The Power of Social Media: Attracting the Next Generation of Clients - BDI 9/30 Financial Services Social Business Leadership Forum - San Francisco
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The document discusses the impact of social media on attracting younger clients in the financial services industry, highlighting the shift in wealth from baby boomers to younger generations who favor social networking over traditional communication methods. It addresses the legal and compliance risks associated with social media use for financial advisors, emphasizing the need for record-keeping and adherence to advertising standards. The presentation outlines strategies for leveraging social media effectively while mitigating compliance challenges.
The Power of Social Media: Attracting the Next Generation of Clients - BDI 9/30 Financial Services Social Business Leadership Forum - San Francisco
- 1. The power of social media. Attracting the next generation of clients. Presented by: Trevor Daughney VP Marketing Actiance, Inc. @tdaughney
- 2. •Head of marketing at Actiance •7 years marketing products and services used by regulated firms •8years in marketing in energy Who am I? @tdaughney
- 3. Compliance 10 of 10 8 of 10 Top US Banks Top European Banks Key Partners 76% 2of 3 Global Wealth Managers 60,000+ Finance Professionals on Socialite 5 of 5 Top Canadian Banks Social We are the Market Leader 13M+ Social Network Connections Global Operations North American Financial Services Market Actiance Company Overview
- 5. … wealth transfer from the Boomers to their heirs is starting now and will continue over the next 30 to 40 years. Accenture, Global Private Banking and Wealth Management Survey, 2013 Wealth is shifting to younger generations. @tdaughney
- 6. Your clients are getting younger. Six in 10 advisory firms don't have any strategy in place to court younger clients. TD Ameritrade, RIA Outlook for the U.S. Economy, Industry & Markets –2014 January 2014 FOR USE WITH MERRILL LYNCH FINANICAL ADVISORS ONLY @tdaughney
- 7. 53% of people ages 18-29 say it would be very hard to give up the Internet. Only 28% said the same about landline phones. Statistics from Pew Research Center, February 2014 Young people have unplugged the landline. @tdaughney
- 8. “Just because you might get a few sales once in a while from cold calling doesn't mean that it's the best way to generate business today.” Terry Block, Social Media Marketing Keynote Speaker & Co-Author of KloutMatters The cold call has been replaced. @tdaughney
- 9. 12.5% An example: •200 InMails •158 responded •33 ask for a proposal Success rate: 1 out 6 My best with email is 1 out of 8. Normally only 1 out of 250 take an action as a result of an email! @tdaughney
- 10. Consumers are using social for instantaneous communication with family and friends. Email growth is slowing. @tdaughney
- 11. The opportunity.
- 12. Young people are on social networks. Over half of LinkedIn users are 25-44 years old. GlobalWebIndex, January 2014 @tdaughney
- 13. There are more people on social than ever before. Usage spiked 9 years ago, but now social is where people of all ages live. Pew Research Center, September 2013 @tdaughney
- 14. They’re young, smart, & wealthy. Pew Research Center, September 2013 Who are they? @tdaughney
- 15. “Companies can use social media outlets… to announce key information.” Securities & Exchange Commission, April 2, 2013 Social is the new news. @tdaughney
- 16. The Risks.
- 17. Biggest challenge? Mitigating risks that concern legal and compliance. @tdaughney
- 18. •Feature Control •Data Leakage •Incoming Threats Security •Regulations •Corporate Policies •Legal Hold Governance Enablement •Complexity •Adoption •ROI The Risks. Anthony Fields fined $150K by the SEC for making fraudulent offers on social media @tdaughney
- 19. Compliance Overview For Social Media for Financial Advisors Record keeping Preserve records of written business communications for specific time periods. (If you write it out, it’s “written”.) LinkedIn -Updates, InMail; Twitter -Tweets, Direct Messages; Facebook –Posts, Messages. Regulators only are interested in business communications. Includes Third Party content. Includes personal devices, as content, not source, is determinative Work with third party to capture, archive and make e-discoverable all written communications. Regulation Definition Recommendation @tdaughney
- 20. Testimonials Testimonials with “material Connection” are prohibited for Investment Advisors (IAs) and need to be qualified for Registered Representatives (RRs). Recent SEC guidance. Many firms prohibit “Recommendations” and “Skills” on LinkedIn, “Retweets” on Twitter and “Likes” on Facebook to avoid the appearance of an endorsement. Suitability “Know Your Customer”. Recommendations must be suitable for every investor. Most firms prohibit product recommendations and investment strategies unless preapproved by a registered principle of the firm. Regulation Definition Recommendation Compliance Overview For Social Media for Financial Advisors @tdaughney
- 21. Advertising Content standards are the same as other communications. Firms are also responsible for both suitability and recordkeeping of third party content (links, posts). Most firms prohibit retweets, favorites and likes to avoid appearance of “adoption and entanglement”. Static content, such as a LinkedIn Profile that contains more than business card information, is an advertisement and requires pre-approval. Interactive communications do not require pre- approval. LinkedIn, Facebook and Twitter have both. Supervision, recordkeeping apply. Regulation Social Network and Recommendations Definition Recommendation Compliance Overview For Social Media for Financial Advisors @tdaughney
- 22. Supervision Firms must evidence that they are super- vising communications. Use similar written supervisory procedures already in place. Employ risk-and principle- based principalsfor review. Limit access to social media unless supervised. Pre-approval of content is required in certain cases. Appropriate training is required. New FINRA Rule 3110(b)(4) includes supervision of internal communications to comply with FINRA and MSRB rules. Regulation Social Network and Recommendations Definition Recommendation Compliance Overview For Social Media for Financial Advisors @tdaughney
- 23. You can jump over these hurdles. @tdaughney
- 24. The result.
- 25. Use LinkedIn throughout their day to help make themselves more productive, more relevant, more effective. A day in the life of a busy financial advisor. @tdaughney
- 26. 28% 16% 18% Software Info Tech Others 41% 11% 29% SF/Bay Area New York Toronto 58% 42% Executives Others They build credibility by mining their network and asking for introductions, and listening for “money in motion” events that represent opportunities. Industry Location Job Title They will be connected. @tdaughney
- 27. At a marathon, a supporter, became a client. Use LinkedIn to close more deals. @tdaughney
- 28. Thank you! @tdaughney Trevor Daughney, VP Marketing [email protected]