Wednesday 25 April 2018

Financial Advisors Can Build Trust, One Tweet at a Time

As we recount the economic paralysis that ensued five years ago this fall, the financial services industry continues to absorb reputational damage stemming from the crisis and its subsequent scandals. The bumps and bruises remain particularly visible for the financial advisory sector — a field highly dependent on confidence and relationships. Just look to our 2013 Edelman Trust Barometer, which indicates that only 32 percent of respondents in developed markets trust advisors.

The key takeaway for investment services firms and their advisors is clear: closing trust deficits must remain a top business goal. This is an area where a social media strategy can add tremendous value, especially when it comes to deepening existing ties and reaching new clientele.

“When it comes to enhancing reputational currency and rebuilding trust, financial institutions should be creative and diligent,” says Mory Fontanez, Executive Vice President with Edelman Digital in Washington, DC. “A FINRA-compliant social strategy can really help humanize investment firms by positioning advisors as true brand ambassadors.”

Social media enables advisors to build relationships through compliant content sharing, commentary on market topics and the monitoring of client needs. These types of actions can also have a positive secondary impact on brand loyalty and overall corporate reputation. As a result, many firms and individual advisors are already active on Twitter, LinkedIn and Google+.

So what are the foundational components of a successful social media strategy for investment firms and advisors? We see three top-level elements:

1. Governance

FINRA compliance and training should form the basis of any advisor engagement initiative. This means developing and socializing social media usage guidelines, content standards and an approvals structure. Advisors and community managers should know the appropriate channels for engagement, understand content guardrails and be closely aligned with a reviewer. In addition, a central body should be responsible for archiving and monitoring social shares; this can be supported by technologies as well.

2. Process

Once sound governance is established, the next step is developing an editorial and content flow. Within a moderate to large firm, advisors and community managers should receive some pre-approved editorial material and sharable content from a central governing body; this should be informed by insights from communications, marketing and core departments. Pre-approved content formats should span short-form text, blog posts, photos, infographics and videos. When appropriate, advisors should also be empowered to add their own voice to content and share informal updates. Remember, even in the regulated financial space, content is king!

3. Execution

The final step is applying both governance and process to actual execution. Advisors can begin by activating on the appropriate social channels; Twitter and LinkedIn are ideal places to start. Profiles should call out accreditations, such as Certified Financial Advisor (CFA), in order to comply with regulatory provisions and organizational standards. This positions advisors to begin engaging with clients, sharing timely content and establishing a thought-leadership voice that positions them to attract new clientele. A measurement framework can be simultaneously implemented to evaluate social media’s impact on advisors’ existing relationships and business development efforts.

Positioning financial advisors to engage on social media will be a big step for some conservative, established financial institutions. However, institutions looking to build trust may find their success is tied to standing out rather than fitting in. Would you open an accredited advisor’s direct message if it appeared in your inbox on LinkedIn or Twitter?

Image credit: n_erd

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