For every advisor superstar who claims to have mastered social media, dozens more are relative newcomers to that online realm. One in every seven financial advisors began using social media only as recently as last year, a new survey has found.
But 75 percent of financial advisors said they expect to increase their use of social media this year. They said they will be more active on social media even if their usage is likely to remain modest and nowhere near enough to have any impact on key metrics of their practices, the survey found.
What advisors said they really need is advice and guidance to help them engage with social media as an average user who isn’t obsessed with connecting to the Web. That’s according to Howard Schneider, president Practical Perspectives, who conducted the survey.
“They hear stories of advisors with all sorts of success but that's not average advisor,” Schneider said in an interview with InsuranceNewsNet. Most advisors remain dabblers in social media, he noted.
‘The question is how do you provide help to advisors who will not devote the time and energy to being a leading practitioner and how do they get value out of it,” he said. “Many of them spend 10 or 15 minutes a day in social media, and only a couple of times a week.”
The survey questioned financial advisors representing full-service and independent brokers, financial planners and registered investment advisors.
Advisors complain that they often are hampered from exploring social media with any depth because of the strict compliance functions imposed by their firms. But even with those restrictions, most advisors only dabble in social media channels like Twitter and LinkedIn.
Nor are advisors turning to their insurance carriers or asset managers for help.
Advisors who do seek help rely instead on their broker/dealer or on peer networks to help them become more familiar with all that social media has to offer in hopes of generating income from the social media channel.
For the vast majority of advisors, social medial remains an underwhelming experience and the channel has fallen short of expectations.
But for advisors adept at using social media, the rewards are enormous because the cost of using the channel is so low.
Advisor Ted Jenkin, an avid user of social media, told an industry panel last year that he generates 25 leads a week from LinkedIn, Facebook, a blog and his guest column on WSJ.com, the website of The Wall Street Journal. Jenkin is co-CEO and founder of oXYgen Financial near Atlanta.
Segmentation metrics available on social media sites allow him to target very fine slices of his audience and reach people who would never have been on his radar screen 15 years ago, Jenkin said.
But how many advisors have a blog, a guest column and multiple social media pages?
Not many, and that’s exactly Schneider’s point. Most advisors aren’t going to hire an expert to run their social media platforms, nor are advisors going to invest resources in teaching themselves new tricks. This is especially so if they are approaching age 60 with a client base that may be even older.
For many advisors, social media is still very new.
The adoption challenge revolves around how to communicate the value of the social media channel to a 55-year-old advisor with 10 or 15 years left in their career. Adding to that challenge is showing that advisor how to use social media without requiring them to spend all day pumping out blogs and clicking through LinkedIn and Facebook profiles.
But many advisors eventually will master the channel, and many advisors under the age of 40 have already done so.
“There’s a clear split in the age extremes,” Schneider said. “Advisors under 40 are much more likely to integrate it and use it, but advisors above 60 aren't really using it.”
The survey results were included in the report, “How Financial Advisors Use Social Media – Trends and Opportunities 2016.” The data for the report was collected from more than 600 advisors through an online survey conducted in December.
InsuranceNewsNet Senior Writer Cyril Tuohy has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected].
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