Executive summary

Social Media is changing the way people communicate and interact with each other, and by extension, it is impacting the way we do business today. From the asset manager’s perspective, social media provide opportunities as well as challenges. In this report, we seek to identify the current state of asset management with regard to social media usage. We consider how leading asset managers in this area are interacting with end investors, and enumerate key considerations when implementing a social media strategy. Our report also attempts to look further into the future of the Social Era to see how asset managers can respond proactively to inevitable changes that will affect their industry. An evaluation of more than 100 leading asset management groups worldwide revealed that currently, asset managers use social media primarily for marketing and brand recognition purposes. Forty percent of the largest asset management companies are not active on social media, and remain in a “wait and see” position. Their reluctance to engage with the new media may be, in part, due to regulatory constraints and uncertainty. However, an analysis of the top ten companies revealed that they have strong brands and they use social media to augment awareness. The US asset managers use social media to a greater extent than their European counterparts. Also, the top ten asset managers in our study are all non-affiliated with a bank or financial group. The Asset Management Industry in the Social Era

Our research and interviews clearly show that engaging clients on social media is a primary objective for firms looking to maximize relationships. Whereas e-mail and websites are adequate means of communication, social media provide a platform for interactivity and integration that takes asset managers well beyond the scope of one-dimensional dialogue. However, within our sample, only 15% of asset managers are truly interactive. The data show that players who are rising to the top of their field strive to create an interactive flow of communication. They understand the importance and potential of interactive media and aim to capitalize on it. Setting up an Asset Management - focused Social Media Strategy - Key Considerations The decision by asset managers to use social media is not internally initiated; rather it is driven by customers who choose to communicate via these channels. Customers have come to expect almost immediate feedback and more direct access to their financial advisors.

When setting up a social media strategy, asset managers need to consider the following elements:

• Meet the needs of your audience - Using social media can expedite information dissemination, as well as augment investor and advisor education. User interactivity and networking are also ways to harness the benefits of social media.


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