Remember being a child and playing in the snow? It was always amazing when one little snowball, shaped by your hands, rolled down the hill and turned into a big white boulder.
Social media is like a snowball that, if controlled and combined with traditional public relations strategies, can become a huge boulder of publicity. It can also become an avalanche threat if not used effectively.
Social media has become a dominant information source, quickly providing the latest news. Individuals no longer have to wait for tomorrow's paper, headline updates on cable TV or even go online to a news site-their networks will tell them on Facebook or Twitter.
Smart advisors define their goals so that they don't waste time when using social media. They decide who to "follow," "friend" and "link in" to, and the news sources they and their clients will want to read. This allows advisors to stay on top of the industry and share information with their clients without having to produce it themselves.
Before there was Facebook, smart advisors followed publications that they wanted to appear in, identifying journalists with whom they wanted to build relationships that might lead to quotes in future stories. Now journalists post updates and tweets asking for sources.
A journalist doesn't often publicize an upcoming story, instead looking online for a source with appropriate credentials. Jessica Maldonado, vice president of Searcy Financial Services in Overland Park, Kan., says using social media makes you more visible in a Google search. "Most reporters will look you up online before they ever contact you," she says. Other times, advisors can read between the lines and pitch stories reporters might like to cover.
Jordan Smyth, managing director at Edgemoor Investment Advisors in Bethesda, Md., shares this success story: He followed Lauren LaCapra, a reporter at TheStreet.com, on Twitter. Early one morning in the fall of 2009, he first learned of Berkshire Hathaway's acquisition of Burlington Northern Santa Fe through one of LaCapra's tweets, which appeared before he saw the news on Bloomberg or The Wall Street Journal sites. Since Berkshire is one of his largest holdings, Smyth called LaCapra that morning and offered to talk with her about the deal.
LaCapra had not planned to cover the topic in detail. However, as a result of the chat, her primary article that day was about the Berkshire deal and the planned stock split, and she featured several quotes from Smyth. She informed him via Twitter that she had submitted the article. He included a link to the article on his firm's blog in a post last year discussing the stock split and has also directed prospects and referral sources to the story.
Smyth admits he's still trying to figure out how to use social media most effectively. But he is happy that it was part of his morning routine because the story paid big dividends for him.
SPREADING THE WORD
If advisors get positive publicity and nobody sees it, they might wonder whether it was worth their time. Social media can make sure the news spreads.
Two decades ago, when an advisor was quoted in a publication, his or her firm could mail it out and even have reprints made to distribute. Now, with many news organizations posting their content online, you have other options.
"Before I go on local TV, I tweet it out in conjunction with other traditional marketing, like email," says Vince Esposito, an independent financial professional with Peter J. Nagle Financial Management, in Milford, Conn. Esposito recently left a large broker-dealer partly because he believed the firm was using social media too conservatively.
As Esposito points out, prospective clients like to see that you have been quoted and can find the story quickly on a search engine. On your website, you can link to publicity. In addition to your website, other sites will appear in an online search if they contain your name, providing instant credibility. But the website is always most important.
"It is critical to have a relevant, well-thought-out and up-to-date website; this is a fundamental must for any advisor. It's your online brochure, your online store-front, your first impression," Maldonado says. "Social sites like Twitter, Facebook and LinkedIn only complement your website to create a well-rounded online presence. You can leverage positive media coverage by disseminating it to your social networks, making it easy for people to forward or re-tweet."
SPENDING THE TIME
More advisors now believe social media is a valuable marketing tool. They caution that although social networks might be free, they require time and energy, just like traditional public relations strategies.
"Social media drives publicity," says Curtis Smith, a planner at USAA Wealth Management in Houston. "I now get much more attention because of social media. I have been in a bunch of publications because someone found a blog post or something I published on social media. All this drives traffic to your website," says Smith, who founded Interactive Capital Management in 1991 and moved to USAA in February.
A great aspect of online marketing is that it is one of the easiest tactics to track. Smith was able to pull up Google Analytics reports quickly on the phone to see what articles were being read on his website and where the visitors were coming from. "It's a wealth of information," Smith says. "I can see that Facebook, Twitter and sites like FIGuide and NAPFA drive a lot of traffic."
"It's a lot of work in the beginning to build up a name," adds Smith, who has found a payoff in new business through his website. Younger clients expect to use social media, which means forward-looking advisors need to get up to speed.
"I am now working with second generations of clients," Smith says. "They communicate more through social media than traditional ways. If you want them as clients, you have to be there."
John Ritter, co-owner and managing partner of Ritter Daniher Financial Advisory in Cincinnati, agrees that social media is a powerful addition to his other public relations efforts. His firm disseminates his material through multiple outlets. "Some people get a double dose, but because they are busy, it may be the first time they see it."
In one example, Ritter was mentioned in The Wall Street Journal but it wasn't until later that he garnered new business from leads that arose through LinkedIn and Facebook. However, Ritter cautions that advisors should exercise a little discretion: "Shameless promotion is okay, but shameful promotion is over the line."
Besides discretion, you need determination. "This has to be a consorted effort," Ritter says. "Getting in the press doesn't happen without trying. Advisors can't just do postings when they have some free time. We do it enough to catch someone's attention."
Ritter says his marketing plan looks "radically different than it did two years ago." Many advisors he knows haven't created a marketing plan in more than five years. He believes they have to document and use the plan to be effective.
THE NEW PR
Advisors who are working extensively with social media believe it will not make traditional public relations strategies obsolete. As Maldonado puts it: "I fail to see how you can truly separate public relations from social media; they complement each other. You use one to parlay into the other, and vice versa."
Getting positive publicity is no longer solely the job of a PR representative you hire or traditional PR efforts you do yourself. Mixing in social media efforts creates something much bigger-and more successful.
Mike Byrnes founded Byrnes Consulting to help advisors become more successful. He specializes in business planning, marketing strategy, business development, client service and management effectiveness. Read more at www.byrnesconsulting.com.