But Writing on someone’s wall in Facebook is not a new concept. We’ve been writing on walls for millenia.These cave wall drawings were a way to tell stories and communicate with the people in your network. Of course, your network was just the a cave full of neanderthals.
Social media or Web 2.0 is just another step in the evolution of communication. Tools that help us communicate have come and gone over the centuries. Some stay for a long time. The telephone has been around for over a century.The pony express only lasted for 18 months, before it was quickly replaced by the telegraph. A tool that was cheaper, faster and more reliable.
Social media is really an evolution, not a revolution. Web 1.0 was the age of web surfing. The era of yahoo.You could go to Yahoo where they had compiled links to some of the best sites on the web.It was hard to find good web content
Web 1.5 was the dawn of search and Google in particular. Google made it much easier to find stuff on the internet.
Web 2.0 was different in a few ways.It notifies you when there are changes to a website, so you don’t need to go to the website, the information issent to you. Also, the technology evolved making it easier to produce web content without having to know coding or html.Other websites, allowed you to add your own content to their site. Whether it was a simple as a comment to a blog post, or a professional video on YouTube.Those changes turned websites into communication platforms instead of the mere billboard ads of Web 1.0.
Why should you care?The old expression is that: “If you want to have a good day fishing, you need to go where the fish are.”If you want to reach your customers and potential customers, you have to go where they are.
Increasingly, they are actively using web 2.0 sites.
Let me spend a minute talking about blogs
Sort of.Here is a static page within my blog that’s not dated and does not allow comments.
Here is a story from the Boston Globe. Its dated and has comments.So which one is the blog.
We have a web 2.0 president.The White House has a blog.
Not to be outdone, the president of Russia has his own blog.Who said the cold war over.
We have all types of businesses using blogs as a way to publish content. Even some mutual fund companies
Blogs carry some baggage of being snarky and lack editorial control.Really they have evolved to being web content management tools. They are really good at publishing information on the web.
Twitter is the media darling right now. Largely it is micro blogging
It’s had a phenomenal growth rate over the past few years. Recently having the 10 billionth update posted to Twitter.
There is a lot of focus on the 140 character limit of TwitterBut plenty of interesting, if not monumental things have been said in less than 140 characters.
I use twitter in a personal way, I push my blog posts, share interesting news, stay in touch with friends and colleagues.
But I also use it merely as a publishing platform. I have a separate Twitter account for my Blog and I merely publish links to a post when it gets published.
Even some mutual fund companies are using Twitter
Facebook is the other platform that should be of most interest to this audience.
Facebook started off as a communication tool for college students. When it opened up to a broader audience in 2007, I was fascinated at the communication potential of the platform. There were so many ways to stay in touch with people and convey information. It was certainly more powerful than anything we had internally.
Last year they created a new feature called pages, which are aimed at companies who want to use Facebook to stay in touch with their customers. I set up a Facebook page for my Compliance Building blog. So its 56 fans see my blog posts as part of their activity stream
For the 8,000 plus fans of Vanguard on Facebook, they see the Vanguard updates in their activity stream and can consume other content on that Fan page
There was a recent study on how social media sites affect customer loyalty. They found that the Facebook fans were the best customers, were most likely to recommend the company to friends and had a greater emotional attachment to the company.They also point out, importantly, that although there found a correlation, the experiment was not set up to show causation.
Back to the fishing. Its not just customers who are using these site. Your employees are using these sites. So the other aspect is how you deal with your workforce
Some companies take the approach of blocking access to the sites.Which is fine, although ineffective.
Your employees do not need the company equipment or company network.Unlike many of our websites, these social media sites generally have a nearly full functional version that works on a smartphone.
I’m not going to dive into the FINRA regulations.You know them as well as I do.
If you look at the advertising disclosure requirements for mutual funds under Rule 482, there is no way you are going to get all of that required disclosure into the 140 characters of a twitter updater or a facebook update.
