Five Ways Financial Advisors Can Cash In On Social Media

Just as the social media giants are making gains in audience, you can tag along—expanding your sales flow in the process.

By Mostafa Razzak

Many people in financial services see social media as a simple broadcast platform, where messages, blog posts and other featured communications stick to a billboard as though they were press releases or boilerplate content that’s better than nothing. Others see it as a “time suck” that takes away from the serious work of doing business the old-fashioned way. But a number of recent studies show that social media produces potent results beyond the misconceptions, as it helps financial professionals fill sales pipelines, construct new ones and recruit fresh prospects.

A 2016 study by the asset management firm Putnam Investments, which surveyed more than 1,000 financial advisors, reached this conclusion: “Advisors ARE social.” The Putnam Social Advisor Survey found that 85 percent of advisors use social media actively—up more than 10 percent from the 75 percent tallied in 2014.

Among other key findings, the study found that “Effective use of social media by advisors is no longer controversial or unproven.” Thanks in part to better established compliance frameworks, “advisor social media use is growing in application and sophistication.”

Yet, how do those findings translate to bottom line gains in prospects and income? Four in five respondents say they’re recruiting new clients on the platforms, compared to 49 percent in 2013. That adds up to $4.9 million in average assets gained through social media, the survey found, with $1.9 million the median asset gain attributed to social media use.

Thus, if you’re not leveraging social media in a way that goes beyond the occasional Facebook post or retweeted news item, you’re missing out on a major opportunity to grow your business. Still, it’s never too late to incorporate social media into your sales strategy, even as you learn from the successes of other peers and pros. Here are five ways that you as a financial advisor can make social media work to your advantage:

  1. Look to LinkedIn, try Twitter later. As a business networking site, LinkedIn serves as a milieu where valuable connections are sought and made, so it’s accepted and understood that part of its purpose is to drive revenue for its users. Indeed, LinkedIn remains financial advisors’ favorite network, a preferred choice for 73 percent of advisors. On the other end of the spectrum, Twitter (though it has its role) appears much more of a longshot for building that crucial foundation. Whether because of its high “noise floor” or low content allowance (just 140 characters) Twitter isn’t nearly as popular. While 44 percent of advisors are on it, only 12 percent use it as their primary business platform.
  2. Find momentum with Facebook. After LinkedIn, Facebook is picked as a favorite by 54 percent of financial advisors. That might seem like a significant gap, but that doesn’t mean Facebook isn’t gaining in advisor value. In 2014, its percentage of preference was just 36 percent. Meanwhile, Facebook’s monthly active user base is growing at a rate far greater than that of LinkedIn. It’s closing to hitting the 2 billion mark in 2017, compared to 1.55 billion in September 2015.
  3. Build your brand: Become a thought leader. In a crowded field of both financial advisors and advisors using social media, how does someone stand out? Simply put, content that shows you off as a thought leader works to make you stand head and shoulders above the rest. That said, you’ll want to consider taking a direction that gets you noticed. Humor, writing style, and cutting through jargon the average investor can’t grasp will win major points with prospects; the same with smart videos presented on your own YouTube channel. If you don’t feel up to those tasks, consider recruiting freelance help or a consultant to give you a hand. (You didn’t think CEOs write their own speeches, did you?)
  4. Multiply your social media with social media. When you post to Facebook or your own LinkedIn blog, that’s far from the end of the story. Drive people to your social media platform by using social media itself to promote it. Use LinkedIn’s “share an update” feature to alert people in your network; use Twitter to direct them to your newly generated content; embed your latest YouTube video into your Facebook page.
  5. Watch—and learn from—the pros. Effective social media manuals may not exist yet on a widespread scale. But, you can study those who know the turf, competitors and colleagues alike, to get a sense of what works and generates healthy traffic. It’s a challenge to make the time to do this: We’re talking not so much filling your pipeline as building a brand new, supercharged one. The good news is that once it’s up, you’re ready to benefit handsomely from the digital present, and launch healthy growth efforts to carry you far into a profitable future.

Mostafa Razzak is CEO & Principal of JMRConnect, a multi-national public relations and strategic digital communications firm. Mostafa is also the Mid-Atlantic Chairman for the Internet Marketing Association

Mostafa Razzak

President and CEO, JMRConnect

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