The use of social media by wealth management firms can offer tremendous opportunities, according to a new paper from consulting firm Accenture. Compliance challenges still exist, however, as companies move from social networking pilot projects to “socially infused” marketing and sales channels.
The paper, titled “The Social Advisor: Using Social Media Effectively in Wealth Management,” says that, despite the fact that social media are allowed as means of communicating with clients, many firms are still feeling their way toward a more robust incorporation of them into their business models, even as clients and prospective clients rely on them more and more.
The lack of specific guidance, but strict enforcement, by regulators contributes to a complex picture as firms test strategies and tools. And wealth management firms using social networking tools will find that those tools involve a number of costs. Accenture says those costs include social media management software, archiving and storage space, content partners, training curricula, regulatory upkeep, and dedicated resources to manage the communication.
“Firms need to determine,” the report says, “what costs are part of doing business and what costs are pushed into the channel.”