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Where the affluent are online

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Recently, I attended the FPA Rise Symposium in Denver. After hearing a compelling presentation by marketing coach Tony Oechsli, who spoke about an important yet seemingly taboo topic for financial advisors—attracting affluent clients—I decided to do some research and uncovered some interesting facts about the online behavior of affluent individuals.

While affluent people were initially reluctant to utilize social media, they (like everyone else) are now hopping on the bandwagon. A 2011 Spectrem Group study found 47 percent of U.S. ultra-high-net-worth investors (those with a net worth of $5 million to $25 million, not including primary residence) now use social media. Other than increased concerns about privacy, the online habits of affluent individuals are not much different than those of other segments of the population. Here are some key elements for advisors to consider when targeting an affluent audience online:

1. They’re on LinkedIn. Many studies show that today’s affluent investors use LinkedIn the most. In fact, Spectrem discovered that 26 percent of UHNW investors use the professional-focused social networking platform. Furthermore, 40 percent of LinkedIn users who are also financial customers earned an annual income of more than $100,000. While LinkedIn may not be the platform to showcase your unvarnished colors (the way your blog or Facebook are), it is a great place to identify and connect with movers and shakers.

2. They read blogs. Blogs are another good way to reach wealthy Americans. Nearly one-third (30 percent) of UHNW individuals say they either read or would read blogs by trusted financial advisors. The percentage is 20 percent for millionaires and 21 percent for the mass affluent. Spectrem president George H. Walper, Jr., states, “Wealthy investors are interested in reading blogs by trusted financial advisors. Learning how to effectively use social media and financial blogs is critical to the future success of financial services firms. Providers who fall behind run the risk of frustrating their investors and losing customers.”

3. They research relationship managers online. Research indicates that affluent individuals research potential relationship managers before they make decisions. Stephanie Harper Stephanik, who manages social-media marketing for Northern Trust, says that “affluent clients use social media professionally to obtain brand advice from peers, discover thought leaders and search for recommendations on services and advisors.”

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4. What they look for. Financial Planning magazine identifies six key characteristics that affluent individuals search for, both online and offline, in potential financial advisors:

  1. Character—trustworthiness, honesty and integrity.
  2. Chemistry—a connection that shows you understand them deeply. They want somebody they can trust and build a lasting relationship with.
  3. Caring—a sense that you empathize with your clients and that you value them as people, not just as revenue sources.
  4. Competence—technical, investment-related skills as well as a leadership position in your area of expertise.
  5. Cost-effectiveness—proof that you provide high value for your cost.
  6. Consultative—a willingness to collaborate with clients.

When engaging in online activity, aim to convey these characteristics through all your words and posts.

Word of mouth is the number-one factor in selecting an advisor. Now, let’s be honest: A majority of client-advisor relationships are shaped by offline interactions. But social media, blogs and websites are great places to reinforce your values and character as an advisor. Because most clients and prospects will scope you out online multiple times, it’s vital to have a solid presence that echoes your offline presence.

Affluent individuals, along with a large portion of the population, are on social media. To attract these people, it’s important to have an online presence that strikes a chord with them and conveys that you are a trustworthy and genuine resource for them to confide in.

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