How To: Social Media for Retirement Plan Advisers

Art by Patrick Edell

Financial advisers have long understood the importance of forging a personal connection with their clients and prospects. But as people increasingly rely on social media and other digital means of communication to connect with their friends, families and the broader public, there has been some debate about the best ways for retirement advisers to leverage social media as a means to promote business growth and deeper client connections.

Mark McKenna, head of global marketing at Putnam Investments, says advisers’ use of social media platforms has evolved over time and will certainly continue to do so.

“I used to hear advisers who said that they didn’t have time to learn a new communication medium or technology,” he says. “Now they are all asking, ‘How do I use social media in best way?’ Today, most advisers realize they can reach targeted individuals on social media far more effectively than just doing a seminar. Social media is more efficient and it helps create a dialogue.”

As noted in the 2019 Putnam Investments Social Advisor Study, back in 2013, only 5% of advisers were using Instagram for business purposes. Today, that number has risen to 38% of financial advice professionals. LinkedIn, meanwhile, was already used by 71% in 2013, rising to 72% this year. Use of Facebook is up almost 40 percentage points (62%) compared to 22% six years ago, while Twitter use increased from 16% of advisers to 52%.

“What the social savvy adviser is doing is using all forms of social media, from LinkedIn to Instagram, Twitter, shared news, etc.,” McKenna observes. “We used to see advisers act as listeners. They didn’t take that next step and actually use social media for real prospecting, or to build their brand as educators in the marketplace. That’s what I think we’ve seen change the most, advisers think ‘I’m going to now engage, I’m going to retweet or repost an article that I know is really interesting to these groups.’”

Atlanta Retirement Partners, a financial services firm based in Atlanta, heavily relies on LinkedIn for research, whether it’s searching for background detail on prospective clients, deciphering who has decisionmaking authority when it comes to potential workers, and who may have a working relationship with a customer, says David Griffin, founder of the firm.

“We do almost everything through LinkedIn, it’s the easiest way to target those people who are decisionmakers for institutional type plans,” he adds. “We find that this preparation strengthens your relationship with your prospects and customers. You can talk about things that are important to them or their business.”

The social networking platform even exceeds the effects of email messaging, which can at times feel like noise due to its oversaturation. LinkedIn Inmail, adds McKenna, is a much more powerful tool when it comes to communication.

“If you look at your LinkedIn and you see you have a message, you feel fairly compelled to respond to it,” he suggests.  

Stepping back, the Putnam study shows that even though 83% of U.S. advisers are applying social media communications in their practices, and six in 10 advisers label themselves as social media experts, only 15% are “demonstrating high skilled approaches.”

McKenna doesn’t consider this finding a failure of financial professionals, as it takes time and resources to become a social media expert. For advisers looking to up their social media game, he suggests doing some benchmarking of their social media practices against other firms to understand how they score in comparison. One way to do so, he says, is through Putnam’s Social Advisor Maturity Curve, a quiz that places financial companies on a spectrum of social media expert levels, from beginner to intermediate, professional, and of course, expert.

“A lot of advisers have this confidence that they’re very talented in what they do, and they are, but when you assess them against their peers, they find that they stack up in a different quartile than they thought,” McKenna says. “What we wanted to do was bring this to the forefront, to raise the point that it’s not just okay to hang out on social media, you have to be active user.”

At the end of every test, depending on performance level, the quiz will recommend steps to maximize social media practices, such as investing in paid promotions on Facebook and sharing strategies with colleagues. And while retweeting a sponsored post or reaching out to clients via Linkedin InMail can have positive effects, McKenna argues that it’s those advisers searching for innovative avenues to grow their social media presence who will find victories from their efforts.

Importantly, even on social media, financial advisers must remain vigilant to stay compliant. McKenna has seen more advisers submitting graphics, charts and content to the Financial Industry Regulatory Authority (FINRA) before posting online, in order to acknowledge any appropriate foot or compliance notes.

Because of this rise in business communications platform usage among advisers and financial professionals, FINRA has created its own topic page, guidance and notices catered to helping advisers remain compliant when using social networking websites.