If you are in the financial industry and are not able to leverage social networks, like LinkedIn, for recruiting you are put at a distinct disadvantage. The competition for great talent goes on as companies as doing more with less so finding a way to reach your next great producer is more valuable than ever.

Getting access to social networks is just the beginning. This story also illustrates how companies can get from social networking tools if they activate their entire employee base. For recruiting – as well as for client acquisition and retention – increasing your reach by tapping the collective networks of your employees helps exponentially grow your enterprise social graph.

For example, many recruiters use LinkedIn extensively to find candidates for open positions. They search for specific job titles, by geography, or for types of industries, which gives them a list of potential candidates. After narrowing this list down, they then look for possible connections they may have with these candidates.

If you’re not familiar with LinkedIn, users must request “connections” with other users, creating a direct connection. Once a recruiter finds a prospective candidate on LinkedIn, she can see if they have any connections in common – called second-degree connections.

With this in mind, it’s easy to see how having more employees connected within your organization can exponentially increase these second-degree connections. If a candidate is linked to someone at the recruiter’s company, the recruiter can get first-hand information about the candidate, then ask to be introduced or connected to the potential candidate.

And it doesn’t end there. Once a candidate submits his or her resume, the recruiter can cross-reference the resume with their LinkedIn profile and find other connections they share to get more information about the candidate. In addition, your employees connected to the candidate can help “sell” them on the idea of moving to your firm.

In short, the more connected your employees are, the more connections your firm has beyond its four walls. And this will impact the growth of your firm – measured by clients as well as recruits.

Social media has so much to offer the financial services industry yet education, awareness and questions are holding it back. Our hope is that by bringing together industry experts, passionate users and those standing on the sidelines that we will be able to accelerate the adoption of social media.

To help foster and grow the community we’ve created the SocialTurns Council. The Council is made up of compliance, marketing, technology and financial services professionals who are pioneering social media adoption in the financial services industry. Please join me in thanking all of our Council members:

• Pat Allen, Principal, Rock The Boat Marketing
• Debbi Corej, VP of Compliance, Prudential
• Julie Gebert, AVP of Compliance, Cambridge
• Kip Gregory, Principal, The Gregory Group
• Bruce Johnston, President & CEO, Advisolicity
• Kristen Luke, Principal, Wealth Management Marketing
• Christina L. Nelson, Senior Editor, Financial Planning Association
• Stephanie Sammons, CEO, WiredAdvisor
• Stephen Selby, Director of Regulatory Services, LIMRA
• Jennifer Sussman, Director of Online Marketing and Experience, American Century Investments
• Pete Chiccino, EVP and CIO, The Bancorp Bank

In the last few weeks we’ve invited users to sign-up for the preview and the reaction has been tremendous. To date we’ve had almost 500 users join SocialTurns from 13 different countries and the discussions are off and running ranging from enterprise social media adoption, to FourSquare, to employee guidelines.

We invite marketing, technology, compliance and financial services professionals to join the conversation. As you navigate the social media waters this community is here to help you make the right turns to get the most out of social media for your brand, your employees and your customers.

And don’t forget to let us know what you think or how we can improve. Here is one review from David Rosen at The B2B Formula.

See you on SocialTurns.

PS: After you join please add a badge to your website, blog or Twitter profile to help grow the awareness of SocialTurns and help fuel the discussion.

So what keeps organizations up at night, in light of all these changes? According to 2010 Forrester research, data leakage and ensuring regulatory compliance in using these platforms are among the top concerns of organizations.

Data leakage is the biggest concern, with 82% of large organizations reporting themselves as “very concerned” or “concerned.” In the transparent social web, organizations – especially those with more than 5,000 employees, which is where this research is focused – have cause for concern. Regulatory compliance is another big concern – 66% of those surveyed said they were concerned or very concerned about maintaining compliance while enabling these social sites.

To address these fears, many large organizations restrict access to these and other “non-essential” programs, with almost 60% of enterprises reporting such restrictions. However, as we’ve talked about in the past, prohibition is not the answer.

Smarter companies are creating guidelines and implementing finer-grained controls on a feature-by-feature basis. This gives employees the opportunity to use key social networking capabilities while still giving the enterprise a degree of control. Up to 86% of enterprises have or plan to have such access in place which would allow advisors to, for example, establish a Twitter account or leverage LinkedIn to the fullest, all in a compliant fashion.

This aligns with our philosophy of enabling users to make the most of social networks for business, rather than blocking them. Innovative organizations seek to understand how social networks are used or can be used to build personal and professional networks, then analyze potential risks. The next step? Develop a policy that works by addressing regulatory issues, educating users on the policies, then enable them to use the social networks in appropriate ways. Over time, firms will review actual usage and results, policies will be updated and new ways to make the most of these networks will be discovered.

In short, while enterprises – including financial institutions – have cause for concern, ignoring the power of social networks isn’t the answer. There are many ways social networks will impact business – including creating new referral sources, helping advisors keep in touch with customers and recruiting new talent.

The companies that “get to yes” first will create a competitive advantage, establish themselves as innovators in the industry and enjoy the financial rewards this new communication channel has to offer.

