Feature: A social network


By Zoe Fielding

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Financial planners have always found it beneficial to integrate themselves into networks where they can get to know prospective clients before starting a professional relationship. Now, the evolution of social media has opened up a new and efficient channel for connecting with consumers on a personal level.

Many in the industry are keen to explore its uses, but establishing a credible, authentic social media presence isn’t necessarily an intuitive process.

Despite any perceived difficulties, Gold Coast-based Wealthfarm’s chief executive, Nicholas Sinclair, believes it’s worth the effort.

“If you’re not on [social media], you’re going to be left behind,” Sinclair says.

“On the Gold Coast, there are that many communities already and almost every day people are looking for referrals.”

Wealthfarm has been active on social media for more than three years. The business is licensed by Synchron for financial planning, but also offers accounting, mortgage finance and property services.

“Our original strategy was to be on [social media] just to be on it and build our brand,” Sinclair says.

Now, the business has strategies tailored to each of the social media platforms it uses, including LinkedIn, Twitter and Facebook. It is in the process of upgrading its website and Sinclair posts blogs on his personal website, nicksinclair.com.au.

The blogs don’t talk about the technical side of financial planning. The aim is to build Wealthfarm’s brand. Leading up to Christmas, the websites featured posts on how to avoid letting credit cards get out of control.

Sinclair wants Wealthfarm’s content to start appearing in search results when people scan the Internet for particular topics. Ultimately his goal is to have consumers on the Gold Coast bypass Google searches and think first of Wealthfarm when they need financial advice.

Sinclair hopes that by building brand awareness using social media, prospective clients will develop trust in the business long before they decide to contact an adviser.

The philosophy of using social media to get people to “know, like and trust” you is one The Social Adviser principal Baz Gardner advocates. Advisers should go into social media with the simple intention of presenting themselves and their values to the public, Gardner says.

Gardner has established himself as a specialist in social media use by financial advice firms. A financial planner himself, he has used online social networks to build businesses since 1997.

He claims some of the credit for the growing popularity of social media among financial advisers and expects the momentum to increase.

He recommends advisers start out by asking themselves questions like “what do I care about?” and “who do I like working with?”

“Planners often segment [clients] based on the value of assets or niche occupations instead of working out who they are and what they’re best at. If you want to be successful in the world of social, you first need to work out who you are or it’s not going to work,” he says.

Many advisers misunderstand social media, he says.

“They think it’s about marketing and promotion; they think either that or that it’s something kids jump onto to share ridiculous things,” he says.

When social sites such as Facebook and Twitter began to gain traction in the community, advertisers quickly noticed their value in promoting products. But that approach won’t work for advisers, Gardner warns.

“You shouldn’t be talking about strategy and product; that’s not what builds trust and relationships,” he says.

Securitor and Licensee Select managing director Matt Englund says advisers need to take care with the messages they deliver via social media. It’s essential to be open and honest, but also to steer away from giving opinions that could be taken as advice.

“Have opinions like ‘too many Australians are underinsured’ as opposed to ‘the Australian dollar is going to move to 80 cents and you should sell’,” Englund suggests.

It takes time and effort to develop and maintain an online community and he says advisers should start slowly and carefully.

“Do it constantly and methodically, and not in a big blast then nothing. It becomes problematic to sustain a big push unless you’ve got a dedicated resource, because the information becomes stale and a burden to the environment,” he says.

Businesses should be clear about who will take responsibility for social media, what discussions they will and won’t participate in and how to respond to criticism, he advises.

It can be useful to develop a social media presence for both the adviser in their own name and the business. Advisers can use their personal networks to talk about who they are, develop a history and convey their personality.

A corporate presence allows the business to create communities and groups. Clear and defined messages can help attract people who will make suitable clients and deter those who won’t.

Englund estimates that in the advice networks he oversees, around 10 per cent of practices are actively using social media as a business tool, while about half have a LinkedIn profile and almost all have a website and basic Internet presence.

Social media should not replace traditional communication activities, such as monthly newsletters, but it is an increasingly essential addition to keeping in touch with clients between meetings.

That improved communication has value, although it’s hard to ascribe it a dollar figure. A good measure is the higher quality of client attracted, Englund says.

Gardner agrees that when social media has been fully integrated into a business it becomes difficult to measure the return on investment.

But he argues that in the first year, it’s relatively easy to measure results by identifying which clients have come to the business through social media interactions.

In 2012, The Social Adviser surveyed 57 advice businesses it had worked with and found those businesses were, on average, able to directly attribute $57,000 of extra revenue per adviser to their social media activities.

Advisers can measure success in a variety of ways, IRESS Market Technology wealth management solutions senior business development executive Michael Kinens says.

That might be as simple as monitoring how many clients opened a newsletter or clicked on a blog post. It might be tracking how many people viewed a video and seeing whether that information was forwarded on.

“Those that are succeeding in this space have a methodical approach to what they’re doing. They understand the need to test and measure on an ongoing basis ... it’s a constant exercise of refining the sort of information that’s provided and tracking what’s getting a better result,” Kinens says.

Advisers can also use social media to subtly collect details about the client that will allow them to provide more tailored information which will further strengthen the relationship, he says.

There are many tools to help advisers do this. Some allow sophisticated levels of management and monitoring, but Kinens says few are using the complex dashboards available at this stage.

“Social is just another element that can form part of any business’s model. Not unlike technology, we expect that some will embrace it and others will either ignore it or half-heartedly implement what they believe to be adequate. No business will sink solely for not adopting social, but all will benefit from [it],” he says.

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