Social media continues to make inroads with advisors — but there’s still plenty of room to grow.
Asked if they had ever acquired a new client or gained a relatively large additional amount of business from an existing client in part attributed to their social media efforts, more than half (57%) of the respondents to a recent survey could cite no instance where social media played a significant role in acquiring a new client or a relatively large additional amount of business from an existing client.
That said, 27% said that they had that experience, though that new business was under $1 million, 10% in the $1-3 million range, 4% in the $3-5 million range, and 3% said it was over $5 million.
Nearly all — 95% — of the financial services professionals participating in the 2015 Financial Professionals Social Media Adoption Study by American Century indicate they have some experience — ranging from minimal to extensive — with social media. Indeed, over 60% report moderate to extensive experience.
The survey found that Facebook was the most common platform on which advisor-respondents had an account (cited by 75%, up from 68% a year ago), but LinkedIn was close behind (70%, up from the 66% reported the past two surveys). Twitter came in a distant third, cited by 37% (up from 33% the prior year.
Expanded Business
Just over half (52%) say that being connected (for business purposes) on social media with someone makes it more likely that they will do business with someone, though nearly as many (45%) said it had no effect (2% actually said it made it less likely).
Related: Many Linked In to Social Media, But Impact Remains Elusive
Over half (54%) said that social media had significant future potential for businesses like theirs, compared to 44% who expressed that sentiment in the present tense. About a quarter (26%) said that social media is already producing “tangible results” for their business — roughly equal to the 23% who said it has little value for business. The latter was up significantly from the 13% who expressed that sense a year ago.
LinkedIn Links
As for how LinkedIn as helped their business (more than three-quarters, 77%, were not using any of the platform’s premium services):
48% - Enhanced my profile with clients
28% - Enhanced business knowledge
28% - Improved my referrals (open a door that otherwise had been closed)
24% - Shared insights with clients and prospects
18% - Attracted new clients
12% - Retained clients
Of course, a quarter (26%) said they aren’t seeing any positive changes that they attributed to LinkedIn.
Business Applications
The top three business uses of social media cited were:
28% - Reading expert commentary/insights (third year in a row at that level, and leading this list)
17% - Sharing news/content relevant to my clients
12% - Researching people (e.g. prospects, contacts, current clients)
Perhaps not surprisingly, advisors’ single biggest concern about using social media for business purposes was regulatory or compliance issues, cited by 32%, though that was down from 47% in the 2010 study. However, moving up on the list of concerns was potential privacy breach (25%, up from 21% a year ago), and company or home office restrictions on use (23%, up from 19% a year ago).
The survey had 309 respondents, broken out as follows; 81% financial planners, financial advisors or personal financial consultants, 21% brokers, 17% RIAs. Participants had an average of approximately 17 years in the business. The average age of the participants this year was 50, with ages ranging from 23 to 84.
A recent survey of more than 800 financial advisors by Putnam Investments conducted in partnership with Brightwork Partners LLC, found comparable business use applications, as did a survey of NAPA Net readers earlier this year.
