LinkedIn is for colleague. Facebook is for clients.
While that might be a tad oversimplified, it's one of the findings of the Putnam Investments 2014 Social Advisor Study, which looked at how financial advisors use social media.
According to the study, LinkedIn remains the top choice for business users, and serves 55 percent of advisors as their primary social media site. However, they mostly use it for interaction with other advisors and financial professionals. The 24 percent who use Facebook, on the other hand, rely on that network primarily for strengthening client relationships — and more advisors are flocking to Facebook. Google+ and Twitter also have seen increased advisor traffic.
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Overall, advisors are using social media more—or using more social media. While last year the number of advisors who relied only on a single social media outlet was 33 percent, this year that number fell to 25 percent as advisors broadened their usage. Some really stretched their horizons; those who use four or more social media networks for business has more than doubled, from 11 percent to 25 percent.
Using social media pays off, too, according to the study. While the last version of the study found that 49 percent of advisors who use social media for business reported that it helped them get new clients, the current version indicated that 66 percent of that group now find it useful for adding to their client base. In addition, advisors who use social media to bring in new clients said they've booked a median of $2 million in new assets because of it — and that's nearly triple the level that last year's respondents reported.
Female advisors appear to be using social media more effectively to win business. The number of women advisors using it for business purposes has doubled to 29 percent since last year, and they're more likely to be using social media for business in the first place — 82 percent to 73 percent. In addition, they're more likely to say it's a major factor in their practice marketing efforts (67 percent to 52 percent) and more likely to get new clients through that means (71 percent to 64 percent). They get about the same level of new assets — that previously mentioned $2 million — as male advisors for their efforts, though.
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