WASHINGTON—Asset management firms must have a presence on social media if they want to remain relevant to financial advisers and investors, speakers said at the Investment Company Institute’s “Using Social Media in Fund Communications” panel during the General Membership Meeting here.

But while asset management firms may not have as great an impact as some participants on social media, that could feasibly happen in the future.

“We wish our postings would go viral and we could be like Lady Gaga and Ashton Kutcher,” said Amy Dobra, a principal with Vanguard.  “We can’t all be like Charlie Sheen with his #winning hashtag. But social media, even for asset management firms, is for real.”

Alexander Garvis, vice president and associate general counsel at Fidelity Investments, said that while social media is currently dominated by a few large players, namely YouTube, Twitter and Facebook, which itself has an astounding  500 million users around the world, social media outlets will probably continue to expand as more people access information on mobile devices. Eventually, Garvis said, mobile devices will replace desktop computers.

A survey of the members of ICI’s communications committee in 2008 found that only 13% were using social media in 2008. In 2010, that rose to 45%. Today, 60% have a social media strategy.

Vanguard started using social media three years ago, when a number of senior executives recognized the rapidly rising popularity of the medium, Dobra said. “They noted that its purpose meets with Vanguard’s word-of-mouth approach, and that it’s a perfect complement to our strategy of ‘plain talk’ investing,” she said. “From the start, compliance, legal, marketing and business units worked together, which really accounts for our success.”

Vanguard started with just a blog written by its investment professionals, Dobra noted. The firm then began allowing investors to post comments after first reviewing them. “We were surprised by how really thoughtful and rich they were,” Dobra said. “Once we started publishing them, we found we really were connecting with our readers.”

At U.S. Global Investors, CEO and CIO Frank Holmes decided three years ago that the firm would have a presence on Facebook and Twitter, noted Susan B. McGee, president and general counsel at the firm. U.S. Global Investors decided to use social media to post educational materials on its gold and emerging markets funds, as well as to get its name out. The firm then added Holmes blog, “Frank Talk,” she said. Since then, it has attracted 1,400 followers on Twitter, 425 people have said they “like” the firm on Facebook, and Holmes’ blog not only gets 10,000 hits but 45 financial advisers post a link to it on their homepages, she noted.

Legg Mason uses social media to connect with advisers, the media and investors, said Mary Athridge, director of corporate communications at Legg Mason. Since Legg Mason sells exclusively through advisers, it developed a value-added campaign to educate them on how they themselves can use social media, called “Client Acquisition in a Wired World.” While Legg Mason currently does not allow commentaries, Athridge said, the firm its working with its compliance team to create two-way communications on the nine portals it built using Web 2.0 technology.