Understand that social media is here to stay, and that the only direction financial organizations and compliance regulators are going to move is forward. Adopting social media strategies now and educating yourself and your team will help you in staying ahead of the curve — and your competitors.
I attended a great webinar recently put on by Socialware: 2011 Year in Review: Social Media in Financial Services. Not only did
the webinar recap and discuss some of the key highlights and trends throughout 2012, including new regulatory guidance like FINRA Notice 11-39
and large firms announcing their move from prohibition to participation, but the webinar also showcased advisor stats that continue to show interest in social media to drive business.
These stats are what I’d like to share with you in this article — they showcase advisor usage of social media, the results they’ve achieved, as well as the obstacles that still exist. Let’s delve into these stats and discuss their implications on the financial services industry in 2012.
Advisor usage of social media
“It’s a must going forward if you look to be competitive.”
Advisor network use of social media
Breakout by sub-vertical
- Broker/dealer: 21 percent
- Holding company: 23 percent
- Life insurance: 28 percent
- Wealth management: 9 percent
- Asset management: 19 percent
What these numbers tell us is that financial advisor social media usage
is currently quite high, and Socialware’s quote regarding the need for social media to be competitive couldn’t ring more true to these statistics. If your audience and prospective clients are online, and if your competitors are online, what more do you need to convince yourself that social media is a driving force in the financial professional’s bag of marketing tricks?
As far as the numbers go for financial advisor social network usage, it’s no surprise that LinkedIn is the top dog of the networks. LinkedIn provides professional networking features like professional profiles, niche networking groups and company profiles.
Facebook is hot on LinkedIn’s heels, and for good reason: Facebook fan pages and ads have given businesses the ability to better target their specific audience and interact with them in new and more personal ways.
rounds out the networks on the bottom, most likely due to its predisposed reputation and advisors' lack of platform understanding.
“We need to be given access to these sites to protect our clients and gain new clients. If we don’t, someone else will.”
Stated that social media…
- …has made a positive business impact: 60 percent
- …generated new prospects: 34 percent
- …generated new clients: 17 percent
The question of measuring a return on investment of social media use has plagued financial professionals and marketers alike. These types of statistics help solidify the fact that whether or not there is a measurable ROI of social media use
, more than half of financial advisors stated that social media has made a positive business impact.
While social media has the ability to increase leads, generate new clients and thus make your business more profitable, social media should be looked at as a way to lay the foundation for these results, and not necessarily a way to generate a direct outcome.
“The social media policy at my current company is one major reason I am leaving it.”
- Lack of best practices.
- Lack of understanding of the compliance issues.
; the elephant in the room for financial advisors in the online world. I’m not surprised by the obstacles found in these statistics – compliance and a lack of understanding regarding rules, regulations and best practices clearly stand as obstacles for advisors using or trying to use social media.
The bright light at the end of 2011 and moving forward in 2012 is that more and more organizations that initially prohibited the use of social media are now allowing social media use for their advisors. They are providing education, guidance and changing the archaic rules that formerly ruled online interactions. Furthermore, external organizations are providing their own compliance help through best practices and compliance guides, as well as educational tools.
So what should you take away from these statistics that the survey compiled? Understand that social media is here to stay, and that the only direction financial organizations and compliance regulators are going to move is forward. Adopting social media strategies now and educating yourself and your team will help you in staying ahead of the curve — and your competitors
Also, while there are obvious obstacles standing in the way of social media use for financial professionals, understand that there are solutions. There are myriad companies out there advocating for the optimum use of social media in the financial industry.