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Asked and Answered: How Social Media Can Take Your Practice to the Next Level
Monday, April 23, 2012
Partner Insights

Clients are using social tools to connect, share and explore the world in increasingly greater numbers. Last year, Fidelity Investments, in its annual survey of American millionaires, found that more than a third (34%) of today’s millionaires are using social media professionally and 85% are using it for personal reasons. Online and mobile social connectivity is now fully integrated into the modern way of life for your clients. If it is important to clients, it should be important to advisors, says Mike Langford, senior social business strategist at Socialware. Langford spoke to Financial Planning about a few main reasons why advisors should start connecting with their clients through social media:

Q: Where is the value to the wealth manager in using social media and being active on social networks?

A: Below are a handful of reasons why you should connect with your clients via social networks and become an active producer of social media.

  • They are sharing photos, videos and other updates about their family. One of the primary goals of the wealthy is to provide long-term security for their family. The more you know about a client’s family and the more familiar his family members are with you, the more likely you are to serve their needs to the fullest now and for generations to come.
  • They are sharing their life passions. It is likely common during the on-boarding of a new client relationship for you ask questions about a client’s passions. The logic being that you want to connect their dream life to the services you provide. Connecting with your clients via social networks allows you to have a profound level of insight into where their passions truly lie.
  • They are actively seeking information and solutions through their networks. In the “old days” one turned to his or her Rolodex and the Yellow Pages to find a solution to most challenges. Google came along and made finding information easier and tools like LinkedIn, Facebook and Twitter have made checking ones Rolodex about as common as typing a letter on a Smith-Corona typewriter. Connecting with your clients puts you at the forefront of their new go to resource.
  • They are discovering new things as a result of what members of their network share.  Your wealthy clients are human too, they are looking for new experiences, new products and even new friends. Social makes this process much easier than ever before. You have the opportunity to be the person who brings new richness to your client’s life by sharing the new things you discover and new places you find and connecting them with interesting people.

I speak frequently on the topic of social media usage by financial professionals. One thing I make a point of saying each time I am on stage is this is our e-commerce moment. Think back to what the rise of e-commerce did to any and all transaction based business. Amazon.com was mocked and derided for years on end but a decade later it is one of the most powerful retailers in the world. And now we have the rise of social media and social networks. What impact do you think these technologies will have on relationship-based businesses like yours?

As a takeaway, I urge you explore how your clients are using social media. You can ask them directly, send them an email or spend and hour poking around on Facebook, LinkedIn and Twitter on your own. What you find will likely surprise you and hopefully create a sense of urgency within you to become more social yourself.

(7) Comments
Social media can be a business-builder but there are strategic and compliance considerations. See our post on Common Questions about Financial Social Media at our fsmhandbook blog.
Posted by Evelyn E | Monday, April 23 2012 at 1:10PM ET
I agree with Mike that this is our e-commerce moment and in an industry where knowing your customer is not only a good idea but part of your responsibility as an advisor- social connection becomes more important and relevant. Our industry has challenges on the regulatory front, however the SEC and FINRA have been forthcoming on their expectations and it's up to the individual firms, broker-dealers and RIAs to determine their own social media policies. Early adopters are finding new ways to engage and connect with clients and prospects and those that do will leverage these relationships to drive new business. It's no longer a question of IF, but WHEN.

Victor Gaxiola @victorgaxiola

Posted by victor g | Monday, April 23 2012 at 1:42PM ET
Mike makes good points about the importance of connecting with clients via social media. As the social media manager for Nutmeg, a UK-based online wealth manager, I agree that our industry is in an "e-commerce moment". I think social media will become an increasingly important (and increasingly common) way of interacting with clients and prospects in the future. - Julie www.nutmeg.co.uk
Posted by Julie F | Tuesday, April 24 2012 at 10:41AM ET
Mike great points. I advise advisors to bring their books of business online. It is in their best interest to do so for the many reasons you have pointed out. If their client's aren't social, make them social, educate them on the benefits. It's a great chance to hold a client appreciation event, where you go over educating them on the benefits of social networks. For both personal and business use.

Great article! I love the Amazon comparison!


Rich LoPresti @RichLoPresti

Posted by Richard L | Friday, April 27 2012 at 9:54PM ET
Very attention-grabbing particulars you've remarked

commission vantage.

Posted by Anes A | Friday, June 15 2012 at 9:59AM ET
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