Not convinced? Here are four more reasons not to publish financial promotions on social media
- You won’t get the best from your chosen social media channel. Anecdotally those who sell, will get fewer connections and followers, as well as lower levels of engagement. To put it bluntly, sales messages are generally not very interesting
- Most social media platforms impose a limit on the number of characters you can use. With Twitter it’s 140, that makes it hard to promote a financial product, be “clear, fair and not misleading”, whilst including the obligatory risk warnings
- Confusion over what is and isn’t a financial promotion could easily lead to mistakes being made and uncompliant tweets or posts being sent
- The FCA expects an accurate record of financial promotions posted on social media to be kept; this could be a laborious and time consuming process for very little benefit
If you insist of posting financial promotions on social media, read the latest FCA guidance carefully and make sure you stick to the rules.
But, if you want to get the best from social media, avoid financial promotions like the plague, your connections and followers will be eternally grateful!