The Future of Social Media in

Asset Management & Insurance

Jesse Mark, Senior Research AnalystIgnites Distribution Research

September 17, 2013

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Reports: In-depth analysis of broader and more significant industry issues (5-8 pages)

Briefings: Thorough discussion of key topics designed for quick consumption (2-4 pages)

Perspectives: Timely analysis of industry developments (1 page)

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Agenda

• Why is Social Media Gaining Importance?• Social Strategy in the Asset Management Industry• Best Practices From Our Industry

– Blogs– Twitter– LinkedIn– YouTube– Facebook

• Measuring Results• The Future of Social Media…

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Why Social Media is Gaining Importance

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Shifting from Controlled Communication to Uncontrolled Communication

Advisors and investors can share opinions about the brand whether the brand likes it or not

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Firms No Longer Own Their Brands

• Customers don’t need to rely on the firm to get information to make purchasing decisions

• Cluetrain Manifesto (1999): “There are no secrets. The networked market knows more than companies do about their own products… and they tell everybody…”

• Brand is determined by what customers and prospects say it is, not what you say it is

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United Airlines: Learning The Hard Way

1. United Airlines passenger Dave Carroll had his Taylor guitar destroyed by the airline's baggage

2. United repeatedly declined to reimburse him for the damage

3. Carroll writes now-famous song mocking United customer service

Result: 13.3 million views

$180 mill loss in UAL shares

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Opting Out is Not a Long-Term Option

• Clients will talk about your firm whether you are on social media or not

• Conversations cannot be controlled, only joined• Brand advocates will defend your firm and help support the

firm’s products

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BRAND ADVOCATES

COME TO THE RESCUE AND DEFEND THE

FIRM(VANGUARD)

The Sales Cycle Has Changed

• Advisors are doing research before talking to wholesalers• Firms need to provide content to aid decision-making early on

in the sales process

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Trust Matters in Our Industry

• Performance-related attributes are table stakes• They alone do not build trust

11Source: CFA Institute & Edelman, Investor Trust Survey 2013

Social Provides Platform to Build Trust

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Advisors Use Social Media

• Almost 90% of financial professionals have at least one social profile

• Some 61% report using social media weekly (40% several times a week)

• Two-fifths of FAs believe social media has value for their business

• One-fifth of FAs have already seen tangible results from social

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Firms Need to Be Where Advisors Are…

14Source: American Century Social Media Report 2013

…But Need to Determine Opportunity

15Source: American Century Social Media Report 2013

Help Advisors Do What They Do

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Broker Dealers Slowly Embracing Social

June 2011: Commonwealth becomes first B/D to offer FAs FINRA compliant solution

December 2011: Raymond James offers FAs ability to post on LinkedIn, Facebook, Twitter

June 2012: Morgan Stanley expands access to Twitter & LinkedIn

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FAs Have Formal Social Policies, But Not Necessarily Compliant Processes

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Social Strategy in the Asset Management Industry

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Social Media Isn’t A Top Priority…

• Social isn’t top of mind for most marketing executives

• Many firms lack dedicated social media talent

• Senior management buy-in (and budget) are often lacking to make social media successful

20Source: Ignites Distribution Research survey

Usually, Social Is De-Emphasized

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Top Marketing Priorities for 2014

• Increasing brand awareness is the top cited priority

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But Social is Aligned With Top Marketing Strategy Items for 2014

• Social media can help reach five of the top priorities

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Many Firms Not Skilled in Digital/Social

• In 2013, 70% of marketing budgets spent on print

• Firms more adept at traditional work than digital work

• Top firms are investing heavily in digital hiring and training

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What Asset Managers & Insurers Are Doing on Social Media

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Best Practices & TrendsBlogs

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What Asset Managers Do With Blogs

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A Human Face In Front of the Brand

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PICTURE THE AUTHOR & DESCRIBE

HIS OR HER BIO(OPPENHEIMERFUND

S)

Writing for the Web

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1 INFORMAL AND CASUAL STYLE

FREQUENT USE OF IMAGES AND CHARTS

(RUSSELL INVESTMENTS)

Help Advisors Find What They Want

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UTILIZE (CLOCKWISE):1.TAGS2.CATEGORIES3.SEARCH

FUNCTIONALITY

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Social Can Help Advisors Find Info, Too

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UTILIZE: 1.MOST DISCUSSED/

VIEWED2.HIGHEST RATED

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Sparking Conversations and Debate

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VANGUARD’S BLOG REGULARLY GETS A FEW DOZEN COMMENTS & QUESTIONS PER POST

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BLOG AUTHORS RESPOND TO COMMENTS WHEN NECESSARY

Best Practices & TrendsTwitter

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What Asset Managers Do On Twitter

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Identify Contributors to Personalize the Brand

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TWITTER BRAND PAGES1.NATIXIS2.VANGUARD3.ISHARES

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Social Media Isn’t All About You:Putnam Content Mix Strategy

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40%60%

Putnam content• Thought leadership• Product updates• Practice management

expertise• Market commentary• Sports marketing• Company news

News you can use• Industry trends• Broad economic

trends• Practice-related

technology updates• Latest from

respected sources• Retirement and

saving trends• Humor!

