The Key To Social Media Success In Regulated Industries
The Key To Social Media Success In Regulated Industries
The Key To Social Media Success In Regulated Industries

If you were following along at the old personal blog last week, you know I visited Bangalore, India. There I spoke to a global conference about social media in regulated industries.

My talk dove a bit deeper into the subject matter than I have before and while the research and topic was fresh on my mind, I thought it appropriate to share a takeaway I distilled out of all the preparation work. There emerged for me a common thread in analyzing industries like banking/finance, health care, pharmaceuticals, non-health-related insurance, firearms, tobacco, alcohol and publicly traded companies.

The problem marketers and companies have with social media for regulated industries is not tied up in the regulations and laws that need to be followed, it’s taking the time to develop policies and procedures that achieve social media marketing efforts while embracing the rules.

Social Media Policy Templates - Social Media Policies ToolkitI’ve said before that good attorneys don’t just say, “No!” They find a way, within the rules, to say, “yes.”

No is easy. No doesn’t take effort. Yes, on the other hand, means someone will have to research. Someone will have to write. Someone will have to educate and train the staff. Someone will be accountable.

The next time you’re facing a skeptical executive or suspicious attorney, keep that in mind. You are making them work. Illustrate ways the rules can be followed but you can still have your idea. Blog comments bother them? Write an air-tight moderation policy and procedure. Real-time interactions without filtering bother them? Propose the PR or legal team member who is enthusiastic about social media be responsible for immediate responses until they’re more comfortable with you doing it.

Better yet, unless your audience is inordinately engaged in Twitter, that the real-time platforms like it off the table and baby step your way to that point down the road.

Remember, it’s not the rules that are hard on you. It’s the willingness to work to find a path to performance within them.

True? Not so? The comments are yours.

NOTE: Policies toolkit advertisement is an endorsed product of Social Media Explorer. It is an affiliate link. Enter “SMEVIP” to receive $50 off.

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About the Author

Jason Falls
Jason Falls is the founder of Social Media Explorer and one of the most notable and outspoken voices in the social media marketing industry. He is a noted marketing keynote speaker, author of two books and unapologetic bourbon aficionado. He can also be found at
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  • Hey Jason. I think one of the biggest mistakes made when communicating with those in regulated industries is boasting on the success stories of others, NOT in that industry. I work with a lot of clients in regulated industries. In fact, that's most of what I do at my agency and stories about Starbucks, Dell and Ford don't do it for them. You have to dig deeper, find others in the industry and show some examples. I'm telling you, I write just as much if not more than I did as a journalist doing this work because you have to speak the language and give it to them in ways that resonate. I love your examples, particularly the one about writing moderation policies to ease fear. I did this when working at, and those procedures are still used by the moderators now that I'm gone and the comments area is always robust.
    I know we all say this but the fact that this work isn't on-size-fits all is important to understand, and original thinking is a requirement for anyone who wants to do well.

    Angela Connor
    Author, “18 Rules of Community Engagement”

    • Agreed, Angela. There's nothing that tells a marketing manager you can do it

      better than an example of someone just like them that can. Problem still is

      that many regulated industries aren't doing anything worth bragging about

      yet. The examples are getting more and more populated, but compelling is

      still a stretch in many instances.

  • Stephen

    I find this topic very interesting. My father is a financial advisor. In that industry he is neither allowed to have a personal nor business page, he is not allowed to be on Twitter and I'm pretty sure he isn't even supposed to have a blog. The financial industry goes beyond rules and is more focused on surveillance. It is not unlike living under a communist regime to some extent. The only way that industry will ever embrace social media is if someone comes up with a platform that will allow their pages to be scanned. When he launched a website, he had a list of hosts he could go through, had to use a template and the host has its own compliance officers that read and approve every change before it goes live. Marketing mailers follow the same rule; having to be emailed in to his broker dealer, reviewed and approved before they are utilized. That is what they are up against. I would love to hear your thoughts on how to address this.

    • Honestly, it sounds like the parent company your father is involved with is

      about to be faced with change or die. They can't continue to hinder the

      direct communications with customers and expect to remain competitive. It

      will take someone in that organization (not recommending it be your father,

      but it could be) to ask forgiveness rather than permission and break the

      rules with astounding business success to show for it.

      Or the company will get bought, change its policies and procedures and dig

      itself out of the hole.

      Wish I had better prospects for you there, but when they are that untrusting

      of their employees, the problem isn't with their marketing. It's with their


  • I love the dialog here … and love the timing, since I'm moderating a panel at BlogWorld Expo called “Social Media in Regulated Industries.” I think that there's been a lot of good dialog here, so I'm not going to reiterate it. The one thing I'd add is that it's not just the regulations themselves that cause companies to behave differently.
    When your company is regulated, it means that there can be (sometimes dramatic) consequences when you cross a line (and as Jaime Punishill pointed out, it's often unclear exactly where those lines are). If that is your reality, it's pretty natural to create both internal structures and a culture in which risk mitigation is the highest priority. I remember seeing a sign on the wall of a pretty senior IT person – it was her only decoration – that said “Don't Do Anything Stupid.” Not exactly a formula for engagement and innovation.
    The point is that policies and guidelines are important. They're good. They help. But changing basic organizational structures is hard, and changing cultures is even harder – and both take time. It requires a coordinated, organization-wide approach, and making a conscious concerted effort to do so. It's definitely do-able. And people definitely use regulations as an excuse. They hide behind “no.” But none of that can obscure the fact that making these kind of changes is a big deal.
    In my experience, the thing that makes the biggest dent is to stop focusing on what you CAN'T do, and focus on the things that you CAN do. Find your feet. Get some early wins. Then move on to tackle “The Big Stuff.”

