By now, most of us would agree the Internet is not some fly-by-night drug-crazed hippie fad. Some of us jumped on board early (AOL), others jumped on later. Either way, we'd all have to agree that the impact the Internet has had on most people's daily lives is undeniable. Imagine if we knew then what we know now about the Internet... we'd all be filthy rich. Granted, it would be in the porn industry but hey, rich is rich.
So what's the next big thing out there that most of us will have very little understanding of until it's too late to capitalize on it? Social media is the next big thing. How do I know? Well, way back when the Internet first plugged in I was mesmerized. To learn more, I signed up and attended a three-hour workshop all about the brave new world of the Internet. As I walked out of the seminar I remember thinking, "What in the hell was that guy talking about?"
Last week, I attended yet another three-hour workshop on (you guessed it) the brave new world of social media. I am now convinced it is the next big thing because when I walked out of that seminar I thought, "What in the hell was that guy talking about?"
Going over my extensive notes I've learned that we are now in a new era called the Social Economy. Just so you can keep score at home, we have already completed the era of Social Relationships and are just finishing up the era of Social Functionality. We are now in the beginning of the era of Social Colonization (which to me, sounds like a kegger on Mars). This will be followed by the era of Social Context and then finally in 2011, the era of Social Commerce. This is when we'll all get filthy rich.
Our job until then is to learn all we can about Facebook, MySpace, LinkedIn, Twitter, etc... Sounds like a root canal job to me. I will admit that I was reluctantly pulled into Facebook. An old high school classmate had pictures of our class reunion posted on Facebook. The only way to see them was to sign up for an account. The fact that I was able to spy on my high school son at the same time was merely gravy.
I also admit to experimenting with Twitter too, but ultimately couldn't fiFacegure out why. So there it is -- my extensive foray into the new Social Economy. No matter how hard I try, I still can't hear the "cha-ching."
Before I give up on our new era, I did learn some exciting facts. The most compelling (and the only one I can remember) is that of all the purchases made today, 80 percent start out looking on the Internet. So the question is what can you do to get these people's attention?
Because social media is a form of client communication, you are going to have to send your friends in the compliance department an invitation to the party. Try not to be too hard on them; they're in over their heads on this one. There is little cutting-edge guidance from the regulatory agencies on this, and my guess is your broker-dealer's compliance department is not going to want to be blazing any new trails in this area.
So what can you be doing now? If you google the term "financial advisors and social media" you will find articles about advisors who are currently using social media. Granted, their compliance people may be bigger drinkers than yours, but at least you have a toe in the water or a model you can consider.
All things change and eventually, compliance will catch up. Be ready when it does. Change begins slowly but when it finally arrives, it hits hard and fast. Have you hugged your compliance officer today?