Social Media gaining traction in Wealth Management Advisory space

financial advisors and social mediaThere are a lot of areas impacting Wealth and Asset Management firms – roboadvisors, disruptive technologies, social media, regulations, etc. One important area which is gaining significant traction is Social Media Engagement i.e. engagement of senior leaders and financial advisors on social media platforms. CEOs of financial firms often underestimate the flow of information and influence of social media, and they perceive it to be more for youth. Not anymore. Simply put: Social media is now too big to ignore.

Investors usage of social media for investing has increased …

End-clients are becoming tech savvy, are using social media a lot more for research on products, firms, read reviews before investing. Many existing clients are demanding that financial advisors leverage social media platforms to connect with them for faster, efficient, real-time collaboration and communication – more digital interaction.

Many of US consumers with investment accounts have profiles on LinkedIn, Facebook or Twitter.

Nearly two in three of mass affluent consumers take action after using social media to discover and consider financial products and services (Source: The DigitalFA, 2014)

Two-thirds of millionaires surveyed said they would like to use electronic media with their advisors (Source: The DigitalFA, 2014)

82% of clients trust a brands when its senior leaders are on social media (Source: GoSocial)

Financial Advisors are engaging on social media and seeing the impact

Advisory space is not just transactional business, but it’s relationship business and web/social media is evolving in their favor.  If the prospective clients are on Twitter, financial advisors need to be there.

Accenture Finds Social Media Helps Financial Advisors Retain Clients and Increase AUM

  • 60% have daily contact with clients through social media
  • 77% affirm that social media helps with client retention
  • 74% agree that social media helps them increase assets under management
  • 73% say it has led to an overall increase in client interactions
  • 40% indicate they have gotten new clients through Facebook
  • 25% have developed new clients through LinkedIn
  • 21% have earned new clients through Twitter

Cogent finds Wealthy investors use Social Media for Investing

  • About 34% of affluent investors specifically use social media such as Facebook, LinkedIn, Twitter and company blogs for personal finance and actual investing
  • About 36% said social-media research has caused them to reach out to their advisers to ask questions

Financial Firms must go where customers are — in essence, have a robust “Social Media Strategy”

Engaging on Social media helps firms increase brand awareness, generate leads, and increase traffic to their website. For Financial advisors, it improves client retention, it helps them gain referrals, find prospects and increase their professional network. It does make a difference!

Morgan Stanley pioneered the use of LinkedIn, when in 2012 it permitted advisors firm-wide to join the service. Now, many of MS’s approximately 17,000 advisors are on both LinkedIn and Twitter. What is the payoff? $70 million account.

Advisors should strive to include social media in their business models.

Social Media Strategy should include at least some of the following:

  1. Providing useful Insights, Thought Leadership materials over blogs
  2. Sharing of videos/interviews, podcasts, events, conference materials
  3. Product launches on social media
  4. Share product news, industry trends, and related information
  5. Monitor and correct any mis-information about the firm
  6. Customer Service (look at Charles Schwab dedicated customer service Twitter a/c)
  7. Drive trust, transparency, and reputation. Build relationship first, build will automatically come.

Drum roll please …..2016 Social Media Leader is …

…. Putnam Investments & it’s CEO, Rob Reynolds. Putnam Investments was named the first-ever recipient of the Social Media Leader of the Year Award at the 23rd Annual Mutual Fund Industry Awards ceremony.

With a corporate presence on TwitterLinkedIn,FacebookYouTubeInstagram, Google+ and blogs like Advisor Tech Tips and Financial Advisor, Putnam presents a balanced and humanized portrait of its brand to advisors and investors.


Financial Firms should encourage its senior leaders and advisors to engage more on social media platforms like LinkedIn, Twitter, YouTube among other channels. Additionally, regulatory and compliance departments should encourage advisors to get the firms message across social media rather than restricting with strict polices and guidelines. If financial firms don’t take leads, they will soon lag behind RIAs and independent advisors who have broader latitude.

The billions of new consumers on the market right now have never lived without social media. They are a social-first generation and will expect to find financial firms on these platforms as a default and not because firms are a cutting edge brand. Are you catering to Gen X and Gen Y and other groups?

Financial Firms/Advisors better start engaging clients now on social media vs. worrying about competition.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s