The expanded reach of social media makes it that much riskier when used in a business setting where key information can easily get leaked.
Social media has seen some big changes in the past few months, most recently with Twitter taking to its own platform to announce its IPO. While social has long been a wild animal to tame, it's arguably one of the best ways to connect with the public. However, the expanded reach of social makes it that much riskier when used in a business setting where key information can easily get leaked.
As social continues to grow, so do the regulations surrounding it. On April 2, 2013, the SEC changed the face of social for businesses when it declared social media an appropriate channel in which to communicate regulated information, including company news, earnings announcements and public filings. This opened the doors for material information to become publicly shared in a new forum. Over the past six months, we have seen both Netflix and Yahoo! stream quarterly earnings calls live via their social channels. Netflix went a step further and took questions from Twitter and answered them on their live call. Like Twitter, these companies are experimenting with creative ways to share valuable information with investors, most notably over social media.
Though few financial firms operating under FINRA or IIROC auspices have gone as far as sharing sensitive information over Facebook or Twitter, these easements in regulatory guidelines allude to an evolving acceptance of social media as a form of business communication - and one that financial firms cannot afford to ignore. Investors, customers, employees and board members are increasingly turning to new mediums to gather and share information, thanks to benefits that include real-time, easily accessible and digestible streams of information.
So what can firms do to begin adopting policies that align with how people find information via social? We subscribe to a three step process: Listen, monitor and push the envelope.
Listen
The best way to meet demands, identify certain trends and proactively address relevant issues is to listen to stakeholders. Social media makes public chatter easy to track via hashtag search. Customers and staff often utilize social channels to discuss what they wish companies would do. Meeting demands by making stakeholders feel heard can only help fuel a growth curve.
Monitor
By tracking investors, competitors and regulatory updates, a company can say in the loop on the wants and needs of external influencers. Are other firms using social? If so, how? What's worked and what has not? Have there been regulatory changes that businesses could take advantage of? By keeping a watchful eye on these trends, like Twitter did with its announcement via its own platform, firms can develop a strategy to address and engage important external audiences, while also staying educated and protecting the business from any regulatory infractions.
Push the envelope
Yes, the financial industry is more limited in terms of what can and can't be shared, especially via social media. But to stay relevant as the social sharing trend continues to grow, firms must reach stakeholders where the stakeholders are. Whether via video, social sharing or something completely different, firms cannot be afraid to get creative and be provocative. As Twitter's approach showed, diverting from the norm to deliver important company news is a new, proven way to communicate.
The adapt-or-die mentality is alive and kicking in the business world, as it ever was. The advent of social and our propensity to adopt it as individuals makes this impossible to ignore.
Sarah Carter is the general manager of social business at Actiance working with Actiance financial services clients on best practice social media and collaboration strategies in both Europe and the USA and regularly speaks on the topic on both continents.
