LinkedIn: “The Gateway Drug” To Social Media for Wealth Managers


The Internet has changed our entire social landscape. But although almost 100% of wealth managers have a website, it is estimated that only 10% use social media. If you are not learning about using social media to target and engage groups of people, you will be left behind.

The term Social media is a misnomer, and social media sorely needs rebranding and repositioning for itself! Our entire culture is changing the way we communicate both personally and professionally as a result of technology. The internet has made it possible for a new channel of communication between people. Wealth managers and potential investors can “meet-up” on the social media platform. It’s a way of pre-vetting a firm to learn more about them and the individuals who run it.

Financial advisors have been slow to adapt. No surprise due to the conservative nature of money managers and large institutions. Most wealth managers/financial advisors continue to eschew social media by claiming that the dreaded compliance department says no to these types of activities. This is simply not the case anymore.

With the potential unknown, the Securities and Exchange Commission is said to be gathering information on how firms and individuals are using social media. This is an evolving area and the SEC needs to determine how widespread social usage is and whether or not new rules need to be written or revised. Just remember: its’ a marketing platform and not a channel to offer investment advice. That is the first rule. Seasoned wealth managers know not to offer anything that could be construed as advice whatever the media: social or otherwise.

All advisors should refrain from making even harmless comments about the market or any comments wherever they are “speaking.” Social media should be used by advisors for social marketing and networking and not for the distribution of investment advice or comments about the market, stocks, bonds, etc. Big banks and wealth management firm’s Chief Marketing Officers know by now that LinkedIn especially, but other forms of social media, are hyper-efficient for wealth managers. It increases their ability to network more effectively and efficiently, thus gaining new referral sources and leading to new clients.

LinkedIn can be used successfully and easily in even the most restrictive of environments. A greater understanding of the upside will motivate professionals to “experiment” with LinkedIn within the firm’s guidelines. As financial advisors, you have been networking and “linking in” with sources of referrals for years. Now, “linking in” should be done digitally using LinkedIn. It is the easiest entry point for social media, like a gateway drug. Once you use LinkedIn, you will be addicted and crave more and more “serious” and addictive social media platforms….

The gateway drug theory has wide application to the world of social media. The gateway drug theory hypothesizes that recreational drugs, like marijuana, which are easier to access and less detrimental to health usually lead to harder and more serious drugs. LinkedIn is the easiest of the social media platforms on which you can become productive immediately—thus, a gateway to social media. Now, some financial services professionals believe that social media is the fodder of “geeks.” Trust me that soon we will all be maintaining multiple platforms of current/future social media all from the portable mobile device (formerly known as a phone…) Are you a “Flintstone or a Jetson?”

I am tend to be evangelistic to financial advisors and wealth managers about the power of social media. I am a pusher---encouraging financial services professionals to onboard with LinkedIn as a gateway for more “hard-core” social media. LinkedIn primes people for more and more success using social media. Since becoming a social media addict and seeing my own business grow, I have progressed to “harder” or more difficult to maintain platforms and so will you as you see the rewards of your work.

Most large firms allow advisors to have LinkedIn profiles but the following activities may be off-limits:

-participating in group discussions which may be perceived as giving investment advice

-installing applications which may interfere with your firm’s own security

-updating your own status may be perceived as disclosing a firm’s activities

-sending mass email to connections (CAN-Spam)

Here is what you can generally do via LinkedIn (check with your own compliance dept):

-Build your network of connections. And do it continuously. This means both potential clients and centers of influence. Make this part of your daily routine by adding those people you meet socially and professionally each day.

-Research prospects ahead of meeting them. Learn about employment history, associations, education, etc all of which can help you make a warmer connection to a prospect.

-Use your network for introductions and referrals. Create a marketing plan around those centers of influence in your network and request introductions to others through your network. Creating a strong referral network insures a pipeline of prospects to you.

-Join groups for marketing purposes. Compliance Officers don’t want advice being given or conversation at the group level. Connecting to groups allows you to dig down deeper to those people who you may not encounter otherwise. Joining a group allows you to view profiles and add to your network. You can customize your email messages as you learn more about a prospect. Don’t join financial services groups but think outside the box to those who may refer business to you like others in luxury goods, insurance, etc.

Cross-linking your in-person marketing efforts with online prospect intelligence will position you to attract, retain more clients and more client wallet share. Approach your in-house marketing department and get trained and ready. Engage an outside firm who specializes in UHNW/HNW marketing to consult and create a training plan. Or do what I do: ask my teenage sons.

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