LinkedIn and Socialware are working together to ensure that financial professionals have the knowledge and tools they need to get the most out of LinkedIn as an effective business platform. Now we’ve partnered with Ajax Social Media, a firm that specializes in improving LinkedIn profiles, to bring you a series of four how-to webinars to help you get the most out of LinkedIn.

Maximizing LinkedIn Use as a Financial Professional

LinkedIn is the world’s largest professional social network and a natural fit for relationship-driven industries such as financial services. But many people just don’t know where to start. In these four webinars, which will air February 7-10, 2012, experts from LinkedIn, Ajax, and Socialware will share best practices and step-by-step training for building valuable relationships and realizing the full benefit of the LinkedIn community.

• Step 1 — How to Optimize Your Profile (February 7th) — This discussion will cover the necessary ingredients for presenting yourself and your unique value proposition effectively in your profile.
• Step 2 — How to Build Connections (February 8th) — This webinar will focus on how to build quality connections that correspond to your target audience and what tools are available within LinkedIn to find them.
• Step 3 — How to Listen and Engage (February 9th) — In this discussion, we will demonstrate how to listen to what your connections are saying and how to identify money-in-motion events such as job changes.
• Step 4 — How to Post and Share Your Voice (February 10th) — This session will focus on how to share content and post comments that demonstrate not only your professional core competencies but also your own personality.

Each of these highly practical sessions will address compliance considerations and real-life user examples. Most importantly, they will give you action items you can pursue immediately to make LinkedIn an important part of your professional success.

We’ll air one webinar each day at 11 a.m. Central time. Please register to attend all four webinars as they are separate events.

Click here to register for all four webinars.

(This is a guest post from Stephen Selby, Director of Regulatory Services at LIMRA.)

As social media users in financial services have discovered over the past couple of years, it’s tough to build a business in a swamp. It makes me think of the King of Swamp Castle from Monty Python and the Holy Grail.

Listen, lad. I’ve built this kingdom up from nothing. When I started here, all there was was swamp. All the kings said I was daft to build a castle in a swamp, but I built it all the same, just to show ‘em. It sank into the swamp. So, I built a second one. That sank into the swamp. So I built a third one. That burned down, fell over, then sank into the swamp. But the fourth one stayed up. An’ that’s what your gonna get, lad—the strongest castle in these islands.

Social media regulation has been a little like Swamp Castle. FINRA released Regulatory Notice 10-06, and built a foundational concept for all of us to follow—all the old rules apply. But the financial services industry as a whole did not believe that foundation was solid enough. We let the first castle sink into the swamp.

Then FINRA released Regulatory Notice 11-39. The financial services industry again said that foundation was not strong enough, so we again let social media fall into the swamp. Foreign regulators like the FSA in Great Britain and the IIROC in Canada published social media guidance in their own countries. The National Association of Insurance Commissioners issued its own white paper on social media. The messages from the FSA, IIROC, and NAIC all tracked well with FINRA’s core message—all the old rules apply. But the financial services industry was not happy with that foundation yet and, even with all of the positives, watched social media again fall into the swamp.

January 2012: The Fourth Castle of Social Media Regulation

Now we have both the SEC and the Commonwealth of Massachusetts issuing guidance for Registered Investment Advisors. To paraphrase the King of Swamp Castle—I am here to tell you what you’ve gotten—the strongest castle in these islands! We have seen securities regulators, insurance regulators, and now RIA regulators all say the same things: Yes, social media is an exciting new form of communication. Yes, we will apply existing rules to this new technology. It should be clear that we are no longer standing in a swamp, but on the strong foundation of a consistent message.

Let’s see how that consistent message applies to RIAs in the Commonwealth of Massachusetts. I will present these points in a different order than communicated by the Massachusetts Securities Division their memo of January 18, 2012. This order should help you structure your approach to social media for RIAs:

