6 ways to manage an effective social networking strategy
by Amy E. Buttell
It's the Wild West out there-as if Facebook, LinkedIn and Twitter weren't enough, now there are YouTube channels, Foursquare and Google Buzz. You need to connect with your audience and potential client base where they live, so if you're not on the Internet and at least thinking about doing something with social networking, you'll likely be left in the dust.
That being said, compliance and the sheer amount of time and energy it takes to establish and maintain a social media presence are significant barriers to entry. Regulators seem to be more than a step behind innovation in this space, and many planners who are ready to jump into social media with both feet are being held back by nervous compliance departments. Even if compliance is not an issue, social networking can devour your entire day if you let it. What to do?
The key to successfully taming the social networking beast is devising a strategy that works for you and satisfies your compliance department and regulators. Whether you're new to social networking or are doing it right now, the media are rapidly evolving. What works for you today may not work tomorrow, but as long as you're engaged and figuring out how social networking fits into your overall marketing plan, you're in good shape.
"All financial advisers should have a social media or personal brand-building plan and budget-time, money, goals and a clear understanding of what they want their image to be online and in the real world," says Bill Corbett Jr., a public relations and social media marketing consultant with Corbett Public Relations Inc. in Floral Park, N.Y. "Social media success in business does not come overnight. It is an investment, and planners will get more out of it if they spend more time on it, but time must be allocated and actions done consistently and efficiently."
And don't think it's OK to stay out of the social networking space if your client base is retired or about to retire. The demographic that is coming online the fastest are people ages 40 to 60, according to Trish Lawrence, a social media expert who works with authors and professionals to increase their social networking presence.
"Statistics show that the fastest-growing population on Facebook and Twitter is not teenagers-they mainly text," says Lawrence.
Jamie Cox, managing partner of Harris Financial Group in Colonial Heights, Va., agrees, saying, "Many of my clients are grandparents who are on Facebook to connect with their grandchildren."
Here are six issues to consider as your social networking strategy evolves:
You Can't Win If You Don't Play
The major strength of social networking is that it is a relationship-building tool, and for planners, that's key to building their businesses.
"You have to show your clients that you care, which is what social media is all about," says Lawrence.
You can't do any of this if you're not engaged. Obviously, the first step-if you're not online-is to get a Web site. For many planners, the next step is a blog. Consider free resources such as www.blogger.com and www.wordpress.com. Once you have a blog, you've got content to push out to social networking platforms including Facebook, LinkedIn and Twitter. Even if you don't have a blog, you still need to experiment with social networking to understand what it is and what it can do for you.
"If you're new to social networking, I would say set up a personal Facebook page first," says Cox. "Reconnect with your friends. Learn the power of it first, because you're not going to be sold on starting up a business page if you don't use it first. Make all the mistakes of posting stupid stuff on your personal page where you can get by with it."
Lawrence agrees that starting small makes sense and recommends that you try to do 10 percent of what you think you should be doing and move up from there.
Manage Your Time
Once you've embraced social networking, it can become a giant time suck.
"You have to be reasonable about the amount of posting you want to do, whether it's on a blog, LinkedIn, Twitter or Facebook, and not feel like you have to tweet five or six times a day and do a blog entry every day," says Lea Ann Knight, CFP®, principal at Garrison/Knight Financial Planning LLC in Bedford, Mass. "It has to be manageable, or you'll stop doing it. You'll be miserable."
John Chladek, CFP®, principal of Chladek Wealth Management in Overland Park, Kan., got involved in social networking when he started his own firm in November.
"I read so much about it and saw that it is basically free marketing," says Chladek. "To get started it's pretty time consuming, but after that I spend maybe an hour a day tops maintaining what I've got. I've been blogging once a week and post to my Facebook page and also use LinkedIn. The one program I'm struggling with is Twitter."
Some advisers are comfortable with all social media; others focus in one or two areas. For Knight, Twitter is working out well for her, but she hasn't quite gotten into Facebook for business, while it's just the opposite for Chladek. Whatever social media you decide to use, you can save time by using tools like www.hootsuite.com or www.tweetdeck.com, applications that let you manage Twitter, LinkedIn and Facebook simultaneously.
Promote, Don't Over-Promote
A major danger with social networking is when you view it as only a promotional or sales tool, rather than a relationship-building tool.
"Never try to sell anything directly via social media and be careful promoting events," says Corbett, the PR professional. "If they are self-serving or sales events, it will hurt your reputation."
Resist the temptation to continually post promotional updates on Twitter, Facebook and LinkedIn. Instead, mix those up with information that your clients, friends and connections might find useful and some personal information. A ratio of one promotional post (a link to your most recent blog post or a recent appearance on TV, for example) to every five or six overall posts is about right.
Establish Boundaries
Some planners keep their personal and professional social networking lives completely separate. They don't friend their clients, instead directing them to a business fan page on Facebook or inviting them to become a follower on Twitter. They don't push their posts about their personal lives out to LinkedIn and other online places where their clients might see them, because they don't necessarily want their clients to know that they play Mafia Wars six times a day or read about the details of the latest antics of their toddler.
But for other planners, the personal stuff is an important part of building a relationship with their clients. Cox has two personal Facebook pages, one for his friends and one for his clients so he can keep up with what's going on in their lives. His firm also has a Facebook fan page.
Consider Advertising
Scott Cole, CFP®, principal of Cole Financial Planning in Bessemer, Ala., uses Facebook advertising to connect with potential clients.
"The Facebook ads have definitely generated traffic on my site, but I can't tell if they've resulted in new clients or not, but I am hopeful that they will," he says. "The Facebook ad thing is easy and relatively efficient because you can hone in on exactly the market you want to target."
Cox agrees, noting he has been able to specifically target retirees and those about to retiree from telephone, power and other utility companies through buying Facebook ads, which cost about a penny a click.
Weigh Compliance Issues
Before you launch a social networking strategy, check with your compliance department or a compliance expert.
"Some organizations are looser on compliance than others," says Corbett. "One planner I am working with is limited to LinkedIn; he cannot use Facebook or Twitter. All the materials he creates need to be reviewed by compliance and this can take several days. It's difficult to remain topical and relevant to the day's issues if one has to wait to respond."
The Financial Industry Regulatory Authority (www.FINRA.org) has issued guidance about social networking with a recent regulatory notice. Regulatory guidance and compliance are evolving issues, but according to Cox, one way to help speed compliance reviews is to develop some standard templates for language about particular issues, such as appearances on television shows.
Amy E. Buttell is a freelance writer and regulator contributor to Practice Management Solutions. After researching this article, she is now hooked on social media. Find her on Twitter and LinkedIn.
Learn More
Learn about managing multiple social media profiles, monitoring Web site traffic and tips for social media in compliance in the May issue of the Journal of Financial Planning, where technology and financial planning expert Bill Winterberg, CFP®, writes about these and other social media topics. Also, look for more information on social media compliance in the June issue of the Journal.
Follow the FPA publications team on Twitter at www.Twitter.com/FPApubs and read the Practice Management Center Blog, including technology and compliance tips for social media, at PracticeManagementBlog.FPAnet.org.
