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.

Instead, Marketing should take up the challenge to perform true social networking by using social platforms to build direct connections with customers and prospects. To achieve this, marketers must answer key questions about our goals for social business, including:

• What messages does your firm want to deliver via social media?
• Will your use of social networking go beyond standard business communication?
• How will you drive real engagement—conversation—rather than simply publishing more content?

Marketing User Group Asks: “Social Content? Or Social Conversation?”

At Socialware’s latest Marketing User Group meeting, several members talked about the different types of content they have tried using to foster conversations on social networks. One member said that her firm had tried (with limited success) to start conversations around regulatory issues and accounting issues. Another member recommended putting oneself in the consumer’s shoes: “What do I want to hear from a company? Do I want them to sell me something?” In many cases, consumers probably do not want “brochure” content that aims to sell the firm’s products.

One attendee made the good point that content will differ based on the advisor and the type of clients served. Advisors ought to know what their clients want to hear, and prospects choose advisors based on styles of communication they like. This helps explain, for example, why some advisors constantly ask for more research to share, while others don’t want any. The goal of this particular attendee’s firm is to provide as much content as possible so that advisors can pick and choose what they need.

Should Marketers Start Conversations around Non-Financial Content?

As a marketer, do you believe it’s your responsibility to create content that is not financially related? For example, would you send out a message commemorating MLK Day?

In general, our User Group members agree that there should be a mix of messages, including topics outside of finance. One attendee said that his firm actively pursues other topics, for instance with content about families, living healthier, or keeping kids safe on Halloween. They find that this mix of non-financial messages is good for both retention and lead generation.

One attendee said that his company is focused not on pushing out just financial information, but on brainstorming articles and publishing content—financial or otherwise—each day that leads to conversation with prospects and clients.

Running the “Marathon” of Social Conversation

“You are embarking on a marathon.” That was the reminder offered by my colleague Carolyn Pawelek, who facilitated the User Group meeting. From everything we’ve seen, many advisors don’t know what to say via social media—and so they don’t say anything. Carolyn’s marathon analogy is meant to drive home the point that Marketing departments should provide tools for advisors to continually broaden their networks over the long haul.

Excitement and activity around social media creates intangible benefits like a greater sense of trust and connection between clients and advisors. These in turn lead to tangible benefits, from greater share-of-wallet for an individual advisor to higher revenue for the firm. But these benefits emerge most strongly when marketers and advisors invest the time and energy to build meaningful social connections.

Image source.

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.

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.

Most of a Financial Firm’s Profits are Made from Serving High Net Worth Individuals and Active Traders

There is a reason why financial services firms spend so much money, time and energy marketing to high net worth individuals and active traders. That’s where they make the bulk of their profit. Think about it, if a financial firm earns 1% annually on assets under management, a $7 commission per trade and maybe mere pennies per share on the spread for trades it takes big numbers to generate a meaningful profit. A client with a $1,000,000 balance would generate $10,000 in annual fee revenue and a trader who makes 500 trades a year would generate $3,500 in commissions plus a few grand in spread revenue. And because these investors might also trade on margin we can expect some earned interest revenue to be generated as well.

Now of course the above numbers are just revenue. Financial firms, like all businesses, have expenses too. The buildings, technology, phones, printing, postage, electricity to run it all and the employees that make it all happen. What this means is that not all customers are profitable for the company. A client with a $10,000 balance will likely not generate enough fees or trading revenue to cover the costs of serving him with the same high touch that is made available to the high net worth set and active traders. And since there are only so many high net worth individuals and active traders to go around the competition for these clients is fierce.

The Top Financial Advisors Also Produce The Bulk of the Profit

The 80/20 rule also applies to financial advisors in the same way that it applies to customer type. I recently spoke at an advisor conference where the attendees were in the top 15% of revenue producers. In order to qualify to be in that room they had to generate $750,000 in annual revenues for the firm. If we apply the same 1% model as above, each advisor would need to manage a book of business around $75 million or higher make the cut. If we assume that an advisor would manage 100 or fewer client relationships this means that each client would have at least $750,000 but likely $1 million or more in investible assets. There are only 8.4 million households in the United States with an investable net worth of $1 million or more and hundreds of thousands of financial advisors chasing after them.

Not Every Advisor Can Be In the Top 20%

The top 20% (or 15% as described above) is just that, the top. Not every advisor will make it to the top. Most of today’s top advisors got there because they were better at hustling for clients with the tools available to them in the past. When I ask these advisors how they built their book of business many of them tell me that cold calls, luncheons, referrals and traditional networking were all keys to their success. Those advisors who could burn up a phone and work a room (the right room) better than their peers rose to the top. Those advisors who struggle with these mediums either washed out or are growing more slowly.

