Facebook is now more than 10 years old. It was the first social media site for millions of Americans, and it remains the mainstay social media site for many of those same Americans.
You may not realize that many affluent investors use Facebook to stay abreast of financial news. They check Facebook daily, sometimes several times daily, to stay aware of what is going on in the world, including in the markets and in regards to investment decisions.
Advisors should embrace Facebook as a communications vehicle within the firm’s compliance guidelines.
“Facebook is the most popular website in the world, and its value in terms of communications cannot be overstated,’’ said George H. Walper Jr., president of Spectrem Group. “Whether investors are reading print versions of stories from financial websites, or watching financial videos, Facebook is often where they are getting their information, and advisors need to be providing their own information on that medium.”
The value of Facebook comes not only from the dissemination of news and recommendations it can provide. It also comes from the fact that many Facebook users interact with their friends and family by “sharing” Facebook posts, and that act can provide a promotional vehicle for advisors and financial providers.
Initially, financial providers and advisors should ensure they have a Facebook page for their firm. They should encourage their clients to “like’’ their page, and then make certain their Facebook page is regularly updated so that investors on Facebook feel a continuing connection with their advisor, similar to the connection they have with their high school buddies who post pictures of their children.
According to Spectrem’s latest wealth segmentation series study Using Social Media and Mobile Technology in Financial Decisions, 58 percent of Millionaires with a net worth between $1 million and $5 million use Facebook, and that is by far the highest percentage of Millionaires on any of the most well-known social media websites. Investors with less wealth are more likely to be on Facebook, while those with greater wealth are slightly less likely to visit the website.
Facebook is most popular among Millennial and Gen X Millionaires, with 70 percent of Gen X Millionaires using the site.
Of those Millionaires who use Facebook, almost 70 percent go to the website daily as a minimum, and more than 40 percent go to the site more than once a day. More than 20 percent are active participants, sharing posts and videos with their own Facebook followers.
Advisors can provide the kind of information, via articles or videos, which their Facebook followers might want to share with others.
A great deal of information on social media is created to be shared. Financial firms or advisors need not create their own original material at all times. Often, financial experts provide articles or posts with educational information regarding investment matters that advisors can pass on by posting it on their own site.
Facebook can be used to attract new clients, and Millennial Millionaires are likely to consider an advisor or firm’s use of Facebook and other social media sites as communication vehicles in order to determine whether they use a particular advisor or firm.
Top Takeaways for Advisors
- Your current and future clients are likely visiting Facebook daily, and many of those investors are looking for financial and investment information.
- With the expanded use of Facebook by companies as a promotional vehicle, Facebook users are accustomed to seeing posts that promote business, and often interact with the businesses that post there.
- Facebook use is cost-effective. It requires little in terms of resources, and should be considered a free marketing tool for products as well as a recruiting tool for new clients.