Much has been discussed about the availability of new socially oriented financial products for the retail audience, however even the very traditional institutional audience is beginning to tread into the area.

The retail world offers many examples of best practices. From great sites such as Mint.com, which can organize an individual’s financial accounts, to crowd-sourced investment ideas at the Motley Fool, there are a host of opportunities to gain from the wisdom of the crowd. Recently, Jeremiah Owyang from Forrester listed many retail examples.

Now the institutional side, more traditional and conservative, is beginning to adopt social media practices. No, I don’t expect Facebook and Myspace to have a many buy-side friend groups, however there is a deep interest in more meaningful interactions between investment managers and their institutional clientele.

Advisors and investors are looking for more contact with portfolio managers and members of the investment team. For example, the typical earnings call offers minimal capabilities beyond listening and getting in queue to ask a a question. Feedback is that they are typically too structured, too scripted, and question and answer sessions require too much time, or are of little value.

Research has shown us that analysts and decision makers want to interact beyond phone calls. They want to ask tough questions and physically see how the manager reacts. They want to be able to view it on their own time, and their own devices. They want to understand and learn from other people’s questions. They want to rank questions to make the most of their valuable time. They want to search for specific comments. Some want to offer feedback on the answers and others want to create an evolving dialogue.

In order to be successful, web-based interactions need to delicately balance corporate and legal compliance concerns with the vast opportunities that technology affords. Investment managers that don’t evolve their interactions risk perceptions of transparency and risk providing the conviction that investors need to recommend or purchase a product.