More than ever, advisers make a splash with social media

Use of LinkedIn, Facebook and Twitter all up significantly, surveys show

May 28, 2015 @ 2:17 pm

By Alessandra Malito

+ Zoom

Advisers are spreading their wings and tweeting, liking and sharing a lot more these days.

Two separate surveys, one by Smarsh Inc., a compliance company, and another by Cogent Reports' Advisor Media Consumption, which collects data on financial advisers, both found that advisers are breaking down the barriers and using social media for their businesses.

The numbers are up — way up — across the board.

Overall, there are more than 228,000 advisers — about 75% of the total number of advisers — actively using social media for professional reasons, according to Cogent Reports' survey.

And Smarsh found that social media sites have seen significant jumps in adviser usage: 39% of advisers used Linkedin in 2011 versus 72% today; Twitter usage has gone from 14% in 2011 to 44% today; and Facebook is not far behind at 34% today, up from 23% in 2011.

It's not just pre-approved content, either. Amy McIlwain, author of “The Social Advisor: Social Media Secrets of the Financial Industry” and vice president of social and digital strategy at Moore Communications Group, said she's seen advisers move away from pre-approved comments and move toward a more conversational tone on social media.

"Social media isn't a tool where you're pitching and selling products," Ms. McIlwain said. "It's where you're building relationships … positioning yourself as an expert."

"Advisers need to find their own voices to connect with clients and prospects," she added.

There is a lot of oversight when it comes to advisers using social media accounts. The Financial Industry Regulatory Authority has regulations on blogs and social media sites for firms and registered representatives, and some firms have their own compliance offices as well.

Douglas Boneparth, a financial adviser with Life and Wealth Planning in New York, said as long as advisers don't break the "golden rule," using social media can and should be used by everyone.

"Don't give investment advice," Mr. Boneparth said. "And that's easy for financial planners to do because we're so planning-focused."

He said he's seen compliance offices ease up on the use of social media sites, as well.

And it's all because of demand.

"Social media was not then what it is today," Mr. Boneparth said. "Demand is up. People are using it to drive business."

"Any time that happens, it will start to shape regulation and move regulation in a much more expeditious way," he added.

The Cogent Report survey showed similar results. While it is no surprise, LinkedIn is currently the No. 1 platform used by advisers (of the 74% of advisers who said they use LinkedIn in the Cogent survey, 59% said it's their primary platform). But other sites are getting traction as well. Of those surveyed by Cogent, 75% say they use YouTube, 65% say they use Facebook and 32% say they use Twitter in some professional capacity.

Eric Roberge, a financial adviser with Beyond Your Hammock in Salem, Mass., said he takes advantage of YouTube because of its wide audience.

"YouTube gives me that new paradigm to share my personality and to hopefully provide more information to more people and keep them entertained at the same time," Mr. Roberge said. "I'm going to click on a video. That's more enticing to me. I want to be that for other people."

Mr. Roberge, who is registered through Massachusetts and therefore does not need to comply by Finra's regulations, said he knows what he should and should not do or say on social media sites. For him, those sites are meaningful ways to provide education to clients and prospective clients and to have a voice.

"It's like a ramp I can use to consistently stay in front of people," Mr. Roberge said.

Cogent extrapolated its figure of 228,000 advisers from Discovery Data's estimate that there are 300,000 working advisers. It conducted its survey of 1,390 in the first quarter.

Smarsh surveyed 274 advisers in February and March.

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