• Social Media is subject to supervision. Have a plan. Document it. Test the plan at least annually.
• Training. No policy or procedure is very good unless people know what it is. Therefore training is a really good idea.
• The firm is responsible for all business content. It’s social media time. Do you know what your investment advisor representatives (IARs) are saying?
• Social media is subject to record-keeping requirements. You will need a method of capturing and retaining social media content in a manner consistent with SEC retention rules. (For more, see 950 CMR 12.205(7)(a) and 17 CFR 275.204-2.)
• Frequent supervision is better. Massachusetts states on page 6 of their document “A review done daily would be considered a reasonable supervision of the adviser’s social media site.” Less frequent review can be acceptable—if you have low traffic volumes.
• Social media is usually advertising under RIA rules. Go back to the basics and apply current advertising content and supervision standards for RIAs to social media. Performance reporting via social media is subject to the same content and time standards as any other kind of media. Cherry picking past performance is not permitted. Recommendations are not permitted.
• Adoption and Entanglement applied across regulators. RIAs are responsible for content which they post, Tweet, re-Tweet, or like, or to which they link. RIAs are also responsible for content which is posted on behalf of their representatives by business partners or anyone else who has an interest in the success of the IAR. Selective removal of some content results in the “adoption” of the remaining content.
• “Liking” can be Problematic. To completely understand what Massachusetts is saying about the “Like” button, I encourage you to read SEC Regulation FD and the recent SEC risk alert. The key take-away is that your firm is responsible for any content which is “Liked” by the firm or an IAR. Make sure it’s good content.
• Read the SEC guidance. Massachusetts makes reference to recent SEC guidance on social media usage.

More Best Practices for Social Media Compliance

The Massachusetts document “The Use of Social Media by Investment Advisers” is not intended to tell the whole story. Here are a few ideas you need to consider beyond the recent guidance provided by the Commonwealth.

• Put clear license and registration disclosures in social media profiles. This will help insulate the firm against the appearance of soliciting where the firm is not registered.
• Update the firm’s Code of Ethics. Not all states require a code of ethics, but communicating a standard and then training your people to that standard is always a good idea.
• Face-to-face supervision is a best practice. Take time to review the computers and mobile devices of IARs when visiting satellite offices.
• Understand what is being said about you by solicitors and other business partners. You may need to review agreements to specifically address the use of social media.
• Get help, but take responsibility. Social media use and supervision is ultimately up to you, but Socialware and LIMRA can help get you going.

In closing, think of the King of Swamp castle. “All the other kings” may say you are daft for using social media when there are so many questions, from ROI to compliance. Prove them wrong. Now that regulators for the securities, insurance, and investment advisory business have spoken, you have a firm compliance foundation on which to build your social media practice.

When so many regulators are saying the same thing—maybe you really do have the opportunity to build the strongest castle in these islands.

Image source.

Drive for Results

interviewed me for my thoughts on his findings a couple of months back and I shared with him much of what you will see below. The title of the study states that “The Bloom is Off the Rose” meaning that advisors are discovering that there is not as much value as proponents of social media claim. While that title is provocative the subtitle “Most Have Unrealistic Expectations Or Fail To Use It Correctly“ gets to the root of the challenge.

Here is my take on how advisors and financial firms should interpret the results of the survey.

My first question to the author was, “are these the same advisors?”

The advisor sample used in 2011 is similar but not the same as that used in 2009. The headline in the RIABiz article seems to indicate that the advisors who were originally surveyed back in 2009 are the same advisors responding to the 2011 survey. This is not the case. It is actually a different random sample of advisors using social media who are reporting a lower level of success than those advisors surveyed two years earlier.

Statistically this is an acceptable practice. Random samples are supposed to guard against selection bias. This is how marketers and political pollsters run their surveys. However, in this case I think it may lead many readers to come to a false conclusion that there is less value to be had for financial advisors on social media now compared to what existed back in 2009.

What I would really like to see is a second survey of the original participants that compares their sentiments in 2009 with the those of 2011. I suspect we might see a different picture emerge than what the 2011 survey respondents reported. Why? Well, I know two years doesn’t sound like a long time but when it comes to social media, it’s a lifetime.

The social media landscape in 2009 was vastly different than the environment in 2011

Below are a few simple facts about the environment in which financial professionals were operating in 2009 compared to those surveyed in 2011.

• The advisors surveyed in 2009 were likely, as a population, much earlier adopters of social media than those surveyed in 2011.
• The population of people and financial advisors on social networks was much smaller in 2009 than in 2011. To put it into perspective, Facebook had 25o million users  back in July of 2009 compared to approximately 900 million at the end of 2011. Twitter is said to have over 200 million users/accounts but over 100 million of those accounts were added in 2010.
• The volume of posts from individuals and brands was much smaller in 2009 than it was in 2011.

