Social Media Provides Return For Financial Pros

New Survey Explores Usage and Attitudes about Social Media

Social Media Provides Return For Financial Pros
February 26, 2016

Financial professionals have a greater understanding of the value of social media and are seeing dividends from increased use of social media. That is the essence of the findings from the annual Financial Professionals Social Media Adoption Study from American Century Investments.

The vast majority of financial professionals have at least some experience with social media — 60% of respondents had moderate or extensive social media experience while only 5% had no experience at all. Facebook and LinkedIn are clearly the most used platforms with 75% of respondents having Facebook accounts and 70% having LinkedIn accounts. Twitter is far behind at 37%, and YouTube, Google, and Instagram all in the 23% to 27% range.

LinkedIn is a clear favorite among financial professionals, and has shown the greatest return on efforts. 48% of respondents reported that LinkedIn had enhanced their profile with clients, 28% reported enhanced business knowledge and a same percentage reported improved referrals. However, most financial professionals are sticking with the basic LinkedIn services. 77% use none of the LinkedIn Premium Services. Of those services, Business Plus was the most popular, claiming 9% of respondents.

In the three categories of monitoring market and industry news, finding expert commentary, and brand promotion, LinkedIn was by far the preferred social media choice with 29% to 31% positive responses in all three categories. No other social media outlet had above 15%.

52% of respondents believe that business connections on social media make it more likely that the connection will do business with them and 43% of respondents give social media credit for at least some return on investment. 27% have seen returns of $1 million or less, 10% saw returns between $1 million and $3 million, 4% saw returns between $3 million and $5 million, and 3% enjoyed returns above $5 million.

The two major uses of social media for businesses covered both sides of the information exchange. 28% of financial planners used it for input by reading expert commentary and insights from other social media postings, and 17% used social media as a vehicle to share their views on financial news while providing relevant content.

Again, content is key. The main reason listed to follow an asset manager’s social media activity is to find content that is not available anywhere else. Useful new content was cited by 54% of respondents as the main motivator to follow a particular site, followed by a user-friendly site (42%) and an engaging author personality (37%).

Simply having a social media presence is not enough; you have to manage it correctly and stay within certain guidelines. Deal-breaking activities that preclude customers from doing business with a firm include a lack of professionalism (59%), privacy or data breaches (57%), excessive political crusading (39%), and the scourge of all web content — irrelevant or boring posts.

When asked about the single biggest concern with using social media for business purposes, 32% of respondents chose regulatory/compliance issues, which is not surprising given the potential gray areas of what could be considered endorsement (re-Tweeting and liking Facebook pages are useful examples). Others were concerned about potential privacy breaches (25%) and company/home office restrictions on use (23%).

Social media appears to be catching on with financial professionals, and it is likely to become eventually a standard tool that distinguishes the savvy professional with a growing practice from the old-school advisor who cannot change with the times. Those who adapt will survive and thrive. Those who do not may have difficulty holding on to their business.

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Erin | 02.26.16 @ 16:24
This doesn't surprise me. The savviest people in all industries seems to have gotten on board with what social media can do for them. Everything is becoming so interconnected you kind of have to use it or get lost.
Steffanie | 02.26.16 @ 16:24
Social media can be a good thing, but not always. Glad it is a positive for the financial world so far.
Carla | 02.26.16 @ 16:25
Social media is a great way to get your name out there. It can also be devistating if you don't run a business well.
irene | 02.26.16 @ 16:25
Wow, Social media has a larger impact than I was aware of.
Kamie | 02.26.16 @ 16:25
Social media is a great outlet to be found. heard, and to sell. The key to it all is to make sure things are provided that people enjoy, want to know, and to stay active. Along with being active if your followers also. Ignoring questions and concerns can lead to a bad review of a company/person.
Sarah | 02.26.16 @ 16:26
social media is a huge player in everything now. no surprise here.
Nancy | 02.26.16 @ 16:28
Social media can be a great marketing tool. Even the smallest of businesses use it.
Sara | 02.26.16 @ 16:28
Really does not surprise me since so many businesses use social media now.
Heather | 02.26.16 @ 16:29
Social media has proven it plays a huge part in our everyday business life. Its a great way for companies to communicate new products and a R5 vices along with customers to voice their complaints to get things resolved.
Alec | 02.26.16 @ 16:32
Social media is where everyone is these days so it makes sense that it would be a good place to advertise and post. I personally get irritated at pages that don't share enough relevant content or who push their product or service too hard with no interaction with their followers.
Ron | 02.26.16 @ 16:35
The toughest part of social media as mentioned is content that is compelling, engaging, and useful to attract and monetize through connections, referrals, etc. As a content creator myself, there is a fine line between filler and killer. Your audience may be fickle and fragmented, but if you offer something that all are wanting and/or need, then you will see those returns in promotions through social sharing and engagements over your product/service. That said, it takes practice and research.
$commenter.renderDisplayableName() | 11.27.20 @ 08:45