Advisers Gain Clients and Assets Using Social Media

Financial advisers are making more use of social media than they were just a year ago, according to the Putnam Investments “2014 Social Advisor Study.” The analysis shows 66% of advisers using social media for business indicate that the channel has helped them gain new clients, up from less than half (49%) a year ago. Additionally, advisers acquiring new clients report booking a median of almost $2 million in new assets as a result, nearly triple the level compared to last year.

The survey reveals one-quarter (25%) of advisers use only one network for business purposes (down from 33% last year), while another quarter (25%) utilize four or more networks (up from 11%). LinkedIn remains the most popular business site, used as a primary social network by 55% of advisers. Facebook gained usage with 24% reporting a business presence on the network. Among advisers defining LinkedIn as their primary social network, the most prevalent use of the network is for connecting with other advisers and financial professionals. Among Facebook users, the main goal is enhancing current client relationships.

“We’re seeing a remarkably rapid and dynamic evolution of social media use as advisers test ways to make this work for their practices,” says Mark McKenna, head of global marketing, Putnam Investments. “A year ago, the focus was almost entirely on business content and professional networking. Increasingly, advisers are leveraging the more personal side of social media and getting results.”

Survey results indicate the typical financial adviser using social media for business is active on an average of three social networks and has 11 years of industry experience. The typical adviser in the survey runs a book of business with an average of $84 million in assets and $900,000 in median client assets. 

Most advisers (75%) make at least some business use of social media, although female advisers are more likely than men to use social networks for business (82% vs. 73%). They are more likely to say that social media plays a significant role in their practice marketing efforts (67% vs. 52%) and likelier to obtain new clients through social media (71% vs. 64%). Additionally, the proportion of female advisers using social media for business has doubled over the past year, to 29%. Both genders remain about equal in terms of their median asset lift, Putnam says.

Looking ahead, research reveals the number of advisers using social media for business may be at a standstill. Of those not active, only 16% are “absolutely certain or very likely” to start in the next three years, and 21% are “somewhat likely” to do so. Advisers not using social media for business overwhelmingly cite compliance limitations as the main reason.

The study was conducted among 729 advisers nationally who have been advising clients for at least two years. The complete survey can be accessed here.