The Social Advisor: Using Social Media Effectively in Wealth Management

Eighty-seven percent of US adults with an investment account visit social networks regularly. Learn how wealth management firms can use social media to improve customer acquisition and retention.

In 2011, regulatory authorities in the United States and Canada began allowing financial advisors to communicate on social networks. Several firms, including Morgan Stanley Smith Barney, LPL Financial, New York Life and Raymond James, took the opportunity to begin exploring how social media tools such as Facebook, LinkedIn and Twitter could be used in a wealth management context.

Now, these same companies and others are shifting from social networking pilot projects to "socially infused" marketing and sales channels. In this report, Accenture identifies the steps that firms can take to ensure a smooth transition.

Download the full report [PDF, 506 KB]

According to Forrester Research, 87 percent of US adults with an investment account visit social networks regularly. In fact, over 50 percent of those between 55 and 65 visit at least monthly—if not more often. These same investors are more willing to use a mix of advice and self-direction when making investment decisions.

For an advisor, social networks offer a new way to gain valuable insights into the interests and concerns of existing and prospective clients. For an investor, these online tools are a chance to learn more about a particular financial advisor or compare wealth management firms.

Social networking tools have the potential to transform how wealth management firms and advisors interact with consumers, but the challenges are significant.

At the individual level, advisors who are on social networks are less confident in their use of these networks to drive business than they were one year ago.

At the firm level:

• The novelty of being active on social media is wearing thin as more advisors get involved.
  
  
• Many firms struggle to provide different content than their competitors.
  
  
• Adding social networking tools to existing channels is not free.
  
  
• Many firms have difficulty measuring social media’s return on investment.
  
  

Wealth management firms looking to integrate social networking tools into their operations face numerous challenges. To increase their chances of success, they should focus on:

• Understanding how social networks affect customer experiences.
• Integrating social media platforms into the firm’s technology architecture.
• Establishing processes and procedures for using social media.
• Providing ongoing social media training to advisors.
• Ensuring content reflects the firm’s brand and the advisor’s character.
• Using analytics and data integration to attribute social interactions to business outcomes.