Morgan Stanley is taking its social media experiment to the next level.
The Wall Street firm plans to give the roughly 17,000 financial advisers at Morgan Stanley Smith Barney partial access to Twitter and LinkedIn over the next several months, stepping up its social media presence after a yearlong trial with a group of 600 employees. The expansion amounts to a bet that social media can be an effective business tool for modern-day financial advisers.
“For all of the criticism that Morgan Stanley has taken around this initiative, I would challenge anyone to show another firm of their size that is taking as aggressive an approach toward making social a strategic part of their business,” said Chad Bockius, the chief executive of Socialware, a start-up based in Austin, Tex., that counts Morgan Stanley among the financial firms it advises on social media.
Morgan Stanley is among the leaders on Wall Street’s tentative journey into the fast-paced world of social media. Goldman Sachs, which recently said it was looking to hire a “social media community manager,” has taken to Twitter to post news about the firm. The private equity firm Blackstone Group also maintains a Twitter account. Other firms, like AllianceBernstein, have given employees access to LinkedIn.
For Morgan Stanley, which had its credit rating cut last week by Moody’s Investors Service, the retail brokerage unit provides a reliable stream of fees. According to Lauren W. Boyman, the firm’s head of social media, using Twitter and LinkedIn has helped financial advisers win more business over the past year.
“The big takeaway is that it works,” Ms. Boyman said.
Still, don’t expect much personality from the new army of social media users. To stay in compliance with securities regulations, financial advisers will continue to draw from a prewritten library of Twitter messages and submit all LinkedIn postings for approval, using software designed by Socialware. An experiment that allowed a handful of employees to compose their own Twitter messages will be placed on the back burner for now, Ms. Boyman said.
These constraints have drawn some mockery from online commentators, who say the strictures hinder the spontaneity of social media. But defenders of the firm are quick to note that Morgan Stanley is going where its rivals on Wall Street have not yet ventured, tiptoeing into a world full of possible risks.
“It’s a lot harder to approve 140 characters than one might think it would be,” Ms. Boyman said. “Pretty much every tweet has a link to a report or an article or a Web site, and all that has to get read and approved.”
Citing research from the social media advisory firm Actiance, Ms. Boyman said prewritten Twitter messages have been 3.5 times more effective than original compositions for raising engagement online.
But James R. Cotto, a Morgan Stanley wealth adviser based in Purchase, N.Y., said Twitter wasn’t as effective as LinkedIn for getting new business. “I actually have LinkedIn open as an application every day,” said Mr. Cotto, 48, who manages more than $300 million. He hasn’t posted to Twitter.
One vocal critic of Morgan Stanley’s approach to social media, the financial adviser Joshua M. Brown, offered his congratulations on Monday.