FINRA has been very proactive and issued some guidance on how social media sites fit into the existing regulatory framework. The guidance said that you can use the sites as long as you comply with the existing compliance requirements
They try to draw the line between static content and interactive content.But that line does not really exist any more. Most of the social media have different combination of static and interactive content.
One thing is good is syndication.If you have good, complaint content, then push it out through multiple communication channels. Drive traffic back to the “Dot.com”
The fish are out there in the social media sites.
Social Media and Compliance
Social MediaandCompliance<br />Doug CorneliusComplianceBuilding.com<br />
What hath God wrought? <br /> Samuel Morse: 22 characters <br />Mr. Watson, come here, I want to see you.Alexander Graham Bell: 41 characters<br />That's one small step for man, one giant leap for mankind.Neil Armstrong: 58 characters <br />
Public Appearances</li></li></ul><li>Rule 482<br /> (b) Required disclosure. <br />This paragraph describes information that is required to be included in an advertisement in order to comply with this section.<br /> 1. Availability of additional information.An advertisement must include a statement that advises an investor to consider the investment objectives, risks, and charges and expenses of the <br />investment company carefully before investing; explains that the prospectus and, if available, the summary prospectus contain this and other information about the investment company; I<br />dentifies a source from which an investor may obtain a prospectus and, if available, a summary prospectus; and states that the prospectus and, if available, the summary prospectus should b<br />e read carefully before investing.<br /> 2. Advertisements used prior to effectiveness of registration statement. An advertisement that is used prior to effectiveness of the investment company's registration statement or the <br />determination of the public offering price (in the case of a registration statement that becomes effective omitting information from the prospectus contained in the registration statement I<br />n reliance upon Rule 230.430A must include the "Subject to Completion" legend required by Rule 230.481(b)(2).<br /> 3. Advertisements including performance data. An advertisement that includes performance data of an open-end management investment company or a separate account registered u<br />nder the 1940 Act as a unit investment trust offering variable annuity contracts (trust account) must include the following<br /> 1. A legend disclosing that the performance data quoted represents past performance; that past performance does not guarantee future results; that the investment return and <br />principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost; and that current performance may be l<br />ower or higher than the performance data quoted. The legend should also identify either a toll-free (or collect) telephone number or a website where an investor may obtain performance <br />data current to the most recent month-end unless the advertisement includes total return quotations current to the most recent month ended seven business days prior to the date of use. <br />An advertisement for a money market fund may omit the disclosure about principal value fluctuation; and<br /> 2. If a sales load or any other nonrecurring fee is charged, the maximum amount of the load or fee, and if the sales load or fee is not reflected, a statement that the performance data <br />does not reflect the deduction of the sales load or fee, and that, if reflected, the load or fee would reduce the performance quoted.<br /> 4. Money market funds. An advertisement for an investment company that holds itself out to be a money market fund must include the following statement:<br /> An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value <br />of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.<br /> A money market fund that does not hold itself out as maintaining a stable net asset value may omit the second sentence of this statement.<br /> 5. Presentation. In a print advertisement, the statements required by paragraphs (b)(1) through (b)(4) of this section must be presented in a type size at least as large as and of a style <br />different from, but at least as prominent as, that used in the major portion of the advertisement, provided that when performance data is presented in a type size smaller than that of the <br />major portion of the advertisement, the statements required by paragraph (b)(3) of this section may appear in a type size no smaller than that of the performance data. If an advertisement I<br />s delivered through an electronic medium, the legibility requirements for the statements required by paragraphs (b)(1) through (b)(4) of this section relating to type size and style may <br />be satisfied by presenting the statements in any manner reasonably calculated to draw investor attention to them. In a radio or television advertisement, the statements required by <br />paragraphs (b)(1) through (b)(4) of this section must be given emphasis equal to that used in the major portion of the advertisement. The statements required by paragraph (b)(3) of this <br />section must be presented in close proximity to the performance data, and, in a print advertisement, must be presented in the body of the advertisement and not in a footnote.<br /> 6. Commission legend. An advertisement that complies with this section need not contain the Commission legend required by Rule 481(b)(1).<br />