Today’s Top Advisors Will Not Be Tomorrow’s Top 20%

Technology is frequently a disruptive force that shifts the balance of power much quicker than people expect. I have written before that advisors ignore social media at their peril. Right now there are advisors who are grabbing social media tools by the reins and riding them hard to build their book while advisors who are already at the top are holding on tight to the horse that brought them here. It’s only natural.

Will every advisor who is an active social media user make it to the top 20% in the future? No, of course not. Why? Because we are quickly moving to a world where every advisor will be using social media tools as part of their business just as today’s advisors all use the phone and email. Those who use social best will almost certainly rise to the top however, because social media is so much more than just posting updates. Social media tools allow a financial professional to do all the things today’s top advisors did to become successful with much greater efficiency than ever before. Meeting new prospects, staying connected, driving people to events, marketing, client service and staying informed are all aspects of growing a successful financial practice that are greatly enhanced via social media.

If you are a financial professional using or exploring the use of social media in your practice realize that the competitive edge is yours for the taking. Not every advisor is going to “get it” and many of those who do get it are going to tire or get comfortable and plateau. You have an advantage that you might not see again in your lifetime. Social media will never be this new again. If you want to be one of the top 20% who reaps 80% of the value now is the time to go for it.

If you are charged with leading the social media initiative at a financial services company my recommendation to you is to pay special attention to those individuals who are using social most aggressively now. Be sure to give them access to powerful and compliance friendly tools and start studying their behavior. Many of those advisors are going to be your top producers in the not too distant future. The urge to focus on today’s top advisors and drive them to social is understandable and you should do your best with that population if for no other reason than to protect their client relationships. But, there is lightning in the bottle with the advisors who are active on social media already.

With so much value tied up in the top customers and the top advisors it is critical to put a framework in place to connect the two now and for the future. High net worth investors are increasingly using social media and active traders are always looking for an edge, hence the rise of niche social networks like StockTwits. Not surprisingly, financial advisors have flocked to social in big numbers as have insurance agents and bankers to meet these high value clients on their preferred medium. Those who are active and productive early are going to capture the most value.

As social networks continue to evolve four years later, there is still a lot of truth in the POST concept since it speaks to the need to bring business objectives and the customer central to decisions about social media.

One anecdote that I heard recently from the Austin Facebook team is the insightful comment by the CMO of Diageo, Andy Fennell, who spoke recently about marketing no longer being like bowling where you are pushing out a message in hope of it hitting the audience.  Marketing is now more like a pinball game with dynamic interaction.  This involves listening, responding, engaging rather than just sending a message one way at people.

There continues to be new technology capabilities on social networks sites, but the question is still… what business objectives are you trying to achieve?  I overheard a set of questions during a social media conference along the lines of… should we do such and such on Facebook or on Twitter?  While each social network has unique aspects, often, the answer comes from what are you are trying to achieve and how will you measure if it is working vs. jumping directly to the features and capabilities of each individual social network.

One key strategy question is whether you are looking to use social media to speak as a company brand with an arm distance relationship with your fans, followers, or friends?  Another option for many companies with large distribution channels is to approach social media as a way to have a much closer, engaging relationship from person (advisor) to person (client or prospect) vs. a company speaking to people.  It may even be a combination of both strategies that works best for your firm.

So how do you not only get started, but start effectively, efficiently and importantly, quickly? If the social networks keep releasing new technology options, than there’s no time to spare.  That means looking for resources that already exist from trusted sources, so you don’t have to recreate the wheel.  Examples include:

• Policy templates
• Quick start guides
• Best practice examples aggregated from firms that have already initiated programs
• Programs to get employees up and running on social media

The discussion around social media has so many metaphors, but social media really isn’t like a light switch except possibly a dimmer switch.   It is your firm’s decision how quickly and fully to turn on the light and embrace social media while keep in mind those key considerations:

• People (your current and future clients)
• Objectives (what are you trying to accomplish and how does social media fit in)
• Strategy (quick start programs, best practice resources, and employee training)
• Technology (ensure compliance, enable measurable results, stay on top of social technology changes)

As I encouraged the attendees to jump into the conversation and share their experiences, questions and thoughts, only a few minutes passed before they responded.  This free flowing conversation created an unmatched dialogue specifically focused on the challenges and opportunities of social media in financial services.  During the forum breaks, there was so much conversation between the attendees representing more than twenty firms including wealth management, insurance, broker dealers, and industry associations, it showed the strong interest in this type of event.

All of us benefited from a variety of presentations including an update on the regulatory perspectives on social media use by Steve Selby, Director of Regulatory Services at LIMRA from the roundtable that Socialware and LIMRA hosted in May in Washington, D.C.  Panelists from Forrester, Guardian Life, LinkedIn, and Morgan Stanley Smith Barney, shared their thoughts and fielded numerous audience questions.  In closing the panel, each speaker discussed the one word that explained social media in financial services with answers including “everywhere, dynamic, efficient, relationships.”

