Don’t Fear Social Media, Advisors Say

The “fear” over social media use has been “ridiculously overblown,” advisor, blogger and Twitterphile Michael Kitces told advisors at Schwab’s IMPACT conference, held in mid-November in Washington.

“A lot of what we [advisors] talk about on social media is far from what the SEC is scrutinizing. I think we’ve gotten way too wrapped up in the compliance fears around social media,” Kitces told a packed room. “I don’t want to minimize [social media compliance] to nothing; [advisors] should have a social media policy in place and know what their people are doing, but we’ve made [compliance] out to be much more of a demon than it really is.”

Kitces was part of a panel that included two other advisors who are using social media as a way to educate clients and build their brands.

Jim Bell with Bell Investment Advisors, located in the San Francisco Bay area, told advisors that social media “is really about education, not selling.” Advisors using social media should be a “resource for relevant content; you want to position yourself as a thought leader.”

Catherine Maniscalco Avery, president of Catherine Avery Investment Management, agreed that social media is best used as a tool to educate clients, which for her includes baby boomers and high-net-worth women. Avery said she started using social media to not only educate clients, but to “draw people to our web site.”

Avery offered three tips to best leverage social media. She told advisors that the best way to “grow their client base” using social media is to “think about who your clients are and what social media they use.” Also, she said, use the social media platforms “that you’re comfortable with. Don’t use one that you won’t use on a consistent basis.”

Kitces agreed, stating that for him, Twitter is his social media platform of choice because the “most connections get formed” through it. Twitter, he said, is a “mass relationship” builder and a good way for a self-professed introvert like himself to get referrals.