By Cyril Tuohy
Prospecting is the lifeblood of financial advisors and there’s no more talked-about Internet tool for turning leads into hot prospects right now than social media.
Plenty of financial advisors or their firms are already on one network or another, sometimes even two or more, but it turns out that not all social media networks are equal. Audiences are fractured and the “top five” social media sites — Facebook, LinkedIn, Twitter, YouTube and Google+ — have their respective strengths when it comes to communicating with audiences about financial needs.
Facebook and Google+ are more about building community while LinkedIn has emerged as a recruiting tool for hiring managers and businesses. Twitter seeks to engage an audience and YouTube's ability to broadcast is beyond question.
Whatever network financial advisors and underwriters prefer, the fact remains that you’d be hard-pressed to find anyone in the insurance industry – underwriter or advisor – actually selling a policy or retirement plan using social media, said Norah Denley, senior research analyst of distribution and technology research with LIMRA.
The goal isn’t to be on every social media site – a proliferating group that includes media curating and sharing networks such as Pinterest, Instagram and Vine – but for financial services companies or their distributors to engage and connect with an audience, a brand or a company.
“It’s about moving to a hot prospect,” said Denley, author of the report “Retweets, Likes and Shares: How Financial Services Companies Are Using Social Networks.”
The survey, based on responses from 53 financial services companies in the U.S. and Canada, found that 9 out of 10 companies used social media, and most of the respondents also agreed that posting content to a social media-hosted site is “vital” as a way to provide value to their audience, Denley said.
“Posting content that provides value to an audience is as important – if not more so – as reaching the audience in the first place,” Denley said in an interview with InsuranceNewsNet. Better to have small, engaged audiences than large detached ones.
A total of 65 percent of survey respondents said they are using Facebook to build a community, and a number of companies are even using the network as a customer service channel. Nearly 70 percent of companies said they use LinkedIn to recruit staff. Twitter serves as a brand awareness vehicle for 60 percent of respondents and YouTube for 83 percent of respondents.
A separate survey of 200 advisers conducted by SEI found that less than one third of advisors use social media to promote their practices online, and another 29 percent said they had no social media presence at all.
Advisors who are on social media are doing so mainly using LinkedIn, the survey also found. "Whether it's a lack of time, resources, or expertise, it's clear most advisors haven't fully committed to social media yet," John Anderson, head of practice management for the SEI Advisor Network, said in a news release.
Buyers like communicating through multiple channels, and the more advisors communicate with them through whatever channel, the more buyers are likely to warm to and trust the financial advisor, Denley also said.
Financial services professionals, she said, appear to be using Twitter to communicate with their peers or colleagues, either to engage in a conversation or to send article references or short bursts of information they find of interest.
“Companies, financial professionals can use Twitter to communicate their position as a thought leader by sharing content that others in the industry would find useful — when agents may be considering a move to another company, or doing business with more carriers/manufacturers, these thought leaders will be top of mind,” Denley said.