Compliance department rules aside, how do financial advisors approach social media?
Do advisors weigh in on topics with their strongly-held view of where they stand? Or do they steer clear of potential controversy at the risk of being ignored?
Advisor Ted Jenkin, author of the blog yoursmartmoneymoves.com, said that to reach a broad audience, advisors need to blog about topics around which there is controversy, and then pick a side.
New England Patriots quarterback Tom Brady is either a cheater or he isn’t.
Darren Wilson, a white police officer, in Ferguson, Mo., was either justified in shooting Michael Brown, an unarmed black teenager, or he wasn’t.
The Affordable Care Act is a progressive law that will help the long-term interests of the nation or it’s an expensive experiment paid for by taxpayers.
Is the 4 percent rule in retirement still a valid yardstick for annual retirement portfolio withdrawals or is it obsolete?
“The problem in our business is that in the insurance and financial services space, financial advisors stay away from controversy,” Jenkin told InsuranceNewsNet.
“To be good at social media you have to be controversial. You have to pick a side. (Tom) Brady is either a cheater or not, but many times financial advisors don’t want to pick a side.”
Bloggers or social media posters who pick a side will slowly find their voice and that will attract eyeballs, said Jenkin, whose blog attracts about 20,000 subscribers.
Recent posts on yoursmartmoneymoves.com include “Smart Financial Gifts for the College Graduate,” “Why 9 to 5 will Never Exist Again,” and “A Donation Line on Your Dining Out Bill.”
Blog entries, short articles designed to elicit — or log — the point of view of the writer, allow for more space than the 140 characters limited by the social media platform Twitter, or than the text boxes found on other popular social media outlets.
That makes blogs a different channel for expression than Facebook, LinkedIn and Instagram, which are designed to post two or three sentences, images and links to other people active on social networks.
Twitter in particular, is conducive to what advisor and blogger Michael Kitces calls “spontaneous engagement.”
But in a few cases, celebrities and even politicians have had to backtrack, issue apologies or remove tweets and accounts in the wake of firestorms of criticisms.
Financial advisor surveys indicate that while as many as three-quarters of advisors have and own social media accounts, only a handful of those advisors close deals or execute any kind of transaction using the social media channels by themselves.
Blogs and social media are a way for advisors to build an audience, find referrals and stay in front of family, friends, colleagues and business contacts, according to advisors active on social networks.
Dallas-based financial advisor Danny O’Connell, a partner with the financial planning firm BRG, said that the golden rule of social media is to steer clear of controversy, argument and incendiary postings of any sort.
“Remember the world is watching you and you don’t know the circumstances of people’s lives,” he wrote in a recent article. “Try to be inspiring, uplifting and happy instead. Like your mom said, ‘If you don’t have anything nice to say … .’”
Odds are that few financial advisors would post incendiary remarks on matters of the day in public, and almost no one would issue scathing remarks about clients, even if their advisory practices’ compliance departments allowed it.
O’Connell suggested that advisors who choose to engage in an active social media strategy keep their messages short and specific.
“You have to be very specific and show them the value you are going to bring to them,” O’Connell said.
Kitces, who has used blogging and social media in the past three years to help grow his business, wrote that among the most important lessons he’s learned is that social media is a means to sharing thoughts with other people.
“Social media is not an end point unto itself, and you’re not going to get very much business directly from just social media itself,” Kitces wrote in a post last year on his widely read Nerd’s Eye View.
The idea of maintaining a blog and posting on social media platforms offers bloggers and social media users an opportunity to showcase their expertise. Advisors with expertise in one subject or another are then referred to other people active on a social network.
While his blog postings demonstrated his expertise in the field, it was via social media channels that people found it, Kitces also wrote.
Advisors should think about and understand the audience they want to reach. Offering content that solves the difficulties faced by clients and other people is the best way to let others find you, he wrote.
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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