Why Financial Advisors Need Social Media
Apr 26th, 2010 by David Svet
The implosion of Wall Street has seen a dramatic and steady exodus of investors and their funds over the last two years. While Wall Street pays the price for pushing the envelope too far, independent financial advisors all across the country are beginning to experience a very different result. This is proving to be the best of times for them. Last year more than $50 billion moved from big banks and wire houses to independent advisors according to the research firm Cerulli Associates. However, Cerulli also pointed out that Wall Street lost $189 billion in assets during the process — a marked difference.
Some advisory services are seeing growth rates between 25% and 50%. This is remarkably good fortune. It’s tempting to sit back and take orders as they line up at the door, but that would be a mistake. You would be better off attracting more clients like your best clients from the pool of available prospects. Attraction requires a proactive marketing process.
If you have an integrated system for demand generation, lead scoring, closing, onboarding and servicing new accounts, you are in great shape. Now you simply need to integrate social media into your system. If you don’t have an integrated system to find, qualify, welcome and service clients then you need to develop one that integrates social media. Why the emphasis on social media?
As always, people move their investments based on word-of-mouth advice from friends, relatives and acquaintances. Social media marketing is word-of-mouth marketing. What’s more, FINRA has finally released guidance that outlines how independent financial advisors can participate and maintain compliance. So if you intend to be proactive in acquiring the best accounts in the coming flood of opportunity, it is in your best interest to master the tools being used by your prospects to learn about you.
A comprehensive approach for marketing that concentrates on lead generation can easily be integrated with your contact management system so that you can score leads. By effectively using social media, email and interactive marketing you have a multi-channel platform for demonstrating thought leadership and your differential advantage over competitors. It also enables you to have a closed loop system for managing your sales funnel. By fine-tuning your system, or developing one in the event that you are without, you are creating a process that will enable you to filter your prospect pool to find clients that are truly a good match for your services. This will help ensure that both parties get what they need and have a beneficial relationship.
Or, you can sit back and take whatever walks in your door. It’s cheap, it’s easy and it puts the destiny of your practice in everyone’s hands but your own.
Image file is from the Open Clip Art Library, which released it explicitly into the public domain, using the Creative Commons Public Domain Dedication.
Great Article David,
Integrating social media into marketing is vital for financial advisers as advertising shifts more online and mobile.
Its interesting to see social media being integrated into the structures of financial groups. Smaller firms can adapt but I have some friends at the larger firms who have problems with the centralized compliance.
Similar to your article on personal branding, these companies build up their brand and want to manage the hell out of it, which, if you have lasting customers comes with those financial advisors who interact with them day to day. But if you have allot of employee churn or are selling products, not services, managing that brand is important.
Best,
J