Executive Summary
Most planners struggle to grow their businesses and bring in as many clients as they wish. With the surge of social media in recent years, from Facebook to Twitter to LinkedIn, an increasing number of consultants have hailed social media as the great marketing equalizer, capable of allowing even small planning practices to establish a marketing presence. Nonetheless, most planners are thus far reporting limited success with their social media efforts; a recent study suggests interest may already be waning. Yet at the same time, most planners have had little success with any form of targeted marketing efforts, relying instead of the slow flow of referrals from existing clients as a primary source of new business. Which raises the question: is it that social media in really ineffective for growing a practice, or is it just that our woes with social media are representative of our ongoing difficulties in clearly defining the value we provide and the target clientele we wish to reach, leaving referrals as the only option left?
The inspiration for today's blog post comes from a recent article cited in last week's Weekend Reading, discussing research results from the Aite Group showing that marketing through social media is losing some appeal amongst advisors. The article notes that "the absence of benefits from social media may be muting advisors' views of the potential impact of social media on business objectives." In other words, advisors are losing interest in social media for marketing because they're not seeing the results. Consequently, they're leaning back to their old business development stalwart: referrals.
Is Social Media An Effective Financial Advisor Marketing Strategy?
Yet I can't help but wonder if the disenchantment that planners are having with social media's weak results are because... well, most planners are doing a weak job implementing social media. Effective social media - or really, any form of effective marketing - is about communicating information that's relevant and pertinent to your target prospects, that engage their interest and draw them to learn more about what you offer. Yet in reality, many planning firms are so broad and undefined in who their target prospects are - for instance, stating their target clientele are "anyone who can afford my services" - that it's no surprise social media is ineffective. Because the target clientele are so vague and undefined, it would be impossible to target relevant and pertinent information at them in the first place! This is why it's ultimately so crucial for financial planning professionals who wish to grow their businesses to develop a niche - because when you do have a clearly defined target market, it's radically easier to reach out to them to communicate!
For instance, look at how Kristin Harad reaches out to New Parents trying to plan their finances at the clearly named NewParentFinances.com, or Brittney Castro seeking women to want to empower themselves and their relationship with money to become FinanciallyWiseWomen(.com), or Jim Blankenship positioning himself as an expert available to those making decisions on Social Security benefits as the publisher of the SocialSecurityOwnersManual.com. All of these websites tie to blogs, Twitter, Facebook, and/or social media accounts... delivering messages that are directly pertinent and relevant to their target audience.
The Average Financial Advisor Blog Is Not Successful Because It's Not Unique
These can be contrasted with the "average" financial planner's blog, which, I'm sorry to say, communicates virtually identical basic financial planning tips as every other average financial planner's blog. Articles might include tips for tax loss harvesting, or developing a budget, or the ill-guided explanation about why their competition is ethically inferior... all written in a manner so general, it could be for anyone. Which is exactly the problem. Because even if a prospective client actually needed your personal help to address one of these issues, the prospect probably wouldn't find your content, anyway. A Google search would turn up someone else's website first. The prospect's friends will likely share content from someone else's website that felt more personally relevant and connected. Your content won't connect, because it wasn't targeted to them, didn't communicate to them effectively, and therefore wasn't differentiated from everything else out there on the web. In other words, while it's true that nothing dies once it's on the internet, it's nonetheless true that it may never ever be found, either.
So it appears to me that "most" social media fails, simply because its content is so general and for everyone, that it fails to connect personally with anyone. And in turn, it's content that anyone who does read would probably not feel compelled to share with anyone else, because it is so bland and undifferentiated. Which means, in essence, planners may be relying on personal referrals because their social media content itself isn't very referrable in the first place.
This doesn't necessarily mean that social media is for everyone, or that all planners will excel with social media. The point is that the more effectively your business and marketing are targeted, the more effective tools like social media can be to growing that business. And from the opposite perspective, difficulties in obtaining social media results are often more the result of a vague, undefined value proposition and target clientele, than a flaw in social media as a marketing tool. Yet ironically, a planner who succeeds in clearly defining a value proposition for a well-defined niche clientele becomes more referrable altogether - both for in-person referrals, and social media sharing!
So what do you think? Do you use social media for marketing? Have you had any success with it? Is your content so general for everyone that it may not connect very well with anyone? Can you clearly articulate who you're trying to work with, in a manner similar to the other planners mentioned here? Is your content really written in a manner that would be compelling to them (your target audience), not just to you as the writer?
Great post, Michael. I saw that piece and was similarly perplexed by the conclusions.
My sense is that you are right on about content. Most people who are new to social media don’t understand how important content is to the equation – and how important their *personal* take on content is to the equation.
The professional is trained to check their personality at the door to the office, yet it is precisely this personality and know how to leverage it professionally that creates success in business – ANY business and EVERY business.
I also think that time frames for social media success are set unrealistically short. You don’t succeed in building trust and good reputation online in 3, 6 or even 12 months. It takes at least a year and I tell people to give it 2 or 3 – YEARS.
But if you stick with it and consistently add value, if you invest your heart in soul in becoming a student of the new media, if you truly and honestly engage with prospects, clients and colleagues, you WILL SUCCEED. It’s just a matter of time.
