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Advisors know that the business is increasingly technology-driven and that extends well beyond leveraging tech for back-office tasks, client relationship management and investment selection.
One area of tech advisors cannot afford to ignore is social media and that’s the case beyond catering to younger clients, though it sure helps to have a social media footprint when catering to millennials and Gen Z.
Point is millennials and Gen Z increasingly turn to social media – the wrong forms – for financial advice. That’s good and bad news for advisors. The bad news is plenty of folks in these demographics need to be talked out of bad habits. The good news is they clearly desire financial advice.
That’s one reason – an important one at that – for advisors to up their social media games. However, there’s more to the story.
Advisors and Social Media: It’s Not Just About Young Clients
Advisors are inundated with reasons to open lines of communication with younger clients and mine for new business among those demographics. Most of those reasons are sound. Still, advisors should take a broader view of the benefits of platforms such as Facebook, Twitter and YouTube.
The reasoning is simple. While avenues such as Instagram and TikTok cater heavily to younger users, the aforementioned trio have broader reach and are used by a wide variety of existing and potential clients across all age groups. Plus, data suggest use of social media is increasing.
“Recent quarterly releases from leading social media companies further substantiate growing engagement. For the most recently reported quarterly results, Meta Platforms managed to report 3.02 billion daily active users across its family of apps, up 5% year-over-year (YoY),” according to Global X research. “Snapchat, which runs a social messaging application, topped 383 million daily active users, up 15% YoY. Alphabet’s YouTube continues to be a leading platform in streaming time share, beating Netflix and other popular streaming video on demand (SVOD) services.”
When it comes to financial topics and investing advice, TV has long been a primary avenue for consuming such content with a quasi-monopoly on financial news enjoyed by CNBC. However, that’s merely the 60th most popular TV channel.
For advisors, all exposure is good exposure, but it’s time to reconsider past emphasis on linear television and print publications.
“Social also wins from the parallel erosion of legacy channels. Time spent watching TV in the US has been on a spiral decline, expected to drop another 17% YoY in 2023,” adds Global X. “Readership for newspapers has been on a secular decline, as well. The shift is even more profound in younger generations. Nearly 47.3% of Gen Z spends more than three hours a day on social media in the US, as TV viewership continues to shrink.”
Taking Lessons From TikTok
As noted above, TikTok isn’t the ideal platform for financial advice. It’s increasingly controversial and was even banned in Montana this week. That said, this social media channel offers advisors an important lesson: There’s value in pithy video content.
Advisors that take that approach don’t need TikTok. Twitter and YouTube are conducive to short, education-based videos. Advisors have good reasons to consider this approach.
“Lastly, we believe short video also offers an exciting segue into immersive content. As users continue to spend more time on social platforms, and embrace escapism, consumer tech will have to evolve to service emerging needs – accommodating immersive experiences, multi-modal input, intuitive interfaces, faster connections, and a new set of user demands,” concludes Global X.