Source: NICSA, 2012 Expo

(Targeted) Content is King

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31 & 2: VANGUARD PROVIDES SEPARATE TWITTER CHANNELS FOR INVESTOR AND FA

3: RUSSELL CLEARLY INDICATES THE INTENDED AUDIENCE ON A SINGLE FIRM WIDE TWITTER FEED

Showcase Traditional Support Channels

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CLIENTS AND PROSPECTS HAVE QUESTIONS AND WANT TO KNOW WHERE TO GET ANSWERSPICTURED: T. ROWE PRICE & FRANKLIN

But Clients Will Ask Questions When & Where They Want To

• 88% of people said they would be less likely to purchase from a company that ignored their questions on social media

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CLIENTS AND PROSPECTS ASK BRANDS QUESTIONS AND EXPECT ANSWERS (EVEN IN HIGHLY REGULATED INDUSTRIES)

Source: eMarketer, Inc. survey (2012)

Best Practices & TrendsYouTube

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What Asset Managers Do On YouTube

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Moving Beyond “Talking Heads”

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IVY FUNDS OFFERS CLIPS FROM AN INVESTMENT TRIP TO VARIOUS CHINESE COMPANIES(IVY FUNDS)

Facilitating Client Education

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OVER 70% OF ADVISORS SHARE ONLINE MATERIALS WITH CLIENTSPICTURED: ISHARES

Best Practices & TrendsLinkedIn

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What Asset Managers Do On LinkedIn

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“Influencers” Command More Attention

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• In October 2012 LinkedIn launched the Influencer program– Allows selected “thought leaders” to share original content directly

with LinkedIn users

Sponsored Groups Targeting Advisors

• Putnam creates library of tips to help advisors with technology, apps, mobile devices, and Social Media

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LinkedIn Groups Can Support Other Areas Like Practice Management

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Best Practices & TrendsFacebook

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What Asset Managers Do On Facebook

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Appoint Community Managers

• Community managers plan content, moderate discussions, monitor activity, and engage with the social community

• Community managers are the face of the firm’s social media presence (e.g. Bonnie & Ben at Vanguard)

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Schedule Live Q&A Sessions to Increase Transparency

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1. A REAL Q&A SESSION FROM MAY 2013 WITH JOE DAVIS AT VANGUARD

Measuring Results: What Metrics to Look At?

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Why Measuring ROI Is Important…

• Greatest challenges to social media participation are getting budget and buy-in from senior management

• Social media isn’t free– Technology & compliance costs– Social media advertising– Outsourced designs/ creative costs– Marketing, e-Business, Communications, Compliance Salaries

• C-Suite wants to know how well the organization’s objectives are being met

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But It’s Not That Easy…

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Are You Measuring the Right Things?

• Key performance indicators (KPIs) should be identified and measured

• Best KPIs link directly to raising revenue, lowering costs, and increasing client satisfaction.

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• Stats from one blog post repurposed on 5 platforms in 9/2011

How iShares/BlackRock Measure Results…

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Awareness Consideration Engagement(1) (2) (3)

Post on isharesblog.com 877 views 3 commentsSyndicated to SA and AP 9,819 views 31 commentsSend a Tweet 1,100 impressions 46 clicks 6 likes, 1 commentPosted to Facebook 1,863 Impressions 91 clicksPromoted Tweet 5 retweetsShares/Mentions/RTs 6 mentionsTotal 2,963 10,833 52

Source: NICSA Presentation by Eileen Loustau (2012)

…Quantify the Value of “Earned Media”

• ACE Approach (used by American Marketing Association)– Awareness: $ x # of impressions– Consideration: $$ x # of click-throughs– Engagement: $$$$ x # of comments, shares, likes, etc.

• ROI = Total media spend that would provide equivalent results– iShares: $6.8 million in earned media in 2011– iShares & Blackrock: $12.4 million in earned media in 2012– iShares & Blackrock: ~$18 million in earned media in 2013

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The Future of Social Media…

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Where We’ve Come From…

Late 80s/Early 90s – Business email introduced

Feb 1995 – First mutual fund homepage built

2008 – Early adopters created branded pages on social media

2009 – Early adopters started engaging with customers and prospects

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The Future of Social Media in Asset Management & Insurance

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“Digital-first” content process Newsroom mentality

Targeted engagement Sales team Enablement

Crowd-sourcing

Traditional Content Process Not Optimized For Social Media

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Idea Whitepaper PDF Sent by Mail & email

PDF Posted on Social Media

Leading Firms Are Embracing Digital Content Creation Process

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Idea Social Discussions Validate Idea

Content Created Simultaneously in Various Media

Content Shared on Appropriate Platform

Embracing the “Newsroom Mentality”

• The growth of brand-sponsored content will continue to rise• Content creation and dissemination now need to be one of

the firm’s core competencies

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JOHN HANCOCK CREATES CONTENT FOR FORBES

ISHARES BLOGS ARE SYNDICATED ON SEEKINGALPHA, THE AP, AND MANY OTHER SITES

Targeted Engagement on Social Sites

• Facebook Custom Targeting– Target their Sponsored Story or

ad to a specific set of users (e.g. all FAs in the CRM)

• LinkedIn Targeted Updates– Share status updates with

specific followers or audiences (e.g. Morgan Stanley FAs)

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Empowering Client Facing Professionals

• Putnam provides roughly three to five pieces of pre-approved content weekly

• Posts by wholesaler produce an average 3,500 impressions, 10 clicks, and like/comment

• Website traffic referred by LinkedIn has already doubled

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Crowd Sourced Thought Leadership

• Validate importance of specific topics• Decrease the cost of content development• Tap into collective wisdom of community• Build trust and Increase customer loyalty

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Crowd Sourced Tech Solutions

• Receive customer input and feedback early in the process• Tap into collective wisdom of community• Build trust and increase customer loyalty

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Please Connect on LinkedIn & Twitter

Jesse Mark, Ignites Distribution Research

jmark@money-media.com

212-542-1206

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