Marketing to clients is no longer a one way process. But for the hedge fund industry, the dynamic dialogue offered by social media still presents many challenges from regulatory compliance to negative perceptions of the new technologies available.
Managers may want to actively engage social media or purely monitor their brands online presence. If used effectively and strategically, these channels present real opportunities to managers to help meet their business objectives.
Although many funds are using social media to identify investment opportunities; How many managers are utilising these channels to promote and "market" their funds? What are your objectives in using the platforms available? Are you seeing tangible benefits to your business? How are you measuring your investment (incl. time and resource)?
With my 15 years background in banking and asset mgmt working with alternative investments, I am planning to launch a venture to provide the hedge fund industry with social media services.
Many thanks in advance for your input. Richard
You're doing this with hedge funds? I can't see big endowment and retirement fund managers hanging out on Facebook...and it seems the norm that many hedge funds like to stay as private as possible...exactly the opposite of what social media is about.
Where I can see the idea possibly working is in retirement plan advisory services and the like. The majority of retirees and people who must actively plan about their retirement haven't grown up with social media and the internet...but we (current 20-30) have and, like it or not, ARE growing older.
I could get on board with something like this. Not a bad idea. Just make sure you listen to Zuck on this one and make it exclusive enough to keep their attention. Another big road block would just be the whole "hedge funds can't advertise" thing. Don't know if that applies here.
The restriction on advertising/direct marketing to the public is being removed with the JOBS act.
Nabooru, Thank you for your comments. I agree with you. This is the problem with the term "social media", and hence my reference to negative perception. Social Media is more than just Facebook. It includes blogs, micro blogs (i.e. Twitter), social networks (e.g. Facebook, LinkedIn), video (YouTube), location based apps and internet forums such as Hedge Funhouse. All these are valid methods of connecting with prospective clients, building networks and advocacy programs. The key is to find where YOUR audience is online. In regards to privacy, whilst I agree many funds thrive on their anonymity, many start ups and/or smaller managers are still chasing AuM. Social Media has the benefit of extending their reach. Larger or established managers should still be aware of what discussions are happening about their brand - regardless if its negative, positive or indifferent - to ignore these discussions could potentially lose firms their competitive edge.
Many thanks for joining the debate.
BlackHat, Many thanks for your response, great to hear that you could be "onboard"! Zucks Facebook is not really the platform that would deliver an effective strategy for fund managers. This may well change overtime though, see "BranchOut" - a FB app to challenge LinkedIn, but will this be a serious challenger? Again in my opinion no; FB is a platform that enables people to keep updated with friends and family with updates about weekend shenanigans etc.I would not expect the majority of institutional clients to cross over their social lives with their professional personas to that extreme. On the advertising topic; online communities do not like being sold to - what people want is engaging content, connecting with thought leaders, receiving information that will enhance their lives and/or business. Social Media is not about selling; its giving people a reason to buy. Also the recent SEC ruling on the back of the US JOBS act enables Hedge Funds to speak more freely. Keeping this in mind and having a thorough understanding of the relevant regulatory jurisdictions will enable my venture to create effective strategies and that will ensure that firms maintain compliant.
Thanks for joining the discussion.
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