Social media is not just for kids any longer.
Whether it be Facebook, Twitter, YouTube, Snapchat or Instagram, social media sites have become a haven for corporate interests and businesses of all sizes to promote their products and services. Social media users have become accustomed to such ploys, and for the most part don’t seem to mind.
In fact, affluent investors are now using social media as a way to educate themselves on financial matters, and want more information available to them in the form of articles, blogs and videos.
While regulatory concerns affect how much information a financial provider or advisor can post to social media sites, it would be wrong for any investment firm to ignore the potential social media provides in terms of promotion of products and services and connection with clients.
“Social media is a low-cost tool financial providers and advisors can use the same way they have used hard copy promotions in the past,’’ said Spectrem president George H. Walper Jr. “At the same time, social media is a communication tool that invites comment and questions from investors. It’s a win-win scenario, but one that firms must stay on top of in order to make the most of the opportunities social media presents.”
LinkedIn has always had a business focus, but other social media sites are catching up. Facebook has clearly turned its eye toward the corporate world with ads and video presentations. Once YouTube caught on with the public for cute kitten videos, corporate America jumped on and now presents its own videos and commercials immediately available to the public on that site. Snapchat, once the domain for quick photo and video presentations that disappear in a matter of seconds, is now hosting corporate posts as well.
Twitter has carved out a niche unintentionally as the site consumers go to in order to make complaints directly to companies. Most major corporations have staff members whose job it is to monitor social media complaints and jump on them immediately to make amends, in some cases doing so very publicly.
Financial providers and advisors can do the same. Asking clients to “like’’ your Facebook page will lead them to receive informational posts from your firm the moment they get posted. Twitter can be used proactively with articles, blogs and videos. YouTube, the site most investors turn to if they are looking for financial information in video form, offers companies their own “channel” and can promote that channel to their clients.
In fact, it is nearly impossible for financial providers and advisors to do too much in regards to social media. If you believe your firm is doing all that it can in that regard, look it over again and think outside the box.
Spectrem’s wealth segmentation study on investor involvement in social media details how important this step is for financial advisors. Using Social Media and Mobile Technology in Financial Decisions details what investors use social media for in regards to their financial decisions, what they want to see on social media sites from their advisors, and which sites they most often use for special financial purposes.
For example, 50 percent of Ultra High Net Worth investors with a net worth between $5 million and $25 million are on Facebook, and 55 percent of them check Facebook daily. That provides a minimum of one daily interaction with your clients.
YouTube is another good example. Thirty percent of UHNW investors visit YouTube, and among those, 70 percent watch financial videos. Many of them express an interest in seeing video presentations from their financial advisors.
It’s an invitation to be involved with your clients, and it would be rude, not to mention unwise, to turn down that invitation.
Top Takeaways for Advisors
When it comes to their relationship with advisors, communication is very important to investors. Social media is another form of communication. There are also some investors who prefer to communicate with parties outside of friends and family through social media, whether it is through Facebook posts or tweets on Twitter. This is a part of an advisor’s relationship with investors that cannot be ignored.
There are various forms of social media posts. Articles and blogs are written word forms, videos are another. Different investors prefer different forms of posts, as some investors watch only videos and others prefer to read their information. Advisors should consider all of those different investors in creating your social media material.
Consult with your compliance department or team to determine the best way to approach specific social media posts. While advisors should be aware of company standards, there are unique circumstances that come up all the time in terms of social media communication and anything out of the ordinary needs to be vetted.