Vanguard, Fidelity top list of social-media-savvy fund managers

The Vanguard Group Inc. and Fidelity Investments top a list of firms in the asset management industry ranked by how well they use social media. In a survey conducted by kasina LLC, firms were rated on audience engagement, how well they integrate social media, and their success in developing new and useful content. In third place is TIAA-CREF, followed by iShares and The Hartford Financial Services Group Inc. These five firms all scored between 77 and 80 points, while the average firm scored 56, according to kasina's Social Media Index. Asset management firms are rushing to use social media in some shape or form, the kasina study found. While only 48% of managers were using social-media sites last year, this year, more than 80% of firms are doing so. “However, the vast majority of firms are just dipping their toes in the water,” said Lee Kowarski, a principal at kasina. As a result, there is a big range in the quality of how firms are using these sites, he said. For example, the leading firms ranked by kasina are using social media to have a dialogue with investors, he said. Vanguard, for instance, asks questions and responds to followers either through Twitter or Facebook. “It's not surprising that the top firms have their roots in the direct-sales and retail-asset-management business,” Mr. Kowarski said. “Intermediary-sold companies really have to catch up and learn how to properly engage with a mass audience.” Too often, fund companies blame the compliance constraints for why they can't do more with social media, he said. Firms need to get compliance to sign off on anything they post, generally speaking. “Compliance is crutch firms are using,” Mr. Kowarski said. “I think the biggest thing holding firms back from using social media to engage investors is inertia.” To use social media effectively, asset managers need to gain an understanding of how each venue serves its purpose, he said. “It's not just about posting press releases through your Twitter feed,” Mr. Kowarski said. “It's about having a strategy that really incorporates how the different channels work.”