Social media in 2011 was vastly different for financial professionals than it was in 2009. This is important to understand.

Why is the difference in the social media landscape between time periods important?

The logical assumption is that it must have been easier for advisors back in 2009. Since social networks and the concept of an interactive web were so nascent by comparison, advisors who were first on the scene found the streams of Facebook, Twitter and LinkedIn paved with gold. The simple act of being on social was enough to make the skies open up and rain assets under management.

As funny as that image is, it actually was a different world back then. As someone who has been using social media since 2004 I can attest that it was much easier to gain access to influencers before their follower counts exploded into the millions and it was much less noisy in peoples streams before every brand in creation started interacting with us all. But, I can also tell you from personal experience that the early (bleeding edge early) adopters back in 2009 and before saw something the rest of the world didn’t yet grasp.

The early adopters saw opportunity before anyone else. We saw that social media was where the world was headed and we got to work. We joined Twitter before Oprah and Ashton Kutcher put it into the collective consciousness. We were the ones inviting our professional networks to try this new thing called LinkedIn and convincing our friends and family that Facebook really had value. So in many ways is was significantly harder to find success on social media back then mainly because the tools were not as widely adopted by the general population.

Convincing people to join a social network is substantially more labor intensive than asking them to connect with you once they are actively using the network.

The opportunity for financial professionals using social media is still great for those who are willing to put in the effort and use best practices.

Success in any business endeavor requires work. It takes effort to build a network and it takes a consistent amount of interaction with that network to build the trust and familiarity necessary to drive business results. I suspect, based on what I commonly see, that many of the advisors surveyed have not yet put the effort into social media that the original population had when it was surveyed.

This suspicion was echoed by the study’s author as well when we talked. His take was that many advisors are sort of poking at social media by publishing links to their blog posts and market commentary but not going much further to build rich interactions with their networks.

This is not to say that the 2011 advisors were lazy. Far from it. They took the initiative to explore new tools and channels for marketing and client service. These advisors, like the 2009 participants, want to grow their business and serve their clients in a manner that suits their needs. However, the bleeding edge advisors I mentioned above were the innovators and pioneered the new space. The next wave likely jumped on to social media without the full conviction necessary to build a robust network and the marketing savvy (as Ron say in his subtitle) to take advantage of the network they did build.

This phenomenon is common. The innovators come first. These people are driven by a fire within to blaze a new trail. Tales of the innovators’ success is told far and wide. Excitement spreads among those itching for an edge and the second wave begins its pursuit of success. In this next wave some succeed and some come up short. Tales of disillusionment and risk begin to bubble up and people wonder if the tales of success were but a fantasy. But then, as the dust clears people begin to see it clearly…the innovators were right. Their vision of the future was true and now a system of success begins to be developed and honed.

A dramatic rendition to be sure but this is exactly what we saw with the gold rush, the industrial revolution, the internet boom, e-commerce and with social media usage in unregulated industries. The brute force, over the top efforts of the early adopters eventually lead to repeatable patterns that others can use to achieve their own success. Systems like the Social Business Activity Cycle are very prescriptive and a direct result of those early efforts.

In my next post I will share a very numbers focused pattern for success. I’ll start with a simple question “How many clients, prospects and referral partners are you connected to via social networks?”

Last week I sat down with Socialware CEO Chad Bockius for our 2012 Predictions webinar, in which we discussed the social media trends he sees emerging in financial services. Now you can listen to the archive of the webinar to hear why Chad thinks that this is the year when social business gets personal, along with his specific predictions for consumers, financial advisors, regulators, and enterprises.

Social Business Questions Advisors and Enterprises Must Answer

Early on, Chad made the observation that “Social is how we live now—not just how we play,” and pointed out that consumers are increasingly turning to their social networks for trusted recommendations on handling their finances. We then talked about a number of issues that financial professionals must address if they want to get the most out of this sweeping change, including:

• What do enterprises need to do to build momentum in social business?
• “Social is the unfair advantage of 2012”—but how engaged does an advisor need to be to expect returns from social?
• What actions can we expect from the SEC and other regulators this year, and what can companies do to be ready?

