Whether you friend, connect, or tweet, chances are your practice's use of social media for networking and business interactions is growing.
American Century Investments' sixth annual Social Media Adoption Study indicates that 62 percent of financial professionals this year say they have moderate to extensive social media experience, up from 51 percent last year, while 29 percent only have a basic use, down from 38 percent last year.
The most popular social media sites used are:
- Facebook (75 percent)
- LinkedIn (70 percent)
- Twitter (37 percent)
- YouTube (27 percent)
- Google+ (25 percent)
- Instagram (23 percent)
- Blogs, photo-sharing sites, and podcasts (10 percent each)
Okay, so financial advisors aren't online Luddites. But are those friends on Facebook, connections on LinkedIn, and âtweepleâ (yes, that's what they're called) on Twitter actually bringing in any bucks or business benefits? That's where things aren't quite so upbeat.
Here's a snapshot of the study's findings. (A caveat: The findings are based on a sample of 309 respondents nationwide, and they were mostly financial planners, advisors, or personal financial consultants. Study participants averaged 17 years in the financial industry, roughly 71 percent were male, and the average age was 50.)
How does a connection with someone for business purposes on social media affect the likelihood of doing business with them?
More than half (52 percent) of respondents said it was more likely, 45 percent said it would have no effect, and 2 percent said it was less likely.
What is the value of social media for business?
- Little value: 23 percent this year, up from 13 percent last year, but about the same as the 22 percent in the first year of the study in 2010.
- Significant future potential: 54 percent this year, down slightly from the prior four years that hovered at 56 percent and 57 percent, but up from 2010's 44 percent.
- Already producing tangible results: 26 percent this year, up from last year's 17 percent.
- Has value for the business: 44 percent this year, up from 35 percent last year and 26 percent in 2010.
Have you gained a new client or a relatively large amount of business from an existing client, in part, because of social media efforts, and how much?
- No new clients or added business: 57 percent
- Under $1 million: 27 percent
- $1 million to less than $3 million: 10 percent
- $3 million to $5 million: 4 percent
- More than $5 million: 3 percent
What are the top three business uses for social media?
- Reading expert commentary/insights: 28 percent, for the past three years.
- Sharing news content relative to clients: 17 percent, up from 9 percent last year.
- Researching people (prospects, current clients, contacts): 12 percent, down from 16 percent last year.
Smaller percentages of respondents indicated other such uses as monitoring industry news, branding and business promotion, posting commentary, maintaining a professional blog, competitive intelligence, sharing best practices with peers, and customer feedback.
Respondents also rated the top five social media activities that would keep them from dealing with a firm. They are:
- Lack of professionalism: 59 percent
- Privacy/data breach: 57 percent
- Political cause: 39 percent
- Irrelevant or boring content: 36 percent
- Lack of or slow response/authenticity: 27 percent
Terry Sheridan is an award-winning journalist who has covered real estate, mortgage finance, health care, insurance, personal finance, and accounting and taxation issues for newspapers, magazines, and websites. A Chicago native and former South Florida resident, she now lives in New England.