If you’re still on the fence about the use of social media to serve current clients, grow your client base and build your brand, a new study by Putnam Investments should make you jump in feet-first, especially if you’re a registered rep of a wirehouse or independent broker-dealer.
The Putnam Investments Survey of Financial Advisors’ Use of Social Media found that 75% of advisors surveyed, the majority of whom were registered reps, are using at least one social media network for business purposes. Of those, 49% said they get new clients through those networks and of those, 29% said they had gained more than $1 million in new assets.
The study was conducted in July 2013 of 408 U.S.-based financial advisors, including 221 who were reps of independent broker-dealers and 120 of whom were either reps of “national” or regional BDs. The study found that the average “social advisor,” defined in this case as an advisor who uses at least one social media network daily:
- is a 44-year-old male, fee-based IBD rep
- has 10+ years of experience in the business
- manages a book of business that averages less than $150 million, with an average client portfolio of less than $1 million in assets
- uses social media to improve his referral network, build his brand and enhance relationships
- has a higher success rate than his non-social media active peer in gaining new clients on social media, with new clients’ assets averaging less than $500,000.
In a statement, Mark McKenna, head of global marketing for Putnam Investments, said the study’s findings “underscore the growing significance of social media use in the day-to-day work of financial advisors, including how they serve clients and prospect for business. This is a trend that is only likely to continue in the years ahead.”
Moreover, McKenna said the findings showed that advisors were not merely aware of the possibilities offered by social media, but were “actually leveraging the new medium to manage existing business and make huge strides toward expanding their practices.”
Of those advisors surveyed who said they used social media, 81% use LinkedIn as their primary network, and of those advisors, 66% use LinkedIn to find new clients. By contrast, 69% of advisors surveyed said they used Facebook to enhance existing client relationships.
In a footnote to its release on the study, Putnam suggested that not only younger-than-average advisors are active users of social media, noting that Putnam President and CEO Bob Reynolds has been tweeting since July 2009. Reynolds has tweeted 510 times and has 4,285 followers as of Oct. 2.
Check out 3 Tips to Stay Compliant on Social Media on ThinkAdvisor.