Advisors Are Less Euphoric About Social Media, But That Might Be Because They're Still Not Doing It Right

Tuesday, December 20, 2011 14:56
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Advisors Are Less Euphoric About Social Media, But That Might Be Because They're Still Not Doing It Right

Tags: Social Media

A recent study of advisors shows that fewer are showing results from their social media efforts than they expected -- but the problem might have been unrealistic expectations in the first place.

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The Aite Group polled 437 advisors and concluded that "the bloom is off the rose."

 

Where one in five thought their social media presence was a differentiating factor back in 2009, only 9% think that way now.

 

That's not surprising. Many of the big fish in the industry are on Facebook and Twitter now, so it's not really a unique thing to be the twittering advisor.

 

But as advisors finally get their social efforts going, they're suddenly negative on the concrete impact of all those updates.

 

Across several categories -- reaching new prospects, earning revenue, becoming more productive -- only half as many advisors say their social media presence is working out.

 

One category that did improve, and it's a revealing one. Back in 2009, only 1% said their social presence was helping them communicate with clients.

 

In other words, only 1% had a social media presence. This was before the regulators established rules for these communication platforms, so it makes sense that adoption back then was minimal at best.

 

But if so, then a lot of those bullish 2009 statements probably reflect more hope than actual results.

 

Comments (6)

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bramsay
Scott, can you point to SEC's established rules for social media?

Our assessment has been that one of the primary benefits of social media marketing is to get positive affirmations (ex. likes on Facebook), which we think are testimonials.
bramsay , December 21, 2011
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bramsay
Just found this, but it fits with our assessment

http://petermontoyainc.wordpress.com/2011/06/08/are-you-unintentionally-breaking-sec-rules-through-social-networking/

bramsay , December 21, 2011
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ScottMartin
Thanks for reading. Good catch -- I was obviously thinking more of the FINRA-regulated firms that had a social revolution this year.

SEC seems more inclined to classify "social" presence as just another flavor of Web communications, so has yet to see the need to provide specific guidance. But as you point out, the testimonial aspect of a "like" or a "+1" is dangerous -- some kind of safe harbor would be extremely helpful there.

I think a lot of people are still trying to use social as a new platform for broadcasting existing content, so they're not even thinking in these broader terms yet. Good for me to keep in mind the next time I talk to the tech gurus.
ScottMartin , December 21, 2011
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agluck
Social media hype abounds.

"Canned" offerings in which advisors put their name on articles written by ghost writers and then pass them off as blog posts are probably going to land RIAs in hot water.

The SEC frowns upon advisors making it look like they wrote articles they, in fact, did not write. The head of the SEC's investment management division once told me that about 13 years ago and Advisor Products since then has been placing disclosures to that effect on all of our content.

But don't hold your breath for the SEC to issue any guidance on social media use by RIAs. I've asked an SEC spokesman for such guidance but get nowhere.

SEC position is that existing books and records rules and advertising rules cover social media use for IA reps.

We won't know for sure that "likes" are the same as testimonials unless the SEC takes disciplinary action against an RIA an makes that action public. But many RIAs are already using "likes" on their websites and have not been slapped. Not yet, at least.

The best social media content for advisors is content created by advisors. Canned content can augment but not substitute for any advisor creating his own content with his own ideas and opinions.
agluck , December 21, 2011
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ScottMartin
Hey Andy, that's a great one to move out of the comments and into a story of its own. Especially since as far as I know big guys like Morgan Stanley are still on the "canned Tweet" model.
ScottMartin , December 21, 2011
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Joshco0752
Social media and especially blogging take time. If you're not willing to stay at it for at least a year, your not likely to see success. Like anything else that can bring success social media is not a magic bullet. It's just one of the tools that you can use to raise your profile and help people of like minds find you.
Joshco0752 , December 23, 2011

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