Nearly 43% of advisors have attributed a return on investment to social media use – bringing in anywhere from less than $1 million to more than $5 million of new business, according to a survey from American Century Investments.
American Century Investments’ sixth annual Financial Professionals Social Media Adoption Study examined advisor usage and attitudes toward social media platforms of more than 300 financial advisors, brokers or registered investment advisors.
“Determining return on investment of social media and other marketing approaches can be a challenge, so this year, we wanted to ask advisors whether they were seeing a difference in how social media furthers their client relationships,” Brent Bowen, corporate communications director for American Century, said in a statement.
The survey digs deeper to find out exactly how much impact — in monetary terms — social media has had on advisors’ businesses.
The survey particpants were asked, “Have you ever acquired a new client or gained a relatively large additional amount of business from an existing client in part attributed to your social media efforts? If so, how large was the win?”
While 57% of the respondents reported social media not having a significant role in acquiring a new client or business, there was a significant portion of advisors that did see an impact.
According to the survey, more than one out of four (27%) advisors reported they had acquired a new client or gained a relatively large amount of business from an existing client in part because of social media (less than $1 million).
Another 10% of survey respondents reported had acquired business of $1 million to less than $3 million of business, 4% reported new business of $3 million to $5 million, and 3% reported new businses of more than $5 million.
The survey finds that more and more advisors are using social media. According to this year’s survey, 95% of financial professionals surveyed have experience (ranging from minimal to extensive) with social media – which is more than the 92% last year.
The survey also finds that more and more advisors are seeing how social media can have a significant impact on their businesses.
According to the 2015 survey, 26% of advisors said that social media is already producing tangible results for their business. That’s more than any other year, and a significant increase from the 17% who said the same thing in 2014.
Interestingly, the survey finds that more firms than ever before have a formal social media policy or set of guidelines. According to the survey, 74% of those surveyed in 2015 work for a firm with a formal social media policy. That is up from 65% in last year’s survey and 53% in the 2011 study.
The survey looked into specific restrictions that advisors’ firms have in place for social media, and it found that 24% either know or believe there are no company restrictions.
The top company restrictions include prohibiting posting content that has not been preapproved (51%) and prohibiting content posts of products or services (24%). Other restrictions include blocking access to all social media sites (16%) and prohibiting using social media for business (16%).
The survey, conducted in March, included responses from 300 financial professionals – of which the majority were financial planners, financial advisors or personal financial consultants (81%) but also included brokers (21%) and RIAs (17%).
Of the study participants, about 71% were male and the average age was 50 with an average 17 years in the financial industry.
—Related on ThinkAdvisor: