Everyone's going social. One financial advisor told me that if you're not using social media, "you're nonexistent in the eyes of many."

That applies to clients — and prospects — at all levels of wealth. A Fidelity Investments survey found that two-thirds of millionaires would like to use electronic media with their advisors.

And nearly 70% of investors with more than $100,000 in assets have re-allocated their holdings or began relationships with investment providers based on content found through social media, according to Cogent Research.

Many advisors may know how to use social media for personal use. But when it comes to professional purposes, it's a different story.

Often you're not trained on how to use it. You might also have internal policies in your workplace that control what you can say and do.

For companies, the biggest challenge is monitoring employees. And it's indeed a major challenge. Just consider: three main platforms — Facebook, LinkedIn and Twitter — and perhaps hundreds or thousands of employees or advisors.

On top of that, industry regulations call for requirements that allow for archiving and spot-checking.

So while many industries — from food to fashion — have rapidly adopted social media, the financial industry is just now making headway.

Both the SEC and FINRA recognize its growing use, and big-name firms are using it to build their brand and business. As more investors go online — whether on their cell, iPad or social media — how should you be communicating with them?

Here are five ways to leverage social media:

• Build Your (Personal) Brand. Social is just that-social. It's about you, as a person, sharing your expertise or brand to connect with others who are equally interested. One way you can achieve this is by sharing or distributing content — articles, research, other thought leadership — into the social world. Here at Finect, we offer a compliant social media platform that enables advisors and companies to do just that. That means your message — whether it's on college savings or tax mitigation strategies — can be shared on LinkedIn, Twitter and/or Facebook in seconds. One of the ways you can build your brand is by creating a profile that clearly tells online users that you're a professional.

• Engage Prospective Clients. Perhaps the main reason financial professionals want to use social media is to find new clients. But while many might share content through the online world, the opportunity to then engage often falls short. They've read your article, now what? Can they find you? Call you? Email you? Chat?

Through your own groups that you create and control, you could do just that. Invite readers and investors to join your group around a topic or theme. You now have a place to engage with them — take weekly Q&A around, say, Social Security issues or investment strategies. Answer questions. Share your reactions to market news in seconds.

• Serve Existing Clients. Another strategy is to use social media to service clients. I know one financial advisor who focuses on busy working women and uses social media not only to reach clients but to update them. She sends out daily or weekly snippets of advice that link to an article or a video on YouTube. By forming a private or closed group for clients, similar to that discussed above, you could send instant updates to clients without having to deal with email, snail mail or others means of communication. Everything is stored in a central location, making it easy.

Closed groups have also been used internally, such as by financial planning associations and companies, to allow employees to share best practices with one another. Companies can post minutes of any internal meetings and then allow employees to ask questions; the answers can be seen by all.

• Follow Pros, Products. Keeping abreast of your favorite thought leaders or investment products isn't easy. You could follow them through Twitter — a good place to reach influencers. You can even use Twitter, as many professional portfolio managers do, to generate investment ideas.

Depending on your role, you may want to track what your employees are saying and doing on social media. While compliance tracking software does exist, some come at significant costs and require an even greater time to implement. Either way, you may want to be able to approve content in advance of publishing it; track what employees are saying; address or remove testimonials, endorsements and advertisements; conduct your own spot-checking; and access reports on all or certain employees.

A former compliance officer from a major shop recommended that compliance officers should try a platform first. A firm should want to have the functionality to capture a tweet or a post, all in one location, he says.

The bottom line: The world is going social. The financial industry and advisors do not have to get left behind. New tools exist to help them leverage what they know — and take a leap into the social world, safely and compliantly.

By the Numbers

• 500 million Facebook users
• 200 million LinkedIn members (2 million in financial services alone)
• 400 million tweets per day
• 48% of advisors report using social media to interact with investors on a daily basis
• 52% of social media users would interact with their advisors via social media if they were using it

Getting Started
Getting started with social media is easier than you might think. Here are four things to keep in mind:

• Know Your Goals — What are you trying to achieve? Build your name or brand? Save time or money? Reach new clients? What kind of people? Parents or professionals?

• Know Your Brand — What can you bring this audience? What expertise or resources do you — or perhaps your firm — have to share with this target audience?

• Choose Your Platform — LinkedIn is great to network with other professionals; Facebook is your place to connect on a personal level with friends and family; and Twitter is useful to engage with influencers such as thought leaders, other professionals, and even the media. You don't have to start with all at once. In fact, it's often easier to choose one platform and then grow from there. Be sure to remain compliant.

• Measure Results — Results aren't always measurable in terms of new clients. Some advisors enjoy the branding effect — which can lead to speaking opportunities and word of mouth. Others might measure the number of people who join a group or who request a meeting or phone call.


Jennifer Openshaw is president of Finect, which provides compliant social media services to adviors. The website is finect.com

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