Ask for referrals. All firms preach this, but the survey of wealthy investors found that 75% of them haven’t been asked to refer their colleagues to their advisor. In the era of LinkedIn and Facebook this is the low hanging fruit that everyone should be reaching for. Consider too that nearly 60% of LinkedIn users have high personal incomes and hold executive-level or consultant positions. If you aren’t building your networks online and leveraging those relationships you are leaving money on the table.

Actively keep in touch. Only 38% of investors say their advisors proactively reach out to them when market changes could impact their portfolios – and it’s hurting client retention. One third of investors have changed advisors since 2008, and 25% of the rest of wealthy advisors are dissatisfied with or neutral towards their current advisor. Again social networks can help. Look at the advisors on AdvisorTweets.com. Over 400 advisors are tweeting to clients and prospects about the market. If you aren’t tweeting, who are your clients following? Or even worse who WILL THEY be following?

Stop shouting, start engaging. We used to think about marketing as a chest-thumping activity that ensured we were always top of mind with prospects. Guess what. The old way doesn’t work anymore. Marketing today is about active engagement. Social networks are a key part of this change, allowing you to come out from behind the megaphone.

Think your clients aren’t using social networks? Think again. Another recent post revealed research showing those who use social networks are very interested in hearing from advisors: 63% of Twitter users would pay attention to investment tweets; 46% of YouTube users and 41% of Facebook users would seek investment information from these communities.

The question you should ask yourself right now is this: If you’re not engaging with your clients and prospects, who is?

Social Media in the Mutual Fund Industry
Tuesday, August 3^rd at 1PM EST Unified Fund Services is hosting a webinar on the use of social media in the mutual fund industry. Mutual fund managers and financial advisors will learn the best ways to use social media in their businesses, along with updates on recent regulatory changes and new technologies that make social media communications easier to manage. Speakers include: Jeff Young, Unified Fund Services (Huntington Asset Services), Bruce Johnston, Advisolocity, Ellen Bruno, Compliance Advisor Professionals and Oat Ruchira, Unified Financial Securities.

“Although a significant number of financial services professionals use social media professionally, many are not effectively using these tools to grow their businesses,” said Brian Blomquist, president, Unified Fund Services (Huntington Asset Services). “Our web seminar will help participants learn how to make the most of this growing opportunity while remaining compliant with industry regulations.”

Register here.

Best Practices: Driving Business on Facebook
Tuesday, August 3^rd at 2PM EST Socialware will be joined by Stephanie Sammons, CEO of WiredAdvisor, for a webinar titled Best Practices: Driving Business on Facebook. This webinar examines best practices for driving business and connecting with customers using Facebook, keeping in mind the compliance challenges associated with using this site. Learn innovative strategies to Re-Connect, Discover Insights, Distinguish yourself, and Make Fans & Friends through Facebook. Ultimately driving new business and deeper relationships with your customers.

Register here (and if you can’t make it live just check back to watch the recorded version and to also download the slides).

Success Stories: How Advisors are Using Social Media for Business
Thursday, August 5^th at 12PM EST Socialware is moderating a roundtable discussion on how advisors are successfully using social media today to drive their business. We will be joined by Paul Hrabel of One Fund and Curtis Smith of Interactive Capital Management. This interactive roundtable will discuss the use of social media by advisors, how this integrates to an overall marketing strategy, success stories and strategies, embracing social in a compliant fashion and finally tips on how you can sell your firm on opening up access.

Register here (and if you can’t make it live just check back to watch the recorded version and to also download the slides).

And as always if you’ve missed any of our previous webinars be sure to check out the Socialware Insights webinar page.

Syncapse came up with the figure by asking 4,000 fans of 20 of the top brands on Facebook — including Nokia, BlackBerry, Nike, Coca-Cola and Starbucks — why they were fans of those companies or brands, and about their past and future purchasing behavior. Syncapse then estimated what the value of each fan’s spending would be to a company, as well as the value of continuing to have that fan as a customer over time.

Obviously, this is a small sample size, and investment firms can easily argue that this type of data relates only marginally to financial services. Large investment firms may not have coupons, specials, or fun contests to promote via Facebook. However, for building a presence as a brand or an individual agent, keeping your name top of mind, regularly communicating about your own practice, and staying connected in such an easy way with people who have chosen to be your fan can be quite a valuable endeavor, indeed.

According to Syncapse, “A fan base is a self-segmented group of highly valuable customers.” The “self-segmented” part of the equation can’t be overstated – they have opted to hear from you. They are more likely to think of you – and recommend you – to their circle of influence. Consider these findings:

• Fans are 28% more likely than non-fans to continue using the brand.
• Fans are 41% more likely than non-fans to recommend a fanned product to their friends.

Syncapse has observed that an average fan may participate with a brand ten times a year and will make one recommendation; however, an active fan may participate thirty times and make ten recommendations. As a financial firm – and especially as an individual advisory or agent – these 10 or 30 interactions can have a dramatic impact on referring new business and retaining clients.

