Morgan Stanley (NYSE:MS) says that it plans on providing 17,000 financial advisors at Morgan Stanley Smith Barney branches access to social media sites such as Twitter and LinkedIn Corporation (NYSE:LNKD). This move comes after the investment bank said that it had tested out a yearlong trial with a small group of 600 financial advisors. The bank believes these social media sites are a modern day business tool in which financial advisors can reach out to more potential clients.
“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,” says Chad Bockius, CEO of Socialware, a site that has advised Morgan Stanley on social media.
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Morgan Stanley has been committed behind this new initiative that they believe can help not only find new clients but also better assist current clients as well. Goldman Sachs Group, Inc. (NYSE:GS) has seen the potential of social media as the bank has said that they are interesting in hiring a “social media community manager”. The Blackstone Group L.P. (NYSE:BX) has a Twitter account and AllianceBernstein Holding LP (NYSE:AB) allows access to LinkedIn.
This is a huge move for Morgan Stanley after the recent downgrade by Moody’s Corporation (NYSE:MCO) looked to hurt future profit potential. While the downgrade is a serious cause for concern, the fact that the investment bank is on the cutting edge of utilizing social media will greatly benefit them. Being able to reach out to potential clients and current clients in a very convenient, easy way is going to greatly help the bank during its difficult time, financially.
Once Goldman Sachs come onboard and the rest of the industry realizes the potential of using social media, more investment banks could jump on the bandwagon as well. While it could get quite competitive out there, this could be a little relief to banks that have been downgraded.
The bottom line here is that Morgan Stanley is quickly adapting to its new environment. The company’s tests have ruled the practice affective and I think this will really help the investment bank and its image. So far this the use of social media is not a widespread idea on Wall Street but that will soon change as other investment banks will see the potential success.
Disclosure: No positions