By Mike Byrnes
Advisors are finding that social media is more helpful than just sharing silly things like what you ate for dinner last night.
At the a FPA retreat, three panelists said they stumbled upon social media in different ways and have become believers of its power to communicate on a large scale.
Finding A Use For Social Media
Carl Richards, founder of Prasada Capital Management, joked, "I got started because I had an opinion and found nobody in my house would listen to me." Richards is known for drawing sketches that capture complex investor behavior. When it came to using social media, he admitted he had "no grand plan." It started with his sketches to help clients understand his advice and it evolved into the New York Times asking him to do a drawing each week. "Chances are that as crazy your ideas are, there is someone out there that will agree with them," he said.
Richard Kahler, a fee-only advisor and faculty member at Golden Gate University who has almost 100,000 views on YouTube, said he has always been a writer. "It seemed intuitive that I start blogging," Kahler said. He said his firm shifted communications online, saving a lot on postage. Then he discovered something interesting: During the market crash, there was a direct correlation between clients who did not panic and those who opened the firm's e-mails, which helped him realize the value of online communications.
Tim Maurer, vice president of the Financial Consulate, originally didn't think much of Twitter and other online networks: "I didn't see the value in social media. I thought it was how people cheated on their spouses by finding old lovers." His public relations contact finally told him, "You have to do this" to market his book.
Maurer had a client who said, 'The writings are good, but it would be better if I could see your face." His firm then experimented with putting videos online. "Within a month, we got picked up by the Wall Street Journal for using this technology." He viewed that as ironic since "I was a late adopter."
Social Media Insights
"We ask every client if they would like to connect [online]," Kahler said. "With Facebook, we have all ages. It is more tilted to 30 somethings, but we have clients in their 50's and 60's, too."
"Be very clear about your goals," Richards said. However, he said it's hard to measure expectations with online activities. With "Nick Murray math," you have an idea of how many calls you need to make to get a certain amount of leads and how many of those individuals you can convert into clients, he explained. With social media, there are no preset formulas, he said.
Maurer thinks social media is an extension of himself and his firm. He feels strongly that social media is a great tool to use in a relationship-driven industry.
The panel seemed to agree that a handshake might still be the best way to meet someone, but social media allows firms to reach more people, many of which a planner would never get to know.
Kahler believes it is hard to quantify social media's impact, but he said, "50% of my new clients say they found me on the Internet."
Advice Of Others
"You can hire someone to tweet or e-mail for you, but that is a bad idea. These are relationship tools," Richards said. He said to block time on a weekly calendar to dedicate to social media. But he also said advisors should not overdo it because it is easy to get sucked in by social media.
"I run 50% of my practice from my smart phone. Everything is interconnected," Kahler said. While on vacation, for example, his wife was so happy that he was "really there" instead of being busy with social media. He laughed because every time she turned her back he was on his phone checking in.
"Social media actually gives traditional media legs," Maurer said. That is because it allows traditional media to expand its communications and penetrate into areas that it would not normally reach. "I started by accident, but now it is purposeful," he said.
A News Source
Of the three most well known social networks, Twitter is the least understood by planners. Maurer clarified the confusion, saying, "The primary benefit of Twitter is not what I sent out, but what I get. It is a listening tool." By following the right individuals, you can get all the news you want. Because of this, he added, "I stopped getting papers."
Kahler emphasized how Twitter has become the quickest way to get news, noting he first learned about Japan's disaster through Twitter.
An Audience Success Story
Patrick Dougherty, the founder and president of Dougherty Wealth Management, shared his recent experience with social media, saying, "Recently, a nonprofit held an after-work happy hour at a popular spot in Dallas. To market to this group, we used traditional mail, Facebook, Web site communications, and an e-mail campaign, which included 5,000 email addresses. The event was a huge success, with all attendees coming from Facebook. It made a believer out of me and I realize I need to incorporate social media into my practice."
Compliance Catch Up
In a show of hands, just a few planners said they had policies in place to guide their firms' social media use, even though many were actively using it. In another show of hands, few planners said they were using an archiving solution.
Bill Winterberg, the moderator of the panel and a technology and operations consultant, advised the attendees they should be able to provide all communications upon request. "In my opinion, there is no difference between the e-mails you send to clients and the message you send out on social media networks," he said. "Advisors are required to archive all communications, and that includes tweets and Facebook updates."
Are They Now Believers?
Kahler said social media can be a good retention tool, but those considering using is should consider the question, "Do you really want the world to see who you really are?"
"It is part of how I communicate, it is part of how I do things," Maurer said. "It is a great client retention tool. If you don't like it, don't do it. But I do think you should try them all first."
"It has opened a whole new career for me," Richards said. He hoped that through social media the industry could shift from a secret society of planners to one where the real planners begin to develop trust. "Just by extending the conversation it holds a huge value," he said.
"In today's connected world, advisors don't find clients, clients find advisors," Winterberg said. "They find advisors through content published on blogs, social media and video Web sites."
Follow what was tweeted about the FPA Retreat with this Twitter hashtag: #FPARetreat11
Mike Byrnes, founder of Byrnes Consulting, helps advisors become more successful. His expertise is in business planning, marketing strategy, business development, client service and management effectiveness, along with several other areas. Read more at www.byrnesconsulting.com.