In fact, this research indicated that Facebook fans were more loyal to the fanned brand than consumers who were not fans. On average, Facebook fans are 28% more likely to continue using a brand than are non-fan consumers. This data illustrates the importance of the audience on short-term and long-term marketing efforts of an organization. In short, not only should a firm and an advisor work to gain fans – it’s also important to keep in contact with this audience.

As any advisor knows, word-of-mouth makes a huge impact on building a practice. While you attend networking events and sponsor local events to meet people in your area, Facebook can be a natural way to help your clients easily spread the word to their friends. Those who have specifically chosen to be your fan are 41% more likely than non-fans to recommend you to their social network.

So how should this data impact your daily life? First, it’s critical – and expected – that reputable firms and advisors have a social media presence. Once you set up your Facebook page, spread the word – encourage your own circle of influence, the ones who know and trust you most, to become your Facebook fan (done by “Liking” your page).

But – even more importantly – give them real value in being your fan. Of course, you can’t recommend hot stocks – but you can point to articles that have direct interest to your clients and prospects, or share blog posts, or ask questions that encourage discussion on your Facebook page – all within the parameters of corporate and regulatory guidelines.

While you may not be selling Coca-Cola, don’t underestimate the value of your online participation in social networks, and keep giving others reasons to pay attention to what you have to say.

Together we will work to help the industry take full advantage of social media in a compliant and effective fashion. As part of this effort we’ve partnered to expand the Socialware Insights program, an information service to provide ongoing support and up-to-date research to financial services professionals using social networking sites. LIMRA and Socialware will expand this offering to be focused entirely within the financial services industry, customizing the content to the functional needs of the various positions.

Our first joint effort centers on the development of a Social Media Adoption Life Cycle for financial services firms. We will introduce this new framework later this week during a live webcast. Stephen Selby, Director of LIMRA Regulatory Services will join us on Thursday, July 22^nd at 11am CST to discuss the framework, the specific characteristics of each stage and key tips on how to move forward on adopting social media in a compliant fashion.

In addition, LIMRA is hosting a Social Media For Financial Services seminar on Aug. 26-27, 2010. This seminar will help firms develop and implement cohesive strategies that leverage the power of social media while meeting regulatory requirements. It will cover a wide range of issues and feature best practices presentations from industry experts and thought leaders. Register now as space is limited. We look forward to seeing you there.

While LinkedIn is still the preferred social network for business use, Facebook is gaining steam. In our 2010 Advisor Survey we found that 24% of respondents currently use Facebook for business use and this number is expected to grow to 43% by the end of the year. Consider that Facebook is currently banned by 38% of the respondent’s companies and you can see that there is still tremendous room for growth.

But before that growth can come to fruition firms need to address the compliance challenges posed by Facebook. Should agents be able to use Facebook Chat? Should they “like” comments made by other users? Can they actively participate in Facebook Groups? What about Facebook Mail? The fact is there are over 30 different features that compliance officers need to consider before opening up access.

To help firms accelerate their adoption of Facebook we just released our Guide to Facebook Social Networking Compliance. We analyzed every feature, explaining each in detail, associated it with a content type, classified it according to the FINRA/SEC guidelines (based on Notice 10-06), offered a set of compliance considerations, and provided a specific recommendation to help jumpstart the creation of your social networking policy and plan. Download your free copy today.

And finally, don’t forget to register for our upcoming webinar on Facebook Business Best Practices.

Powered by Socialware’s Compass solution, the new integrated offering combines our unique abilities around social media archiving, pre-review, feature-level policy automation and social media analytics with AdvsiorMail so firms can take advantage of the opportunity social media presents, in a compliant fashion.

As we’ve discussed before, the compliance questions around social media continue to grow. Should you open access? If you do, how do you supervise the content? How can you ensure reps and employees follow your policy? The list goes on and on. The fact is, every social media site poses its own unique challenges and considerations. To help firms get clarity in this area, we’ve published numerous guides and webinars which can all be accessed through Socialware Insights.

By combining Compass, AdvisorMail and our ongoing commitment to provide expertise from both a compliance and best practice standpoint, firms can now adopt social media confidently, quickly and on their terms – critical to managing the compliance issues that face this industry.

To learn more about this integrated offering please contact your LiveOffice representative.

At this point you are probably as shocked as I was. You may also be scratching your head as to how 1,700 people could like his update. What happens on LinkedIn is that when someone in your network “likes” a comment or status update it is automatically shared with that person’s network – instantly multiplying the reach each message has.

For employees who are looking to build their personal networks and for companies looking to build their brand within their business communities, this simple experiment shows how quickly a compelling message can spread throughout a network.  Unlike Facebook updates, where you need to be directly connected to someone, the majority of commenters and fans of Joss’ update have never met Joss face to face.

As a follow up message, Blair posted “Blair Joss is hunting for a professional in the oil and gas industry with experience in Reservoir Engineering and has a network in Norway.”  LinkedIn has clearly given him a platform to meet prospects, colleagues, and customers who may have never been connected to him otherwise, but given that he has a great message and a network that can spread it, he has truly taken advantage of the tools available to him.  How are you helping your employees spread their message?