The FCA’s guidance paper
on financial promotions in social media largely states that the comms rules of old still hold sway, regardless of medium.
That said, the report does acknowledge that the idiosyncrasies of social media – particularly the character limitations of microblogging sites – present unique challenges for financial firms when it comes to compliance.
So what are some of the key learnings from this paper?
Clear and concise messaging but don’t forget the small print
The overarching principle behind financial promotions – that messages must be fair, clear and not misleading – reigns supreme. However, social media carry unique implications on this front.
More so than with traditional media, messages can very easily find their way to non-intended recipients.
As such, firms using social media are wise to ensure that their comms are fair, clear and not misleading regardless of the recipient.
Simply slapping risk warnings and statements on to the promotion is not enough. The FCA uses an example of an online banner ad that buries risk warnings amid a bevy of ‘small print’ at the bottom.
These statements must be given due prominence, important to consider when crafting social media messages, which often come with strict limitations on characters or spaces.
The FCA asks firms to consider whether microblogging sites are suitable for complex financial offerings due to the character limitation. This issue is only exacerbated by the standard risk disclaimers and warnings that must accompany certain types of financial communication.
Twitter’s character limit does not absolve firms of the need to include these. As it is almost impossible to include them in the tweet, then perhaps the tweet should not be tweeted at all.
Promotions must be clearly labelled as such.
The FCA recommends the use of #ad on Twitter to err on the side of caution.
One word can make all the difference: "Come see our great mortgage offers: [link]" is non-compliant, whereas simply removing the word ‘great’ would render it compliant.
This plays into the information vs inducement divide: it may be that Twitter and co are simply more suited to purely informational communication rather than promotion or selling.
Images the way forward?
The FCA observes that the use of images can be a good way to circumvent the compliance challenges of a minimum character limit on sites like Twitter.
Infographics are gaining popularity as an effective means of communication as attention spans shorten and people struggle to find the time to read heavy text.
The FCA note is welcome, and helps provide much needed clarity regarding the dos and don’ts of compliance on social media.
The overall picture that emerges is that Twitter et al are as acceptable a medium for financial communication as any other.
This is with the important proviso that – in general – the medium lends itself to the simplest forms of promotions, and that social media are perhaps better used to inform and engage, rather than promote and sell, given its constraints.
Katy Galasinski is head of financial services at Aspectus PR