While more advisors are using social media, broker-dealer reps and wirehouse brokers use it more frequently and see it as a more valuable business-building tool than do registered investment advisors, according to a just-released study by American Century Investments.
Roughly half of the 301 advisors surveyed use social media for business purposes on a daily or weekly basis, compared with only 21% of RIAs, the study found.
Most RIAs do not use social media for business purposes at all, compared with 66% of other advisors who are using social media for business purposes.
Some 62% of financial advisors at wirehouses and BDs have scheduled a meeting in the past year as a result of social media versus 35% of RIAs, the study found.
Nearly one in five BD and wirehouse advisors have scheduled more than 10 meetings in the past year from social media, compared with only one in 20 RIAs.
“We found that 57% of advisors now use social media in their practice, versus only 25% in 2010,” said Diane Gallagher, vice president of client marketing for American Century Investments, in releasing the study results. “Furthermore, 63% of advisors now have a social media program at their company, up from 53% in 2011. This says to us the industry has come a long way.”
The study also found that older, more experienced advisors use social media more than their younger counterparts.
According to the study, 85% of advisors with five to 20 years of experience use social media for business purposes, while only 44% of less-tenured advisors do.
Also, four out of five advisors with five to 20 years of experience have scheduled at least one meeting in the past year via social media, while only two in five with less experience and more than 20 years of experience have done so.
Consequently, the study said, “almost four in five medium-tenured advisors have increased their assets under management in the past year by using social media, while only two of five other advisors have.”
The research also found that advisors who received advanced social media training saw a greater business value than advisors with basic training.
“Advisors with more in-depth training used social media more frequently; over half with advanced training used it daily. Also, advisors with advanced training were able to get in front of key decision-makers using social media that they otherwise could not at a much higher rate than with basic training alone,” the study found.
Some 92% of advisors with advanced training felt participating in their company’s social media program was a good use of their time versus 53% of advisors with only basic training.
“Simply put, the more firms train their teams, the more value they receive,” Gallagher said.
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