Advisors: Here's How Millionaires Use Social Media
Wealthy investors who consult with financial advisors are most likely to observe, share, comment and communicate with via social media by using Facebook, Snapchat and Twitter, according to a study by Spectrem Group. How wealthy investors use social media for financial activities also varies by how dependent they are on their advisors, according to the study, Using Social Media and Mobile Technology in Financial Decisions.
At least two-thirds of millionaire investors (those with a net worth between $1 million to $5 million) seek advice from a financial advisor in some way, whether it is for a life event, or to make all of their financial and investment decisions. Just over a third (34%), for example, see themselves as event-driven investors, which means they use an advisor for specific life events, such as retirement planning.
Event-driven investors make up the largest percentage of their advisor-dependent counterparts who are most likely to use Facebook, LinkedIn, YouTube and Twitter, as well as Pinterest, Instagram and Snapchat. Twenty-two percent of millionaires are advisor-assisted. While these investors consult with an advisor on a regular basis, they still primarily make final financial decisions. Thirteen percent of millionaires are entirely advisor-dependent. They rely on their advisors for all financial and investment decisions. The remainder are self-directed investors and do not rely on an advisor. (For related reading, see: The Ultra-Wealthy and Advisors: Why Relationships Matter.)
Millionaires' Social Media Usage
Millionaires who use a financial advisor in some capacity check their Facebook pages more than other social networks, Spectrem found. Thirty-seven percent of advisor-dependent millionaires check their Facebook page two-to-five times a day, compared with 22% who check Twitter the same amount.
Instagram and Snapchat are gaining steam as a social media platform most likely to be checked at least once and up to five times a day by millionaires who consult with an advisor, particularly younger ones. LinkedIn, meanwhile, is most likely to be checked less than once per week by about 60% of millionaires who consult in some way with an advisor. Millionaires typically check YouTube less than once a week or multiple times during the week, but not daily.
Wealthy investors who consult with financial advisors are more likely to follow a financial and/or investment commentator than they are their own financial advisor on Twitter.
Event-driven investors make up the largest group of wealthy investors most likely to obtain financial and investment information from—in descending order—Twitter, YouTube, LinkedIn and Facebook. (For related reading, see: Top Reasons Affluent Millennials Fire Advisors.)
Takeaways for Advisors
Spectrem points out the following suggestions for advisors:
Ask clients about their social media use, such as which platforms they use and how they use them, to see whether your own activities on social media are aligned with theirs.
Be consistent in posting social media content so clients get into the habit of checking for new material and information from you.
Twitter users who are wealthy are more likely to follow news, political and financial commentators than they are their financial advisor. Spectrem sees this as a wasted opportunity and suggests that advisors use Twitter to increase their visibility and credentials as an expert by posting links to their own commentary or sharing news they find useful.
In addition to advisor dependency, age is also a strong factor in the way millionaire investors use social media. In most cases, social media usage decreases with age, with the exception of Facebook. Across all age groups, Generation X makes up the largest percentage of millionaires who use Facebook. Review the age range of your target clients, and make sure your social media usage matches their preferences.
The Bottom Line
To make the most impact with clients, advisors should position their social media strategies to make sure they are a resource for financial information. How dependent wealthy investors are on advisors indicates how they use social media. Advisors looking to leverage social media should take note that overall, Facebook is the platform that offers the most potential to communicate with these clients.
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