Back in 2010, there was a dark cloud of skepticism hovering around social media
— especially in the financial services industry. At that time, many advisors and financial professionals I spoke with struggled to see the value in social technologies like Facebook, LinkedIn and Twitter. Three years later, I am ecstatic to see how the financial industry has grown to integrate social media into their marketing budgets and find real value in its use.
In addition to acquiring more leads and developing thought-leadership, advisors are using social media to retain clients and rebuild an eroding trust with Gen D: an emerging U.S. investor population, where the D stands for digital. This heterogeneous group — which spans multiple demographics and represents more than 75 million people with $27 trillion in assets — is differentiated by their broad adoption of technology
, particularly in their deeply ingrained use of digital and social channels in almost every aspect of their lives.
Accenture, a consulting, technology services and outsourcing company, recently conducted a study with 400 financial advisors to examine the existing relationship between Gen D investors and financial advisors. Check out the two graphs below which illustrate the existing relationship-perception gap between advisors and Gen D investors.
Wow! Who is alarmed right now? Luckily, the study found that the gap between Gen D investors and advisors can be minimized or even remedied through social technologies. Here are some important stats about how social media has helped advisors rebuild trust with investors:
- More than half of advisors acknowledge their clients want, or even demand, digital interaction.
- While most financial advisors acknowledged a number of benefits to using social media channels, the top reasons cited included:
- Getting answers to clients quickly and easily (59 percent)
- Increasing their touch points with referral sources (58 percent)
- And keeping up to date on industry news (58 percent)
- 77 percent of participants affirm that digital interaction helps with client retention.
- 74 percent agree that it helps them increase assets under management.
- 73 percent say it has led to an overall increase in client interactions.
- 40 percent say they have gotten new clients through Facebook.
- 25 percent say they have gotten new clients through LinkedIn.
- 21 percent say they have gotten new clients through Twitter.
- 60 percent of advisors surveyed who were active on social media had client portfolios over $20 million.
Alex Pugliucci, global managing director of Accenture wealth management services, states, “Firms will have to recruit and train advisors on the basis of their ability with social media if they are going to survive the generational change when millennials will become increasingly important as both advisors and investors.”
Given the growth of social technology, I couldn’t agree more. Don’t want to lose trust with investors? Then use social media as a trust-building tool