Social media gets a lot of flak—much of it arguably deserved. The incessant food pics and overabundance of political rants can make scrolling through [insert platform here] daunting. But new research shows LinkedIn, Facebook, Twitter and so on can be genuinely useful for advisor prospecting and business.
The latest Putnam Investments Social Advisor Study found that the vast majority of financial advisors are utilizing social media in some way, whether to communicate with current clients, acquire new ones, handle everyday business or minimize the number of in-person meetings clogging up their calendars.
Impressively, 86 percent of those surveyed who have incorporated social media into their practice said it helped them land clients.
“Advisors today are increasingly using social media as a tool not only to communicate with their clients and prospects, but also to deepen and evolve their ongoing relationships with clients,” Mark McKenna, head of global marketing at Putnam Investments, said in a statement. “These professionals are also finding that leveraging both the business and personal sides of social media enables them to more easily connect with current clients and attract and develop new business.”
Of those who have acquired clients using social networks, nearly nine out of 10 said interacting in this manner has “changed the nature of their client relationships a ‘great deal’ in a number of ways.” For them, social media has led to:
- Greater ease in sharing information (67 percent agreed)
- More frequent communication overall (59 percent)
- Improved professional relationship with clients (54 percent)
- Better personal relationship with clients (47 percent)
- Faster and easier decision-making (50 percent)
Moreover, advisors who report no use of social media—whether business or personal—have an average of $69 million in assets under management, whereas those who use it for business have $89 million. And “advisors who use social media only for personal reasons have on average $85 million in assets under management, suggesting that even a casual social media presence may result in additional business,” according to Putnam’s report.
Hands down, the “social platform of choice” among advisors is LinkedIn (73 percent), followed by Facebook (56 percent) and Twitter (46 percent). Lesser used networks include Yelp, YouTube and Instagram.
“Over the past five years, we have found that LinkedIn’s share of net business use has flattened among advisors while the use of every other network for business has grown,” added McKenna.
“LinkedIn remains a critical tool, as its user demographics and rich, indexed data are unique compared with the other leading social media platforms. LinkedIn provides a concentrated network of college educated and relatively affluent users, making it the best place to qualify leads, obtain referrals and begin the process of converting prospects. However, advisors are conducting day-to-day social media business on other platforms.”