As you’ll hear in the webinar archive, we left half an hour for Q&A—but still weren’t able to get to all the topics raised by audience members. Here were some of the questions we discussed:

• “Companies are losing support and engagement from the broader firm because only a select few have access to social media. . . . What would you recommend?”
• “Do you have any advice for social networking as it pertains to independent broker/dealers? Is there an added benefit in social media for a B2B-based firm?”
• “When you talk about 100% adoption, are you referring only to the sales force, or to all employees including marketing, product, and support personnel?”
• “We have brokers who are on LinkedIn and they always ask, ‘I’m on LinkedIn, I have connections, now what?’ How would you answer them?”

To hear the discussion around these questions and many others, click here for the webinar archive page. And feel free to leave more of your own questions in the comments on this post.

Image source.

Substantial social media change and growth

The entire social media landscape has evolved quickly on the regulatory front (the release of FINRA 11-39 was already months ago!), technology front (numerous updates to Facebook, LinkedIn, Twitter, and more), and also, very importantly, best practices as financial advisors discover and improve upon using social media to develop new and strengthen existing business relationships.

A few weeks ago, Chad Bockius, Socialware CEO, and I hosted a 2011 Year in Review webinar. There were so many potential discussion topics, yet we focused on a few specific points:

• Growth of Facebook, LinkedIn, and Twitter
• Evolution of the regulatory landscape (For even more recent developments, read about SEC and FINRA updates this week.)
• What it takes to deliver social business success within a firm
• It’s about the client, not the firm: how client relationships are changing and why social media matters.

Future social business potential

Since we are already in the second week of January, now it’s time to move onto the potential of 2012.

This week, Chad tackles 2012 Predictions for Social Media in a live interview regarding what to expect going forward. Social networking is getting personal for firms. Here are few topics that you can look forward to exploring:

• Overarching trends for business social networking
• Realizing corporate leadership commitment for social media
• How to grow social media use effectively throughout your organization
• What are some of the emerging social media technologies for 2012?

Tune into the webinar and the Q+A to learn more about what to expect for social business developments in 2012.

You can have the best product or service in the world but if it doesn’t fit the customer’s needs or desires it will still find its way onto the fail pile. Consumer behavior is also important when it comes to your marketing and communications efforts, including social media. We live in a day and age where people fast forward through commercials on their DVRs, avoid ads altogether with Spotify and let incoming phone calls go straight to voicemail. If you want to get the attention of your target market today you need to engage on their terms.

Check your assumptions about social media.

We are all guilty of making assumptions from time to time that are later proven false. I shared one of my biggest misses in a post about the importance of connecting to active users on social networks. It took me a few months to come to the realization that Twitter is a powerful tool for the financial professional. Like I did, I am sure you have a few assumptions about how you will use social media, what it is good for, who uses social media and which tool is best for you.

Below is a short list of assumptions I have heard in my conversations with financial advisors in 2011. Each assumption is a challenge that needs to be addressed before you, the advisor, can achieve success with social media in your practice.

• “My clients aren’t on social media.” Are you sure? Have you checked? With 800 million people on Facebook, 200 million Twitter accounts and 120 million on LinkedIn are you sure none of your clients are using social media? The big problem with this assumption is that it halts you from digging in to see which clients are using social media and what are they using it for.
• “I’m only going to focus on LinkedIn because that’s the most professional network.” True, LinkedIn is a professional network. However, are all your clients professionals who spend significant time on LinkedIn? LinkedIn is important and a great source for networking and seeing money in motion opportunities created by people changing jobs but what about small business owners or people who don’t really do much business networking like say…developers? How much time are these people spending on LinkedIn? Be aware that your clients and prospects may not have the same preferences when it comes to their social networks of choice.
• “I am going to use a Business Page for all my professional interactions on Facebook. I don’t want to mix personal and professional networks.” Did you know that over 90% of the people who “Like” your Facebook Business Page will never come back to that page? Your Facebook Page also can’t friend people on Facebook, so you are going to have work extra hard to drive traffic to your page to generate likes so you can take advantage of all that Facebook has to offer. Should you have a business page? Sure, but remember people are connecting with you not just your business.
• “I’m never going to get on Facebook. I’m a private person. I don’t want people knowing everything about me.” Come on…we all remember plenty of people (maybe you were one of them) who said they saw no need to have a cell phone or that the internet was a fad. I had people tell me the same thing about LinkedIn back in 2004 but they are all using the service now. Planting your foot in the ground doesn’t help you explore the potential value of a new technology. What’s worse is such a statement increases the likelihood that you will be a laggard and feel completely out of touch with your network at some point in the near future. Lastly, who said you have to share details about yourself that you aren’t comfortable sharing on Facebook? It’s not like joining Facebook magically causes all of the most intimate details of your life to be sucked in. What’s most important is that you are there for your clients and prospects when they are sharing things that are important to them.