  • I think this is where having a social media policy really works. Many businesses make the mistake of dabbling into social media, without one – then, complain later about a rotten apple infecting the whole bunch, simply because they have forgotten. I like your insights here.

  • it’s not the rules that are hard on you. It’s the willingness to work to find a path to performance within them – true, rules are somehow permanent and you have to deal with it.

  • Oddly enough, I think the most powerful thing you said wasn't about regulation at all. I think your point that “No” is easy but “Yes” takes work is key. This is true with every job, profession or industry, not just lawyers. I remember at my first job, my boss wanted me to research if something would be possible on Facebook. My initial thought was “No,” but then I realized it was probably a “Yes,” if I could figure out a way around Facebook's Fan Page structures. There is always a way, you just have to find it.

    • Glad to be useful. Thanks for the comment.

  • Great article on social media success Zemanta.

  • Jason, nice start to a sticky subject. As the guy who wrote or edited (or more correctly whose team wrote or dited) much of the policies that it took to get Citibank off the ground in social media, I can tell you first hand this is tough stuff for three prime reasons:

    1) The regulations are gray at best, and more light gray than charcoal. The regulators — to their credit — are trying not to pour concrete in a way that will stifle the use of the new mediums

    2) Almost all the regulated industries are in fact regulated because they screwed people at one point or another. The regulations are written from the premise that the consumer needs protection from untoward business practices. Many of them, to Liz's point, were written as long as 80 or 90 years ago. While i agree that folks in these spaces CAN & SHOULD be utilizing these mediums, the regulations do very much limit the what and the how.

    3) In all cases, these industries are held to higher standards than others. It's one thing if a CPG company is less than forthright about the claims of its products. No one really gets hurts if the Sham-wow doesn't absorb all that water it says it will. Its quite another for a financial advisor or a pharma co. to do the same — the stakes are higher. So the limitations and the risk aversion on the part of these companies is significant, real, and warranted.

    4) Related to the first 3, the COST of participating in social media for these firms is MUCH MUCH higher. As an example, in the wealth management business every tweet will have to be archived for easy and consolidated retrieval for 7 years. WORM storage aint cheap. So the regulated industries start the sprint with an aircraft carrier tied around their waists.

    Is easy for folks to pan (and to be clear, I am not saying you have here) the regulated industries as slow, intransigent, uninnovative, resistant, backward etc but that just reflects a fundamental misunderstanding of the extra challenges these firms have to operating under the burden of regulations.

    On the good news front, there are a lot of smart people thinking about this and working to help get these industries into firm embrace of social business. In fact, there is a blog world panel on this very subject this week. Looking forward to a hearty debate.

  • kmskala

    When it comes to the financial space, I don't think it has anything to do with regulations or writing policy to be in compliance. When it comes to finance, it's purely the fact that very few organizations have changed their way of thinking. They are still stuck on selling every product to every customer and still do it in a way that attempts to “push” content out. Those that are doing it well (e.g. American Express) understand that the rules have changed and they are thinking in broader terms that “pull” content that's relevant. In my opinion, it has little to do with regulations.

    • While i don't disagree with your sentiment that firms are still very sales/push oriented, I think you are grossly underestimating the regualtory burden, and the risk aversion inherent in regulated industries precisely because of the high stakes issues at hand, i.e. people's lives or financial well being.

      • kmskala

        I think regulation is the worst excuse a financial institution can give for not being involved. You look at the firms that are doing it well – American Express, Cisco, CME Group – all have taken the “regulation” excuse and tossed it out the window. Regulation is no longer a valid reason for not being involved or being cautious. Having spent five years in the financial space, I understand the importance of compliance. However, it's no longer relevant in terms of avoidance and skepticism.

        • I never said they shouldnt be involved. but saying its a bad excuse is like saying lack of oxygen isnt a great reason to stay above water. Cisco is not a regulated institution, and while Amex Open social site is awesome, the rest of their social efforts haven't been earth shatteringly good. Average at best as a matter of fact. Can't speak to the CME. your assertoin that regulation is not a valid exuse for being cautious is at best naive. The regulations are only getting more difficult and more restrictive in the wake of the financial crisis, not lessensed. Firms have even MORE reason to be fearful of being burned by their entry into social media.

