Healthcare companies, financial
services firms and others are taking advantage of social media, even while
awash in rules. Here’s how the do it.
Social networking is serious business
within regulated industries. Posts pertaining to finance, insurance and
healthcare, in particular, require adherence to strict government and industry
regulations. However, even with the rule-a-palooza, some companies in these
industries have not only found ways to keep regulators happy, but have also
made social networking a productive and key part of doing business.
Tiptoeing
Into Social Media
That said, the phenomenon is still in
fairly early stages. Only around 10% of the companies in regulated industries
have a “truly social” enterprise where multiple social media tools have been
integrated into general content consumption, according to Toby Ward, founder of
Toronto-based Prescient Digital Media, a consulting firm for Fortune 500
companies.
“It depends on the organization and their
level of savviness,” he says. Companies where executives start their own blogs,
for example, are more likely to use social media effectively and adopt it
widely, according to a recent study by Prescient. “Almost all major banks have
been in social media for at least a few years,” Ward says.
Show Me the Regulations
Banks are embracing social media despite
the fact that the financial services industry may be subject to the strictest
compliance requirements and regulatory mandates. In just one example, in January
2010, the Financial Industry Regulatory Authority (FINRA) published guidelines
for blogs and social networking sites that, among other things, outline
specific record-keeping responsibilities and supervision requirements.
Banks
are embracing social media despite the fact that the financial services
industry may be subject to the strictest compliance requirements and regulatory
mandates.
That hasn’t stopped MassMutual, a
Springfield, Mass.-based financial services firm, from using social media. “We
developed our social media strategy by forging a partnership with key contacts
in our company’s legal and compliance departments,” says Marie Politis,
MassMutual’s vice president of online experience. “Regulatory requirements are
even more stringent when it comes to communications by individual members of
our sales force.”
MassMutual is working with Actiance, a
Belmont, Calif.-based social media consultancy, to roll out a pilot program
that meets FINRA’s requirement to review and archive initial, or static, social
media posts. (“Static” is a term used by FINRA to describe initial posts; once
the audience engages with the content, the resulting conversation is considered
“interactive.”) Another MassMutual goal for its pilot program is to monitor
interactive communications, which must be reviewed.
The benefits of connecting with existing
and potential customers through social media make the effort worthwhile,
practitioners say. “Money is a highly sensitive topic,” says Michelle Peluso,
global consumer chief marketing and Internet officer at New York-based
Citigroup. “One of the things social media allows us to do is to listen in to
hear what people say about our brand, our competitors, our industry, products
and services, and our people.” Even given all those advantages, though, “we
have to think hard about the regulatory challenges,” she admits.
When customers have a bad experience with
Citi, they may complain about it in the Twitterverse or on a blog. “We don’t
let the fact that we’re a regulated industry dehumanize us,” says Peluso, who
has a team of customer service reps who are trained to help people who
criticize Citi on social media.
“We don’t use the same scripted response
every time, which you may find with other banks that use a standard answer
approved by Legal,” she says. “Our reps can use their real Voices’ and
personalize a response.”
In addition, Citi reps have been trained to
move customers off of public feeds and into a private chat environment, where
issues can be resolved confidentially and securely.
Social media can also be used for more
traditional marketing efforts, such as making sure people are getting the
information they need and that the information is accurate, says Peluso.
Rebuilding Trust in Banks
“One current challenge we face is that many
people have a deep-seated anger with the banking industry,” says Renee Brown,
social media director at San Francisco-based Wells Fargo. “Consumers are not
trusting us right now.” That makes it especially important to engage customers
constructively via social media, since many people hit social sites when they
have complaints.
But the need to, for example, retain client
records for seven years and make sure company reps comply with the rules and
regulations can delay efforts to get involved with social media. Wells Fargo
partners with consultancies that help make sure the bank meets regulatory
requirements and is still “able to interact with customers, clients and
potential clients,” says Brown.
Wells Fargo’s vendors include Hearsay,
Socialware and Actiance. “These companies offer software to help with pre- and
post-review options to ensure content is appropriately vetted, helping to
streamline our internal processes,” says Brown.
The two most regulated areas involve
broker-dealers. They include investment banking and Wells Fargo’s brokerage
unit, as well as its home mortgage consultant network, says Brown.
One
of the first steps in resolving customer issues is to separate actionable
complaints from people who simply want to vent
One of the first steps in resolving
customer issues is to separate actionable complaints from people who simply
want to vent, says Brown. From there, helping customers resolve problems must
exclude, by law, giving financial advice via social networks.
“While you may post a note to a friend
about an investment, when you are licensed, you can’t use certain terms such as
mutual fund without it triggering the need for a disclosure,” says Brown. “We
make sure we go through the right compliance reviews before it’s posted so
nothing gets out there that shouldn’t be posted.”
This involves the bank’s vendors “along
with our legal and compliance partners to ensure we have the right oversight in
place, but also the ability to be timely in posting and responding on social
media channels,” Brown says.
Similar Rules
Insurance industry regulations also require
due diligence regarding social media interactions. Generally speaking, these
are “the same rules that apply to advertising,” says Michele Wingate, social
media manager at American Family Insurance in Madison, Wis.
Conversations or interactions posted by
agents or anything on a social network must be archived in case they are needed
for a response to any future legal challenge, Wingate says. To do that,
American Family uses social media management software from Shoutlet, a provider
of cloud-based social marketing tools.
Wingate admits it can be a challenge. “Our
agents are eager to tap into other networks, but in order to comply with
regulations, we can only use those for which we’re able to archive content,”
she explains. Currently that list includes Facebook and Twitter, and it may be
possible to archive Linkedln content later this year.
Interestingly, the largest response to an
American Family corporate Facebook stream had nothing to do with insurance.
Instead, it was tied to the company’s “Celebrating and Protecting” social media
messaging effort, says Wingate. Conversations about National Chili Dog Day in
July garnered more than 1,000 engagements (likes, shares and comments) a record
number, says Wingate. “It was a happy thing, and those interactions kept us top
of mind she says.