How your clients, prospects and referral partners use the tools available to them should be the primary driver of your social strategy.

When in Rome…Go Native!

You wouldn’t show up to a black tie dinner wearing shorts and flip-flops just as you wouldn’t go to the clambake at the beach in a tux. Observing the cultural norms of the community and the situation is key to successful networking. I often use the cocktail party analogy to illustrate how to effectively work the “social media” room. The key takeaway being that you should consider your participation on social networking sites to be akin to your attending a real world social event.

More importantly, remember you actually KNOW the people at this social event. You need to be real and approachable with these people.

The assumptions listed above and many other preconceived notions can hinder your ability to navigate this new world. This is especially true if you let it blind you to the value of how your clients, prospects and referral partners are choosing to engage online.

What should drive you as a professional in any social situation is a desire to add value and build relationships. Relationships are built on shared interests, values and connections. Your ability to add value to those with whom you have, or seek to have, a relationship is predicated on your relevancy to that person’s life. Value, is created in many ways (see Maslow’s hierarchy of needs) and people engage at nearly every level you can imagine via social.

To be successful you have to pay attention to how, and why, people are using the tools. Here are a few things people use social media for:

• Connection – People are social beings. They love to connect with others. Using social allows them to feel connected and ensures they will never lose touch. Your clients, prospects and referral partners are people too.
• Fun – People like to laugh and play. “But, I want to make money!” you say? Hello?! Golf course, tennis, sailing, wine tastings….any of these ring a bell? You are already out there having fun with your network. You can do it here too.
• Venting – People love to blow off steam. It’s not uncommon to see someone go off the hook about the little things that drive them nuts on social networks. You can learn a lot about people by understanding and identifying with their pain points. Remember, people want to be heard and understood.
• Requests for Help – People turn to their networks for referrals (that got your attention), information, support and occasionally genuine pleas for help. Does it makes sense that you might want to be there for your network when they need help? If for no other reason than to protect your client base?
• Exploration and Discovery – People love to find new things, venues, services, entertainment and connections. The cool thing is, they tend to remember the people who introduced them to the new hotness very fondly.
• Sharing and Thought Leadership – I put this one at the bottom so you would have to scan through the others and let their importance sink in. People absolutely share business updates and thought leadership on social channels. They have professions and goals too. They want to plug in to social in hopes of their network spreading their message just like you do.

The list could go on forever I am sure but you get the point. Your network is on Facebook, Twitter, LinkedIn and beyond and they are using the tools for all sorts of reasons in all sorts of ways. Your job…join the conversation.

Podcast about Social Business for Financial Services

Earlier this year, I had the opportunity to speak with Donna Sullivan of LIMRA about the social media developments in the industry.  We recorded an 11 minute podcast, LIMRA Industry Pulse Podcast: Social Media Use in the Financial Services Industry, that highlights our conversation surrounding how networking has evolved for agents and advisors, how social media leaders reflect on social media for financial services, and also what advisors are saying about the opportunities and challenges of social media.  There are also related videos with more detail to these conversations.

Business Social Networking: Stages and Success Metrics

More recently, I was fortunate to speak to marketing leaders from more than a dozen firms at a meeting we hosted in Boston.  There were representatives of wealth management, asset management, insurance, and more.  The meeting discussion took many twists and turns about social media, but one observation really stayed with me after the meeting.

One attendee who is responsible for the social media roll out to thousands of financial advisors shared a very nuanced and skilled philosophy about preparing the firm to be “social media ready.”  This included cross department conversations and alignment, education to create social media content or retrofit existing content, train corporate and field teams on social, and to develop measures of success that made sense depending on the stages of the process.  For example, the firm would not plan to measure social media success in terms of lead generation until this process was in place, advisors were trained, and these advisors had the time to build their social network connections.  This methodical and thoughtful approach was setting the firm up for alignment and social media success.

