Written by Bruce Milne | Socialware
“Half of the time I don’t know what they’re talking about…I’m a foreigner in the world and I don’t understand the language.” — Jean Webster
That quote perfectly summarizes what I’ve heard countless times at industry events and in one-to-one conversations with financial advisors when discussing the notion of using social media for business in financial services.
The rising influence and role of social media within the financial sector is plainly evident to anyone who has followed adoption trends since their tentative and skeptical beginnings to today, where we see major institutions announcing widespread social programs involving thousands of financial advisors.
It makes good sense. According to a 2013 study by Cogent Research, 34 percent of wealthy investors use social media such as Facebook, LinkedIn and Twitter for personal finance decisions. Seven out of 10 said they have changed their relationship with an advisor or reallocated investments because of something they read on social media. About 36 percent of respondents said social media research prompted them to reach out to advisors.
Different Views of Social Media among Advisors
With social becoming the norm at many firms and more than 90 percent of financial professionals now stating they are actively participating on at least one social network, we’re beginning to see an interesting bifurcation of social financial advisors. Disclaimer: these are generalizations, but I’d argue empirical as well as anecdotal evidence suggests most advisors fall into one of these two camps.
The first group, which I’ve grown accustomed to calling “Generation Connected,” or Generation C for short, deserves credit for driving social adoption, both at an advisor level and at an institutional level. Perhaps the word “generation” is misleading though, because while of course many of these connected individuals are from a younger demographic that grew up with an “always on” mentality, we are seeing professionals of all ages fully embrace the idea of constant contact. They tend to share several attributes as it relates to social media usage:
The second group you could refer to as “Digital Newcomers.” Again, this isn’t about age or generation as much as their digital inclination and their eagerness to dedicate a significant amount of time to learning new technologies or methods of communications. These are the people who still prefer to call instead of text. This group tends to think about social media through a different lens.
I fully expect social media adoption to continue to grow exponentially within both groups, as more firms feel comfortable with existing regulations and the technologies that are now available to mitigate their compliance risks. For most firms, understanding how to effectively enable advisors from both groups is critically important so that each is able to participate in ways that feel comfortable and lead to tangible results.
Remember, there’s no single right way to participate on social media, but not participating at all is a surefire way to miss out on the opportunity. You’re guaranteed to miss 100 percent of the shots you don’t take. The advisors who use social media aren’t necessarily better at earning money for their clients, but they are much more likely to win new clients – quite possibly from the advisors who are absent from social media.