And for those who are too busy or too distracted or too afraid to put in the hard work building trusting relationships online, I suggest they need to rethink their business plan. 2012 is here and social media isn’t going away.
Jay,
You have an interesting point that the engagement aspect of social media directly contravenes our ingrained professional tendency to check our personality at the door and be the “purely objective” advisor. That’s a really good point.
But I think in most cases, the problem is simpler than that. As you note – and I certainly agree – effective social media as a marketing tool involves/requires good content. And most advisors simply don’t know how to create good content. That’s not judgmental; it’s simply not a skillset that most people have.
But for an advisor who’s not going to be effective at creating good content, then social media is going to be a real lackluster solution. If it’s also not targeted effectively, it just suffers all the more!
Respectfully,
– Michael
Michael,
It’s refreshing to find another professional out there in the financial advisor social media universe who understands the critical value of defining a target market, and the importance of crafting unique, interesting content that is relevant to that market.
I’ve turned away or essentially “lost” business with my firm [Wired Advisor- financial advisor blogging platform] due to the lack of a canned content solution, and you know what? I’m OK with that. Advisors have been spoiled by canned content solutions for years and that fact has significantly stifled their ability to be successful with any kind of marketing…seminars, emails, websites, and now blogs and social media. It’s just, well, lazy marketing.
The truth is, I could plug in any old content solution at my firm and provide the plug and play solution, but what an incredible disservice to advisors, the industry, and really my own deeply held beliefs about what it takes to stand out in a wired world. I’d rather attract those true financial advisor thought leaders out there and help them uncover, develop and amplify their true thought leadership message!
Brittney Castro has taken these social marketing “tools” and carved out a unique, powerful, positive personal media new media profile for herself! Her content is fresh, exciting, creative, engaging, varied, and targeted. The others you mention are doing a great job as well. These are the kinds of advisors who are going to succeed (and already are)in the age of new media.
Having seen you consistently on my social media radar…your thought leadership message has continued to drip on me and capture my attention. By the way, isn’t that the way “social” is supposed to work? We make new connections and build relationships with people who communicate messages that are relevant and meaningful to us.
Thanks for the article Michael. I’m glad your voice is out there spreading the good word 🙂
Stephanie
Stephanie,
I find canned content to be the antithesis of social media marketing. Almost by definition, social media must be SOCIAL – it must represent an interaction between YOU and the people you’re trying to communicate with. Canned content doesn’t do that. There’s no “you” in the content for people who follow it to build a relationship. On almost by definition, canned content isn’t differentiated from all the other people who offer that content.
That being said, I do think the “content question” in social media marketing is a serious one. Most people do not have much skill – much less a gift – for writing and communicating their messages. Obviously, the situation is only exacerbated when they also don’t even have a target audience to communicate that message towards. But there is a “gap” out there to me, in how you get the compelling content created for someone who wants to utilize social media marketing but doesn’t have the personal skillset to create PERSONALIZED content.
Respectfully,
– Michael
Great comments here. Stephanie’s suggestion that social media will become a “critical business component” is prescient.
When pioneers left Westport to cross the plains in American settlement history, they didn’t go alone, nor can we. The best technology, best techniques and best guides are queuing up to help anyone who wants to master this new technology.
Now is not the time to be timid. You’ll fail. Since 2003 we have understood how to give advice online. For the last two years we’ve been learning, with great online advisors, how to draw a crowd and create the online relationships that will bring success.
Everyone in this thread is making a contribution. As we pull our conestoga wagons onto the plains, there will be plenty of skeptics jeering from the comfort of the status quo. Let ’em. The future belongs to those who engage it.
Good post, as always Michael. I use social media as a strategic marketing tool mainly because:
(1) I enjoy blogging (I do have a rather unique take on money, being a behavioral finance geek) and
(2) Most financial planners (at least in Buffalo) do not use social media because of the compliance restrictions. Subsequently, when people Google “financial planners”, I have so much presence on the internet, I come up right away. Most of clients found me via Google.
I haven’t given up on referrals, though.
I’ve been banging that niche drum to my colleagues for years, it’s SO true. My niche? People who are college educated, spiritual, take yoga classes, have had therapy and, curiously, have last names that begin with “K”.
Keep up the great work,
Amy Jo
Hi Michael
Just read your post. Very insightful and relevant. I completely agree with your point that though advisors have launched themselves on social media, a clear lack of identification of target segment and putting oneself in customer’s shoes leaves a sour taste when one measures the ROI from the marketing efforts (if at all its done)…
One of the major misconceptions in social media as a means of marketing is that it is zero cost. Since creating an account on social sites is FREE, does not mean that the cost is zero. One should consider the time spent in developing good quality content is in fact a cost. This also should propel the advisor to take some time out and effectively track the ROI from various sources, so as to optimise the efforts in a better way.
And one thing I am realising, even with a great segment-specific and focussed content, social media takes time…there is no magic out there..one needs to stay persistent and with an attitude to really put the potential customer’s financial life a bit better and build trust…and then the results start showing…
The post has given some food for thought to me..thanks.
Abhinav