Engaging Clients in a Digital World

Establishing an online presence and connecting with clients on digital mediums has become critical for financial advisors when it comes to building relationships and drawing in future clients. Creating unique, personalized, and authentic content is essential to stand out amongst the sea of other financial advisors.

At SIFMA’s 2023 Social Media & Digital Marketing Seminar, marketing experts, compliance professionals, financial advisors, and leading names in technology, social media, and regulatory bodies gathered to explore innovative opportunities to engage clients, including the latest tips, trends, research, and case studies.

Three key takeaways arose from our far-ranging discussions:

1. A digital presence is needed, but not on all platforms
2. Personalization and authenticity are essential when using social media
3. Artificial Intelligence (AI) and machine learning will have a profound impact

Before we dig into these takeaways, we wanted to share some key findings from the Putnam Social Advisor Survey 2023, presented at the Seminar by Jayme LaCour. There were some surprises:

1. More advisors are using social media for business than ever – 94%
2. LinkedIn has become the primary network for 4 out of 5 advisors; its growth, however, is driven by compliance and is not necessarily an indication of its superiority to other platforms
3. Advisors are seeing social media differently post-pandemic and post-SEC Marketing Rule, where a meaningful number of firms revised their policies
4. The significance of social media in marketing efforts has declined, but advisors can – and do – grow their business using social media with action and attitude
5. Those advisors who focus on resonant content are seeing success: advisors who gained clients spent an average of just 1.1 hours per week creating or sourcing original content

Download Jayme’s presentation slides for detail on these topics and more. We’ve pulled just a few below.

A digital presence is needed, but not on all platforms

Today, people are obtaining and digesting information on various digital mediums (Reddit, TikTok, Instagram, and LinkedIn). “Not having a social media presence in the future is not an option if you’re going to be a successful financial advisor,” said Christopher Beavers, Managing Director at Beavers Wealth Management of Raymond James.

With the next generation of digitally-savvy investors already arriving, it is essential that financial advisors have a digital footprint established. When this new generation is shopping for advisors, the advisors need to be present on social media when the opportunity arrives thereby positioning themselves for what Beavers calls the “first-mover advantage.”

Although it is important to have a digital footprint, advisors do not need to be on every social channel. “Your advisors actually don’t need to be on every channel,” said Doug Wilber, CEO at Denim Social. “They should be focused on channels where they can be their authentic self, where their audience is, and creating content that ultimately is of value that they feel comfortable distributing.” The business that financial advisors are in is a relationship business and they should know their clients. “The conversation that you would have with a client in real life should be the same conversation you’re trying to facilitate on social media,” says Wilber.

Video is an incredibly engaging platform that encourages authenticity (more on that next). It adds a personal touch and naturally builds relationships. “More and more of our wealth management clients are thinking about video and how to leverage video in a more appropriate way for their different customer segments,” said Raazi Imam, Managing Partner, Global Lead for SiaXperience at Sia Partners. Using video allows advisors to add a personal touch to their content and connect with potential clients on a digital medium.

“YouTube is great, both short-form and long-form video,” says Imam. As an example of short-form video, Christopher Beavers shared his approach to “Beaver Nuggets,” or short educational videos on various financial topics that can be utilized and shared by clients.

Some platforms are riskier than others, of course. “TikTok requires a lot more time and effort, and also a lot more oversight,” says Imam, explaining that the need for volume can risk depleting relevancy. The platform also requires more oversight on security.

Personalization and authenticity are essential when using social media

Clients “want to know who we are at our core as people because it’s a relational type of business, and they also want to know why we do what we do,” said Nora Yousif, Senior Vice President, Financial Advisor, at RBC Wealth Management. The theme for 2023 on social media is personalization, notes Raazi Imam. It’s important to build this authentic online presence to draw in and create a relationship with the next generation of investors using these digital platforms.

“According to a recent study by a financial service company, one-third of Americans trust social media, including influencers and celebrities, to make a decision,” noted Owen Donley, Chief Counsel, Office of Investor Education and Advocacy, SEC. For the service industry especially, users will search for information and judge credibility on social media platforms. “There’s this understanding that they need to go and validate what they’re seeing, where they’re seeing it, and who’s actually giving that information at the start,” says Traci Mabrey, General Manager, Factiva, at Dow Jones.

Posting content that is authentic and real is important to users who come across your digital profile as it helps build trust. As the industry matures in our use of social media and continually refines our use cases, this is the logical next step. What does authentic mean? What is resonating? Where are we seeing the most success? “Authentic voices are key. That is so true. Take time to write your own posts. Yes, it’s more work but it is well worth it…the less perfect, the less glossy, the more real it is, the better,” says Yousif.

Many advisors are trying to navigate what the right amount of content is between personal life, financial education, and business. Sarah LeBlanc, VP of Marketing Consulting at LPL Financial, noted that she tells advisors who are trying to figure out the “right mix” to think about it as if they’re taking one of their clients out for lunch to talk about their portfolio. If they’re talking more about personal life than business, then that should be represented on their social media platform and vice versa. “It really just comes down to what is authentic to you,” says LeBlanc. “I’m really excited that word authenticity has come up so much today because I think it’s really key to success.”

Artificial Intelligence (AI) and machine learning will have a profound impact

A key topic of discussion was Artificial Intelligence (AI) and Machine Learning (ML), most notably, ChatGPT. Participants at the Seminar discussed the potential risks and benefits that this new technology could have on financial advisors and the digital world.

Michael Lestina, Digital Channel Executive at Merrill Lynch Wealth Management went to ChatGPT directly to ask what impact it saw itself having on the financial services industry. In addition to brainstorming ideas and producing quick social media posts, ChatGPT told Lestina it can be used for:

• Customer support
• Risk management
• Fraud detection
• Investment recommendations
• Compliance

“I really think technology, AI and machine learning are actually friends of managing risk,” said Patrick Yip, Director at BNY Mellon.

Despite its potential, ChatGPT is not 100% accurate and can provide false answers. “As with anything you’d find on the Internet, there’s no lack of examples of false information out there, so like with any technology, trust but verify,” said Carmen Gary, SVP, Chief of Staff at D.A. Davidson & Co.Other panelists viewed ChatGPT as a perfect machine learning use case. “Machine learning can just make it smarter and smarter, explains Yip. “So, it really hones in on the things that you should be looking at, based on what you were doing, what you were looking at in the past, and just make the user experience more elegant and efficient.”

There is also speculation that ChatGPT can be subject to manipulation. Panelists were also concerned about how to create certain boundaries for this tool so that it operates exactly how they would intend it to work. All this aside, ChatGPT cannot provide the emotional connection that clients have with their advisors. It remains, like all technologies, a tool for enhancing and not replacing the client-advisor relationship.

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Many thanks to all of our participants, speakers, and sponsors – Denim Social, Hearsay, Proofpoint, and Smarsh – for another fantastic event.

To continue the conversation, join us at the 2023 Private Client Conference. We’ll be exploring the future of wealth management – including these issues and more – from May 3-5 in Fort Lauderdale.

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Melissa MacGregor is Deputy General Counsel and Corporate Secretary for SIFMA.

John Maurello is Managing Director, Private Client Services for SIFMA.

Related Resources

• Event

  Social Media & Digital Marketing Seminar

• Event

  Private Client Conference

• Committee

  SIFMA’s Private Client & Wealth Management Committees