Is social media essential for IFAs in the digital age?

It is fair to say that some IFAs have been tentative in embracing the use of social media in a professional capacity. In an industry dominated by rules, regulations and compliance requirements, it’s easy to understand why the idea of regularly posting content online might be seen as too risky (and too time-consuming) for some. However, the profession is changing. According to a LifeQuote survey, nearly two-thirds (60%) of all financial advisers now have a professional social media presence, a figure which is broadly in line with our own recent audit of social media use among IFAs. Of the 250 firms TOMD researched, 64% publicised the use of at least one social media account, with the three most popular platforms being Twitter (56%), LinkedIn (51.6%) and Facebook (38.4%).

It’s increasingly true that, as digital marketing grows ever more pervasive, potential clients now expect not only to be able to find a firm via its website, but also to be able to interact with it on a variety of social media platforms. Indeed, consumers and businesses may potentially be suspicious or mistrustful of a company without a social media presence.

This is just one of the many reasons that IFAs are now opening up to using social media as a marketing tool. According to Intelliflo’s 2018 social media survey, being seen to be keeping up with modern communications systems was the top reason financial advisers gave for having a social media account (56%), closely followed by attracting new clients (54%) and keeping up to date with financial news and events (43%). It is clear that the risk of not having an online presence is that of isolation – social media provides IFAs with much-needed information on wider industry developments, as well as effective ways of engaging with and targeting potential new clients. And, of course, potential clients looking for an IFA could equally find you on LinkedIn.

A further benefit of having a social media presence is the opportunity to share your knowledge and experience with a wider audience and so strengthen your reputation. Again, with a subject as sensitive as people’s personal finances, potential clients want to know that the adviser they choose knows what they’re talking about. Posting insightful articles, linking to relevant blog posts and engaging with consumers about financial topics online all help to create the impression of trustworthiness and competence clients are looking for.

While all of the above may be true, equally valid are many advisers’ concerns about the difficulties of adhering to FCA compliance regulations, which apply to social media just as they do to any other area, when posting content online, especially when social media posts need to be topical and there can be a delay in obtaining approval. Some IFAs may also feel that the time and effort it takes to grow or even just maintain a social media account is hard to justify, especially considering that the typical client profile has historically fallen into older age cohorts among whom the uptake of technology and the use of social media have been lower. Added to the fact that word-of-mouth and referrals from existing clients are time-tested and often successful methods of securing new clients, it is perhaps easy to see why digital marketing and social media have not appealed to many IFAs in the past.

On the other hand, and as we have previously said, the industry is changing and advisers who don’t adapt now could find themselves left behind. So, if you’re an IFA thinking of taking the plunge into the digital world, here is some advice that may help you take that first step.

Advice for IFAs on social media

• It’s important to have a social media strategy or plan in place in your firm, highlighting what you are trying to achieve and the topics or areas you want to cover.
• Each platform will take time to grow and maintain so set up one platform at a time – it’s better to support just one platform well than three badly.
• Treat each platform differently, as they each have different dynamics and users have different expectations – don’t use the same posts for each one.
• You’ll need to ensure compliance with FCA regulations; to help firms with this, the FCA has published its own set of social media guidelines, which outline in detail its requirements for compliant social media content.
• Firms should avoid having a sporadic, “post-when-I-have-a-spare-moment” attitude to social media, as regular posting, fresh content and frequent interaction are essential to a successful online presence. Ideally, you would appoint an individual or team whose job it is to deal with your accounts, and outline a coherent strategy for scheduling posts, sharing content and responding to followers’ comments or queries.
• A social media account shouldn’t purely be used as a tool for self-promotion. It should also be used to join in with industry conversation and commentary, share your knowledge and build trust and stronger relationships with current and prospective clients. The general rule of thumb is that, for every one thing you post about yourself, you should have four more general posts relating to the world of finance, industry news or even the odd fun or humorous post that shows a bit of personality!
• Finally, don’t expect too much too quickly. Engage with your audience, keep posting regularly, and use the analytics tools on your accounts to get an understanding of the kind of content your followers enjoy – and you’ll be off to a good start.

By Chloe Wingate