Upcoming: Social Media 2011 Review, FINRA 11-39 and more

We are all looking forward to the 2012 conversations to begin, but before leaving 2011, Chad Bockius, Socialware CEO and I are hosting a 2011 Year in Review webinar on Friday, December 16.  We welcome you to join us and compare if our highlights from the year match yours and perhaps provide additional insights.

Yes, I saved the most obvious social network for the end in this series. I tackled Twitter first because it is the least understood and most commonly overlooked tool by financial professionals who are getting started with social media. I then wrote about Facebook because it is the largest network of the big three and no social media strategy would be complete without a plan for Facebook. Now, let’s dig in to the power of LinkedIn.

LinkedIn’s Value is Obvious

A simple search for “financial advisor” results in over 361,000 people on LinkedIn who declare, or have previously declared,  themselves to be financial advisors and searching for “financial adviser” yields another 55,000 for a total of 416,000 FAs on the network. This is a 20,000 person jump from about a month ago when the same searches yielded 395,000 advisors. Financial professionals get that LinkedIn is important and they are there in big numbers.

The reason we see such big numbers is that LinkedIn’s professional network structure is very logical and natural for the financial pro to understand. Advisors, agents and bankers are used to listing their professional credentials and LinkedIn makes it easy to enter ones relevant information for others to discover. The concept of having a digital resumé for clients, prospects and referral partners to view and share is a no brainer.

Sadly, due to regulatory constraints and a lack of education on the ins and outs of new media this is usually as far as financial professionals get with LinkedIn. They create a profile, connect to a few people and that’s it.

The Problem: No One is Looking for You

Sorry, it’s true. Despite your amazing LinkedIn profile and the time, money and energy you poured into your own website, no one is looking for you. Sure, there will be the occasional connection request and you likely get a little traffic on your site. The hard truth is however, few people are searching LinkedIn or the web for “financial advisor” or “insurance agent” in hopes of finding the person who will be their trusted advisor. In order for LinkedIn and the web in general to work for you, you are going to have to do a few things. The good news is LinkedIn makes these things easy and if you do them you will have an unfair advantage over your competitors.

Three Game Changing Uses of LinkedIn

LinkedIn is not meant to be a static website. It is a networking tool. Use it as such and you will stand out. Why? Because most people rarely use LinkedIn and your activity will stand out significantly. So, what should you do?

1. Listen for Job Changes – The average person only visits LinkedIn for two reasons. To add or accept a connection into their network. Or, to update their profile with their new job information. When someone changes jobs it frequently means there is money in motion, excitement, anxiety and a lot of questions in the offing. If you are listening, you can be the one to reach out with a hearty congratulations or a comforting tone (in the event of an involuntary separation) and be the trusted professional during a person’s time of need. LinkedIn makes it really easy to listen for job changes. Just open that email you receive each week and scan through the profile updates or go to LinkedIn and view profile updates in your stream.
2. Choose a Path of Pursuit – Do you have a market niche? One of the first rules of business is to “niche thyself” as my friend Guy Kawasaki likes to say. All businesses should have a target market whom they feel they can serve better than their competitors. Your market might be women in tech or Austin area professionals working at software companies or Boston area doctors or even in some circumstances employees of a specific company. LinkedIn’s advanced search makes it really easy for your to find the people you serve best. As an example, if I were your client you would already have knowledge of my 401(k) plan and Socialware’s options program. You would likely know what Socialware does and be able to have a knowledgeable conversation on the topic of social media in financial services. And since referrals are the lifeblood of the financial professional’s business, you would ask me to refer you to other Socialware employees.
3. Build a Big Network – One could argue that this should have been number one. But, I think having an understanding of why LinkedIn is so powerful and how you will extract value from your networking efforts needed to be discussed first. Now that you “get it” you need to get busy building a robust network. Listening for job changes from a network of 20 people or choosing a path of pursuit from a small network will likely not produce the results you are hoping for. As I wrote in an earlier post, connecting to active social media users is the key to success. Think of it like this, if 10% of your connections on LinkedIn were to change jobs each year (likely a conservative number) how many prospects with money in motion would your network produce? If you are connected to 20 people, you’d have 2 prospects. Connecting to 200 people, which is well within reach for anyone, would yield 20 prospects a year. And of course you can enhance this further by building a network with the path of pursuit concept.

