Taking the Social Plunge

Richard Nolan

Operations Director

The Financial Services Forum

For IFAs, social media offers huge opportunities as part of an integrated content marketing strategy, as Paul Wreford-Brown explains
For the printed version of this article, please download the PDF.
In a post-RDR world, social media should be throwing a lifeline to IFAs at this most difficult of times. It gives them an opportunity to generate interest in their brands and demonstrate integrity against a backdrop of declining consumer confidence and a huge range of alternative options. It also offers the chance to directly address the perception that they are not demonstrating value.
Yet, as with other areas within financial services, IFAs have so far been reluctant to dip their toes in the social media waters.
There are, of course, various reasons for this reticence, with the beast that is compliance at the top of the list.
Elena Todorova, Cert PFS Cert CII(MP), Executive Consultant at John Charcol, explains: ‘Our industry is very closely regulated, so we have to be very careful about what we write. There is a thin line between supplying information and advising. If you write a major opinion piece, you have to supply a caveat to say it is an opinion piece. This means IFAs aren’t clear how far they can go.
‘I don’t provide advice on Twitter, for instance, people have to contact me directly – but I do share general information and articles I find interesting.’
Recent FCA guidelines have done little to clarify the situation. Advice that posts should be fair, clear and not misleading; use of the hashtag #ad for promotions and a statement that there must be a distinction between business and personal communications, have been met with a resounding cry for more guidance.
The fear factor for organisations in this area can be significant – particularly for IFAs in large networks where directives come from the top.
What’s more, social media is regarded as a young person’s game – as a demographic, IFAs tend towards being mid-40s plus – but this is as much about technology adoption as it is about finding the time to explore and come up with what is required.
However, if you scratch beneath the surface, there are IFAs leveraging this medium to their benefit.
This year, financial services marketing agency Embrace conducted a piece of market research which looked at how IFAs and investors were making sense of social media and how it was shaping their decisions about investments.
The agency spoke to 205 intermediaries: 60% managing over £10m, 40% managing higher value clients and 70% under 54-years-old.
The results revealed that both advisers and investors are using social media and, as younger audiences mature, the medium will become increasingly important. Additionally, the advisers using social media are very engaged.
As you drill down through the research, the figures get really interesting.
IFAs are using social media for multiple purposes: 47% to raise their profile, 50% to keep up with the industry and markets; 68% to communicate with colleagues and peers and 42% to communicate with clients and prospects.
The advisers who are using social media are using it regularly – 82% claim to be interacting online at least once a week and 24% of all advisers claim to have gained new clients where the initial contact was made in this way.
One of the most startling findings was that Facebook was of value in this space. This is a fact that Martin Bamford, CFPCM FPFS and Managing Director of Informed Choice, Chartered Financial Planners agrees with.
He explains: ‘For our business, Facebook is wholly social, we have a corporate page, but we keep it light and share details about what we’re doing, such as events. We’ve not used it to go out and look for clients, but we’ve used it to make it known what we do.’
Twenty percent of intermediaries quizzed said that social media is quite or extremely important to their businesses.
The successful social IFAs are generally sole practitioners or it’s one adviser within the firm who has taken control.
Martin Bamford explains: ‘I was shortlisted for the Unbiased Social Media award with Matthew Walne (Santorini Financial Planning), Chris Daems (Principal Financial Solutions) and Alistair Cunningham (Wingate Financial Planning). There are not many IFAs doing it well but I think we’re successful because we’re hungrier.
‘We’re not actively looking for new clients but we’re getting referrals using social media and looking to grow our route to market. What makes us different is probably nothing more than a willingness to give it a go.’
There is, however, some confusion as to what ‘social media’ in this sector actually means. Inevitably, most things digital are included in this sphere – from websites, to email, to ‘accepted’ social platforms like Facebook, Twitter, YouTube and LinkedIn; to support tools like social media dashboard Tweetdeck; Hootsuite to schedule content; and Nurph, a platform to facilitate question and answer sessions.
However, perhaps surprisingly, Apps are yet to find any currency except as a tool to facilitate the above digital interactions and manage communications.
It is important to realise that social media is part of a branding process – a collection of messages to direct attention back to your website and your central offering.
Significantly, it’s important to express a point of difference through messaging and content, though this has to be countered with the fact that it’s not just about selling.
Martin adds: ‘About 5% of our business came through social five years ago, but now it’s more like 30%.
‘There’s no formula, clients come through various routes, but the one thing they will do is check out the website before they pick up the phone. And we know that they’ve looked at our website, because they always mention the office dog, who has his own profile on the site.
‘People are interested in those things – they give you a point of difference and make people realise you’re like them. At the end of the day, people buy into people.’

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