From 2005 through 2010, while social media use exploded worldwide, compliance concerns kept wealth management and other financial services firms on the sidelines. By 2011, regulators finally began issuing the guidance these firms needed to create corporate social media policies.
With the roadblock removed, the race was on among firms and their financial advisors to figure out how best to use social networks to drive profitable new business.
Industry statistics show that lots of progress has been made since then. Recent studies by Putnam Investments and American Century Investments, for example, show how quickly advisors have taken to resources such as LinkedIn, Facebook, and Twitter. In the Putnam study, 81 percent of the advisors polled said they said they now use social media for business purposes.
But using social media and using it effectively are two different things. A recent article in Fast Company talked about this difference, and the growing skills gap that is keeping companies and sales people (wealth management firms and their advisors included) from maximizing their use of social media to find and win new business.
It’s clear that in today’s market, having a LinkedIn profile, Twitter account, and Facebook Page and using them occasionally won’t ‘move the needle.’ To use these new channels to drive better top- and bottom-line performance in their practices, advisors need to boost their social media prowess.
Victor Gaxiola, senior customer advocacy manager at Hearsay Social, summed it up in a recent webinar: “Just having a presence on social media isn’t enough. You have to add value by sharing content.”
But what types of content should advisors share? How do they find the right people to share it with? What are the smartest and most efficient approaches? The answers all come from having a social selling mindset and plan.
But that begs the question: What is social selling? It’s having the knowledge, skills, and tools required to tap into the vast amounts of information that’s flooding into in social outlets. Every day, clients and prospects are on these networks sharing their thoughts, comments, questions, and concerns about every topic imaginable. For advisors, the trick is being able to filter, prioritize, and leverage key pieces of this information to engage prospects and clients in conversations.
What are some specific steps advisors and planners can take to shed their newbie social media status? Here are three activities that will put advisors and planners on the right social media path.
- Social Listening – By monitoring social media, advisors can keep tabs on what’s being said online about them, their firms, and the competition. That intelligence gives advisors openings they can use to start a conversation with a client, or make a ‘warm’ introduction to a prospect. A first step is to set up social listening keywords – the words or phrases that uncover relevant conversations already underway. Tools to meet this need include Hearsay Social, Radianz6/Salesforce Cloud, and Collective Intellect.
- Social Searching – With social searching, advisors can actively look for people in their extended networks who may be seeking advice, a referral, or an answer to a question about investing strategies or financial products. Tools for doing this typically blend traditional search capabilities with community filtering techniques to narrow down the results. A good place to start is with the advanced search capabilities provide by Google and Twitter. Other options include Bottlenose, which provides a search-based snapshot of what’s presently happening on social media, and Social Searcher, which is designed for use with Facebook.
- Social Prospecting – Going beyond listening and searching, this activity involves using tools that tap individuals’ connections and social spheres to create detailed and segmented prospect lists. One tool for this LinkedIn’s Sales Navigator, a paid service that produces recommended lead lists based on the user’s specifications. Another option is SalesLoft, which tracks activity with a lead or contact across different social networks, such as when a person’s job status changes on LinkedIn.
In addition to these baseline activities, social media veterans offer other helpful suggestions. One of these is for advisors to not try to be everywhere on social media, and instead pick their spots.
Kacee Johnson, founder of the marketing strategy firm Blue Ocean Principles, agrees. According to Ms. Johnson, “The best thing a financial advisor or planner can do to take their social media strategy to the next level is choose the platforms that attract their target demographic and stay active. A common mistake we see is people getting social accounts because they think they need to have them, but then they aren’t active on them which is worse than having no account at all. An inactive account gives the impression you are stagnant. Rather than try to be on all, master a few. And educate! Don’t just sell your services, social media is about creating a community.”
Another good suggestion from social veterans is to avoid being salesy, and instead be interesting and informative. Financial advisor Remy Heskett agrees with this philosophy. Says Mr. Heskett, “To be successful, show the human side of you that isn’t necessarily market-focused to show it’s not just a robot spitting out posts. Highlight great restaurants in the area, great family spots, or even places to travel. Suggestions that have nothing to do with their portfolio, and more about enjoying their lives, or how to utilize that portfolio when the goal is achieved.”
As it is in every other industry and market segment, social media’s impact on wealth management is already large, and it’s growing every day. To hold their own in the competitive advice space, and to grow their practices with sustainable and profitable new business, financial advisors need to work in social media channels effectively. For the many advisors who aren’t doing that yet, today is a great day to start!