LinkedIn may not get the attention of the masses like Facebook and Twitter but as the Grand Daddy of the big three, it was my first social network, it has proven to be a necessary tool for any professional who is serious about building lasting business relationships.

I’d like to hear from you. How are you using LinkedIn in your practice? Have you had success finding clients using LinkedIn? Are you connected to your current clients there? Did I miss anything that you think is really a game changing use of the tool?

Much has already been written about the fact that “liking” a piece of content can be viewed as an endorsement (for now I won’t go into all of the compliance issues associated with endorsements, entanglement, etc.). As a result most firms with registered reps choose to block this capability on the social networks.

Before going any further let me offer a quick 101 class on sharing content. There are in fact multiple ways to “share” content and information across Facebook, LinkedIn and Twitter. Likes, Shares, Favorites and ReTweets – these are all actions you can take on these popular sites but all basically produce the same result. They publish a “message” to your social network thereby spreading the content further. Since it was an action you took there is a perceived endorsement of that content.

To make things a little more complicated we also have to remember that “liking” on Facebook has multiple uses. It is used to share information and show interest in a particular post but it is also used to connect to Facebook Pages (vs. adding a friend on a personal Facebook page). For the latter you are basically subscribing to that Page, opting in to receive that Page’s updates.

As a test I wanted to see if the terms around content sharing affected a firm’s policy. In fact, today it does. We analyzed policies from across the industry and found the following:

• 36% block Facebook and LinkedIn “Likes”
• However, for those that block Facebook Likes, 0% block LinkedIn Comment Sharing, News Sharing and Update Sharing.
• For those that block Facebook Likes only 20% block Twitter Favoriting and Retweets.

It would appear that the action of “liking” is viewed differently than “sharing.” But should it? I would suggest no. If your policy is to prohibit the programmatic sharing of content (meaning it is shared by clicking a button vs. posting something manually) then that policy should apply to all social networks, for all content.

Let’s dig into the notion of creating a basic post on these social networks. For example, creating a status update on Facebook or tweet on Twitter. Those posts may be original content or they may be a reference to some other piece of content you’ve found interesting. From this perspective you could argue that if you are going to block “liking” (used in the generic sense) then you should also limit the posts being made directly via the social networks themselves. While I hope this is not the case I feel compelled to offer the perspective.

One thing I think we can all agree on is that whether it is social networks or some other medium the test is of the content itself. Sharing a post about the Cardinals winning the first game of the World Series (Go Cards!) clearly does not pose a risk, whereas sharing a message on a specific financial product could…it all depends on the content. As you can see, content is king. The message should be scrutinized vs. the action that delivers it to your social network.

What is your take? We’d love to hear it. Just leave a comment below.

And one more thing, this will be one of the many topics we are discussing at our Compliance User Group on November 4^th. If you need more information please contact your Customer Success Partner.

We just released the 2011 version of the survey results with even more data about the impact of social media on the financial services industry, particularly focused on the advisors themselves.

Here’s some background on the advisors:

• Age- It wasn’t just the younger advisors who said they were using social media.  75% of the advisors replying to the survey were 36 years or older.
• Practice type- Advisors from all segments expressed interest in the survey.  Independent advisors, others with large firms, advisors just starting, and many with very established books of business.

Social media usage had definitely increased since last year.  In our 2010 survey, 60% of the responding advisors were using social for business purposes.  Fast forward to this year, and the number was greater than 80%.  And they are seeing results telling us about the referrals, prospects, and new clients coming from developing and deepening relationships through social media.

Prioritizing social media among the advisor’s tool set of options is increasing as well, so it’s not just a matter of “using social media.” Here’s how some of the advisors described social media in their own words:

• “This is where the people are.”
• “I think it’s a must going forward if you look to be competitive.”
• Social media is a “great way for prospects and clients to learn more about us and deepen relationships.”
• “We want to grow our firm by 20% annually for the next 5 years. We find social media to be an incredibly cost effective way of achieving that.”

To learn more about the survey results, the executive summary is available now.