Throughout the forum, attendees also discussed what it takes to adopt a culture that embraces social media and how to ensure firms are focused on the differences between social media and social business including the necessity to measure what the firm values when using social programs.

A lot of interesting stats were shared during the presentations.  For example, according to Forrester, 60% of individuals with investment accounts use social media and more than 90% of households with $1MM in investable assets are online. Speakers also made points including one from Steve Holstein, CMO of Guardian Life Insurance of America, “ Social media is here.  The question is what process to put in place to support it.” To learn more about the Social Media in Financial Services Forum, you can read the live tweets from the event by visiting twitter #fincmo.

Here are 4 ways to think about how you can utilize social media.

Your Personal Database:
Remember Bill Clinton’s index cards that we mentioned in a previous post. Bill Clinton created index cards for people that he met, along with a key fact about them. He would review and memorize these cards so that when he met people, he could not only call them by name, but also bring up a personal fact about each person.

That was before the age of LinkedIn.com or Facebook.com. You can now gather the personal information that Bill Clinton stored on Index cards and more just by visiting someone’s profile. Instead of building your own database, utilize pre-existing information on Facebook to gather personal information, and LinkedIn.com for professional information.

Easily Talk To Customers AND Their Friends:
The name of the game has changed. A birthday wish via a hand-written card has evolved into a Facebook post. While hand-written cards can still be very valuable, wishing a person “Happy Birthday” on Facebook.com reaches not only the recipient, but all of his network.

The other day, a financial adviser mentioned that his moment of clarity came on his Birthday when he received 50+ birthday wishes, with over half coming from his clients. Not only did all of his clients see those birthday wishes, but “friends” of clients who wished him a happy birthday viewed these warm wishes as well. What a great opportunity for warm leads!

Reach Prospects:

In the example above, you can see how easy it is to reach your customers AND their network. Referrals are the lifeblood of any business. On LinkedIn.com, you can look for connections of connections. By asking your connections to introduce you to their connections, you can simply expand your network to find new customers and partners.

Also, you can use Twitter to build your prospect list as well. Twitter users are very accepting of followers even if they do not know you. It is easy to “talk” to new people online. Through a quick search, you can find people that are researching finances or partner connections that can help refer business to you.

Time Savings Online:
Social media isn’t about changing your business strategy. The principles of building relationships and engaging with prospects are the same. However, the opportunities that social media can offer you can exponentially increase your reach, and save you time => Social Business.

Being effective is about using your time wisely to make the biggest impact. Social media gives you those tools.

With this release they have turned LinkedIn into a true daily destination. It is a critical step to becoming more Facebook like – at least in terms of how much time users spend on the site (the average Facebook users spends over 7 hours a month on the site!). For LinkedIn this will translate to more users, more engagement and of course more opportunities to monetize the traffic.

The notion of news curation is nothing new. In fact, we are all curators of news – we do it in our daily lives. Have you ever asked someone “did you see that story about the latest…? You have to check it out!” This notion of personal news curation adds value to the people we interact with, starts new conversations and exposes our interests in unique ways.

With LinkedIn Today they’ve taken a conversation that would happen when we see friends, colleagues, clients and partners and exposes it across your entire network and the networks of those in the industries you care about. In the process you learn not just about news, but also what matters to your network and the individuals it represents.

We’ve established this is a great source of relevant news but it is also a valuable fact-finding, engagement, networking  and awareness generation tool. Let’s look at each one:

1. Fact Finding: As news bubbles to the top of LinkedIn Today you not only see the content but also the individuals that shared it. This is valuable source of information for any sales rep or client manager trying to build a more meaningful relationship or looking for an opportunity to engage.
2. Engagement: Sharing out a news item implies a level of interest. Someone took time to post a message to his or her entire network that this piece of information was interesting. In return you have the opportunity to engage directly with that individual either by commenting back, or indirectly, by sharing that article out as well showing that you have shared interests.
3. Networking: Part of exploring a news story is seeing who shared it. This group will be made up of individuals you are connected with directly as well as those that you might wish to connect to. For those professionals looking to expand their network this exposure of content + connections is yet another way you can start to expand your own personal network.
4. Awareness Generation: Now that LinkedIn has over 100mm users it is more important than ever to establish and grow your presence on LinkedIn. If you’re producing valuable content for your industry and network be sure to include a LinkedIn Share button so the rest of LinkedIn can discover you and your great content.

Although the notion of content curation is nothing new, LinkedIn has found a way to make it all the more valuable for professionals. We rely on people we trust to help make critical decisions and seeing the sources they view as important will only help to deepen those relationships and discover new ones.