Seventy-nine percent of financial advisors said that they gained new clients via social media last year, according to a recent survey by Putnam Investments.
The survey also found that $4.6 million was the average asset gain for advisors who used social media. Out of those who gained, 71% were active on a daily basis.
But simply being active on social media each day is no guarantee of success, advisors and social-media strategists, say.
“Advisors need to customize their strategy and be involved, at least at the high level,” says Stephanie Sammons, a former wirehouse executive who counsels advisors on social-media strategies. “It’s amazing the difference in results that makes; it’s huge.”
In order to differentiate themselves, advisors should infuse their personalities and passions into social media, says Sammons, who founded her consulting firm, Wired Advisor Digital in Dallas, in 2010.
“So many advisors want the quick turnkey system where they’re not doing anything, but if it’s generic, it’s not effective at all,” she says.
Sammons cites an example of an advisor who turned to a ghostwriter to produce content on a regular basis and to promote it on social networks.
“But the advisor didn’t want to be involved,” she says, so when he started getting online feedback, he was shocked at the responses and disappointed by the prospects he heard from.
“When he started really looking at his content, he said, ‘This this is not at all what I want to be putting out there,’” Sammons says. “It was attracting lower-end clients, rather than wealthier ones.”
Once the advisor took over his own content strategy and became involved, the number of incoming relevant leads increased by 40%, Sammons says.
“Advisors just can’t turn a blind eye to this and expect it to work,” she says. “They don’t have to do the writing or manage the social-media channels themselves, but they’ve got to be involved.”
At the same time, advisors need to be smart about defining who they want to reach in their social networks and tailor their plans accordingly.
“Social media is simply an extension of your offline networking strategy,” says Josephine Ha, senior vice president of wealth management at Northern Trust.
“Think of it as a round-the-clock business card.”
Social media is also a way of keeping in front of clients, prospects and colleagues. It shouldn’t swallow up vast amounts of time, but it shouldn’t be ignored, either.
It is important not to treat social media as an afterthought, Ha says.
“If you can spend a few minutes every day keeping your connections up-to-date on what you’re doing and expanding your network, it’ll become part of your routine and not a chore,” she says. “It’s never going to come before my other responsibilities in my day, but if it’s something I carve out 15 minutes for each morning, I have to remember it’ll help me get virtual face time with every person in my network without ever having to leave the office.”
Paul Hechinger is a New York-based freelance writer.
This story is part of a 30-day series on how to prosper as an advisor.