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Creating a Social Media Strategy for Financial Advisors

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In a recent seminar, “Growing AUM Through Digital Marketing,” VP of Corporate Development at FMG Suite Rick Fox sat down with industry insiders to discuss the state of online marketing in the financial services industry. Discussions from the seminar included technology, inbound marketing, automation, compliance, and today’s topic, social media. 

The feedback and insights from participants revealed an overall positive mindset toward creating increased AUM through digital marketing. Not surprisingly, the discussions during the seminar also focused on the real, and perceived, obstacles financial advisors and firms face, from finding the right marketing tools to learning the distinctly modern elements of online marketing. Creating a social media strategy for financial advisors is the fifth, and final, installment of our seminar summary. 

Social Media is Here to Stay 

Professionals in the financial services industry rely on statistics because their world is based on cause and effect, numbers, and facts. The potential ROI of social media marketing for financial advisors includes some pretty convincing statistics of its own. According to Think Advisor, social media marketing is being used by most financial advisors, and a majority say it has led to improved relationships with clients. Eighty-six percent of those who use social media reported gaining an average of $5 million in business.       

There’s every indication that social media, and the marketing opportunities for the financial services industry, will continue to grow. Facebook, Twitter, LinkedIn, and many other popular social mediums have become the modern equivalent of the coveted “word of mouth” that traditional marketing has relied on for generations. 

The power of social networking is such that the number of worldwide users is expected to reach some 3.02 billion monthly active social media users by 2021, around a third of Earth’s entire population.”

(Statista, 2018) 

A Social Media Strategy for Financial Advisors Should Focus on Their Audience 

Prospects are looking for answers to their financial questions online, and financial advisors can use social media to answer those questions. These prospects are also looking for a connection.

Leah Alter, Director of Marketing and Consulting at Kestra Financial, explains that, “If you can tell a consistent story across your digital footprint, through your website or social media, it helps prospects identify themselves as a good fit for you, versus the advisor having to say ‘I’m a good fit. I’m a good advisor.’ It gives them the opportunity to self-select, which is the ideal situation.”

Providing value for the financial services audience is the key. Social media isn’t about asking for a prospect’s business—it’s about giving them relevant information through content and interaction. In any business, but especially in financial services, it’s critical to build confidence and establish authority before thinking about securing business. It’s also about being genuine and personable by discussing financial issues in an authentic way to create real connections. 

Brian Cody, VP of Digital Media at Waddell & Reed, makes a good point about authenticity, saying that, “I think a good formula that we bring forward is something that is authentic to you, something that you can really, honestly, articulate authentically, something that is meaningful to the people that you are trying to speak to, something that is interesting that adds value to them, and finally something that is succinct that can really deliver the point home quickly, efficiently and effectively.”

Giving away insight and advice may not seem like the best social media strategy for financial advisors, but it is precisely what consumers want. Prospects want information that is actionable, easy to understand, and timely. As Thomas Fross, President of Fross & Fross, puts it, “When someone sees your content, do they say, ‘Wow, I just heard about that! I have to read it’? Or is it too stale, too blasé, or too boring? So, you have got to keep providing content, and you have got to keep current.”

These prospects understand that financial advisors are necessary for a complex industry, but they won’t be ready to engage and consider doing business until trust and credibility have been established. Skip the traditionally aggressive marketing techniques and opt for an online presence that provides valuable, relatable content instead. 

Reaching the Right Audience

The most valuable content, strategies, and other marketing elements can’t be effective if they aren’t positioned in front of the right audience. Financial advisors must be able to target their most viable niche market. Advisors can discover this niche by taking an objective look at what type of clients they can service most effectively. These types of clients can be further defined by demographics like income level, age, occupation, financial goals, and more. The more well-defined the prospect, the better chance of providing the most relevant content for establishing a financial advisor’s authority and credibility. 

Robert Fross, CEO and Cofounder at Fross & Fross, looks at it this way: “It’s about constantly being a thought leader, and maybe it’s not one particular thing, but because they’ve seen us that there is a better chance that when they actually need help and they have a life-changing event that we are the ones that they might call.” 

Many social media platforms can readily supply demographic information to help advisors reach their targeted audience. This consumer-specific information often contains other defining elements, such as gender and even location. A compilation of information like income level and specific interests, combined with location, can be especially fruitful for financial advisors at a local level. Armed with the knowledge gained in evaluating their services, combined with the fine-tuning of demographics, an advisor can begin creating content designed for a very specific audience. 

Social Media Strategy for Financial Advisors and Home Office Hurdles 

In many cases, local financial service offices are affiliates of larger national companies. These companies have their own marketing preferences and policies that can often hamper the local office’s ability to use digital marketing effectively in their market. Many of these marketing policies are driven by compliance concerns, while others are only guidelines. If every piece of marketing has to pass through a corporate marketing department, meet industry regulations, and be compatible with company preferences, then many local firms and advisors may think the effort isn’t worth it.

All digital marketing should be reviewed for industry compliance, and it’s simply good career advice for advisors to follow their local or national home office lead. But social media marketing can meet the most rigorous corporate and industry restrictions and still be effective. Financial advisors can’t use social media to ask for testimonials, leverage case studies, and other compliance-restricted content. But they can still engage targeted audiences with timely financial news, build authority through useful articles and posts, and build those all-important relationships. 

Brian Cody offers some good advice for working with these restrictions. “Don’t just put out anything and everything—put out everything that relates back to that core value proposition and then spend some time directing customers to content that only you can create so you are not just posting pre-approved stuff, and make sure you are posting custom stuff that resonates with your audience.” 

Remember the “Social” Element of Social Media Marketing 

Social media marketing is effective because it is a social activity. People like doing business with people they socialize with, even if it’s only in a digital world. Prospects must have trust in a potential financial advisor’s expertise, but they also want to know that advisor’s story and personality.

As Andy Barksdale, Senior Vice President of Marketing at LPL Financial, puts it, “Don’t be afraid to show your personality and mix it in with the business insight.” That’s good advice for doing business in general, but especially relevant for something as personal as the client/financial advisor relationship. 

Being “social” online can also mean becoming a part of the bigger story. For financial advisors to be relevant to the right audience, they must go beyond the typical press release or industry article. Financial service providers can really stand out and connect by using humor, sharing interesting or unusual information from the fringes of the financial industry, and, most importantly, expressing their unique brand and personality.

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