How can RIAs use social media effectively?

The transition from the broker-dealer world to registered investment advisor (RIA) can open up a can of new marketing opportunities. Chief among them, of course: the ability to leverage social media. However, many new RIAs struggle to maximize this powerful channel.

Matthew Gottshall, financial planner at Balanced Wealth Group, an RIA, understands this all too well. As a new RIA who went independent just under a year ago, he admits going RIA has allowed him to have more freedom to post what he wants on the platforms of his choosing.

“Education and content has been something that I've been passionate about and producing for a while. It just made it hard to do it in the old world because of the red tape. Making that transition opens up the world for us to be able to market more freely and across multiple channels that we weren't able to do before,” admits Gottshall.

Gottshall says the key for new RIAs is finding their authentic voice and using social media to build trust with prospective clients. "It's really hard to build trust with people when you have only your firm name behind you," he explains. "If you're posting from a firm-level account, it's difficult to establish that personal connection."

Gary Frayter, social media consultant at Gary Frayter LLC, highlights posts can include educational information, market insights, or even personal stories that resonate with their target audience.

“Understanding the ideal client is crucial. Advisors should consider the following questions: What are the demographics of their ideal client (age, gender, etc.)? What is their income level? What challenges or fears do they face? What motivates them to make changes in their financial lives? By answering these questions, advisors can craft content that educates, entertains, or inspires their target audience,” he said in a statement.

Gottshall also recommends RIAs focus on developing their brand by melding a professional account and a personal one.

“How do I share my story, my experience and the day-to-day stuff that I'm working on with clients in a way that resonates with people? Social channels are a way to distribute that message because people consume content in all different ways,” he notes.

Frayter added that while regular engagement is key, it should always be done with care. “Advisors should respond to comments and messages professionally, always avoiding specific financial advice in these interactions,” he says.

“Consistency is important. Maintain a regular posting schedule over six months, aiming for 1-2 pieces of content per day, and focus on improving one aspect each time,” explains Frayter.

Indeed, one of the benefits of building a library of content is being able to repurpose it in several different ways for different channels, notes Gottshall.

“If I record a podcast about employee stock purchase plans and I write a script, I could turn that script into 10 short form tweets or I can turn that into a longer blog post on LinkedIn.”

Because several advisors use LinkedIn, a good engagement rate for RIAs generally falls between 1 percent and 5 percent, explains Frayter. Here's a breakdown, according to Frayter:

1 percent to 2 percent: This is considered an average engagement rate.
2 percent to 5 percent: This is considered a good engagement rate, indicating effective audience interaction.
Above 5 percent: This is excellent and shows high effectiveness in engaging your audience.

Additionally, focus on click-through rates (CTR) for any links shared. A good CTR on LinkedIn typically ranges from 0.5 percent to 2 percent, depending on the content and audience.

Frayter notes for every 1,000 followers on LinkedIn, a good impression number is approximately 8.63 impressions per 100 followers per post, translating to about 86 impressions per post for 1,000 followers.

“However, the average impression rate can vary, with some reaching up to 20 percent of their followers, which would equate to around 200 impressions per post for 1,000 followers,” he highlighted.

The best content for advisors, Gottshall believes, is highlighting a client situation, explaining the pain points and how the conflict was resolved.

"If someone reads that, they're going to say, 'That's the exact position I'm in.' It's less about ‘Here's what I'm going to do for you', and more about just showing people what it is that financial advisors do,” he says.

At the end of the day, while there are a lot of metrics to track, like engagement and impressions, new clients and referrals are the best way to gauge what’s working, says Beth Romer, owner and founder of L&L Collective, a marketing agency in Ohio.

“If you prioritize your LinkedIn account and have a solid strategy in place, you’d be surprised by how many people mention it at your next in-person event,” she said in a statement.

“Like anything, it’s a long game. You may not see results overnight, but it’s important to stay consistent, stay true to yourself, and offer a fresh perspective.”

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