          And while your 5 years surely makes you you more aware than most, I am pretty sure my 17 years, 3 licenses, and experience across insurance, banking, wealth management, and mortgage divisions gives me a tad more perspective. You also wouldn't recall then, that the this isn't the first new technology where people excoriated the financial institutions for being slow and cautious (myself included) and when they did enter they were burned by the regulators. Example: It took the SEC and FINRA (then the NASD) to come up with clear written regulations for how to treat email, which was a gray area under the existing regulatory enviroment when email hit the scene in the early 90s. It is neither an oral communication, nor strictly speaking a written communication. So firms had no idea how to supervise or control it. Sure enough, when the regulators finally did write the regulatoins in 98 and 99, they then tried to prosecute firms for not having had proper controls up to that point. So you see, firms face real consequences for wading into an unclear regualtory enviroment. Furthermore, the technology required to monitor, supervise, archive, moderate, and so on is ismply too nascent and not yet scalable or robust enough for most FIs to rely on. It will get there, and when it does so will they.

          Nobody is a bigger proponent of social in financial services than me. And having been the trailblazer who ld the effort at Citi, I can speak first hand for what it takes to actually do this in real life, not just in a powerpoint presentation. And it is simply irresponsible and naive to imagine this is easy, without risk, or more importantly, that the ROI of the effort to do this well and compliantly is worth the business lift. The cost for these firms to execute is many times higher than most enterprises, because of the necessary controls. It is simply not a slam dunk.

  • Being in the haz, nuclear and rad waste packaging industry, the problem I am finding is not in the regulation but getting the response, and flow of communication because of the thought of social media “as a play thing” within heavily regulated governmental agencies, or those agencies who deal with “secret” jobs. At our company we don't have many that actually participate in Social Media, partly because they don't have time. The problem of fast growth, with few employees doing multiple jobs kinda thing. Trying to monetize social media in the environmental industries is tough because the market (the engineers on site, purchasers in the office . . .) don't see the validity of a relationship developed in SM.

    • Good points. It might be that those industries will lag until someone can spell out clear business reasons and use cases for social media. Which gives you a golden opportunity! Good luck.

  • Jon

    Some solid arguing, what are your thoughts on the adult industry and social media? Or is that one of the regulated industries you'd rather not get into? :)

    • I'm all for it! Heh.

      Actually, the governance of the adult industry will likely lag and be rough to say the least because the adult industry is one of the few left that has enough less-than-ethical marketers in it who will push the envelope until they're told not to. In other “sin” industries (tobacco, spirits) the marketing regulations and law suits over the years have forced out the underhanded mindset. I've been quite surprised, and even shocked, at the level of ethical standards I've seen from tobacco and spirits in my time. The adult industry, though, and to my knowledge, really just gets away with everything it can until the government tells them they can't anymore.

      Yeah, there are some adult industry companies and marketers out there who are steadfast about not marketing to children, etc., and we appreciate that, but if any industry is a wild west, it's that one.

      I'm sure friends like Kelli Shabari can add more to this question than me. And I have very little exposure to the adult industry, so I'm probably speaking out of turn.

      Good question, though.

  • Jason I have a lot of respect for you. But this is oversimplified. You've left an important player out: the regulating body. I know healthcare and I know pharma. I've spent my entire career, save for six months, in the healthcare field, either as a writer, reporter, marketer or consultant. Right now, the huge bureaucracy that is the FDA is attempting to sort of social media for the pharmaceutical companies that it regulates. Sure, they can start to make internal rules and train staff out the wazoo. They can allow their internal regulatory boards to say “yes.” But until the FDA decides what will fly and what will not, the companies will be spending a lot of time and money dodging bullets, money that might be better spent elsewhere. The path is hardly as straight as you have characterized it, at least in the healthcare environment.

    • I love the ones that start off with “i have a lot of respect for you, BUT.” Heh.

      Appreciate your perspective. I didn't leave out the regulating bodies. The decision-makers don't have black and white guidelines from them, so for now, they must approve or disapprove social media marketing based on precedent in similar efforts (advertising, PR, etc.) or instinct in anticipation of what the regulating bodies might one day decide. Yes, there are plenty of companies sitting on their hands and waiting for the regulating bodies to publish the “rules” for social media, but those companies are A) Falling behind their competitors and B) Not innovating.

      I'm not saying every company should dive in and run roughshod on the social media world until the rules are defined. I'm also not limiting a companies social media marketing to selling their particular product or service. You can use social media for a lot of things.

      Pharma? GlaxoSmithKline has Healthcare? Humana has twitter customer support, a health technology blog and video contests for Humana Games for Health. I promise you no health care governing body has decided what the rules are for conducting video contests to come up with crowdsourced ideas for new video games related to the health care industry.

      My post isn't oversimplified, it's just intended to be more broad than perhaps you're focusing.

      But then again, you can't boil down regulated industry social media into 300-500 words, so a little simplification is expected.

      Thanks for the push back. I always enjoy learning from other perspectives and experiences.

      • Excellent points! True that there are a few pharma cos. that are taking baby steps and putting their toes in the water. And also true about not innovating. But then again, most of pharma is stuck in the 20th Century when it comes to marketing anyhow. And as you aptly point out, SM is not just about selling a product. Thanks for pushing back as well – I enjoy the conversation and being challenged.


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