“Twitter gets no respect,” was how RIABiz summarized the reaction of 1,200 RIAs surveyed about their social media use and reported on in a study published yesterday by Schwab Advisor Services.

Social media was just one of four topics included in the July 2010 Independent Outlook, the others relating to advisors’ views on the economy, investments and clients. Considering the gravitas of the other subjects, we think social media in general is getting some respect just to be included within the scope of the study. Twitter? Well, as we’ve noted before, Twitter isn’t necessarily the social medium that comes easiest.

RIABiz is a must-read every morning, and we are big fans of the publication and the team headed by Brooke Southall. Southall’s article today “9 things worth knowing from Schwab’s newest advisor study” reported on the full scope of the research. So, we do understand that two graphs on social media would have been too much, and all of the reported data on advisors’ views of social media was in the article.

But by definition, our focus on AdvisorTweets.com and here on the blog is narrow. When we went to the slides that Schwab provided about the study results, we decided that we’d show both of the social media-related graphs. Again, the data in the second graph was reported by RIABiz but there’s something about a pie chart–in other words, 66% are non-skeptics? And, note the Schwab headline: “Social media is new frontier for advisors.”

Across the industry, there is significant effort being made to understand and be in a position to support financial advisor interest in and use of social media. With two-thirds of Schwab advisors describing themselves as tentative users at the minimum, we think that this data supports the exploration of social media for advisors in the business-building mode.

Join us when we moderate an Advisor Perspectives Webinar, “Engage The Media Using Social Media” at 4 p.m. Eastern/3 p.m. Central Wednesday, September 15. For more information including our national and local media and advisor panelists, see our blog post or register here.

A social networking site launched today with the promise of serving as a melting pot for financial services professionals to come together on social media issues unique to the industry.

SocialTurns has been created by Socialware, the Austin, Texas-based social middleware platform technology provider. In the first few preview weeks, Socialware and others have recruited financial advisors, insurance, marketing, Compliance and technology professionals as members. As a result, the site is almost 400 members strong on its launch date.

“In a recent Socialware survey on social media usage among financial advisors, it was clear that although there is massive business value in social media for financial professionals, there is also a lack of awareness on how to do it compliantly and effectively–something that leaves the industry as a whole wondering where to turn next,” said Socialware CEO Chad Bockius.

Bockius hopes that creating a centralized location for social media-related discussion and questions will help move the industry forward. I do too, and I’ve committed to take part in the SocialTurns Council, which Bockius established to keep the conversations going on the community site.

The Council includes many names AdvisorTweets followers will recognize:

• Pat Allen, Principal, Rock The Boat Marketing (and AdvisorTweets)
• 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

We think this could be a big deal for employees of financial services firms, slightly less so for financial advisors who are already proficient online networkers and may prefer their ad hoc, more tightly focused communities. Still, one can never have enough places to turn for help on a subject as dynamic and ambiguous as social media policies and practices.

Join today and become acquainted with what may be a significant industry resource.

More than half of U.S. financial advisors (53.3%) work on a team with at least one other advisor, according to kasina’s latest FA Vision Benchmarking Survey.

For the manufacturers of the investment products that advisor teams distribute, that poses a challenge. And, kasina’s Lee Kowarski says asset managers may need to improve their ability to support this shift from individual advisors to advisor teams. “Changes to CRM and sales reporting systems, enhancements to Web sites, additional training for wholesalers” will be required, Kowarski says. We know that such changes are well underway at some firms.

Those are the to-dos for asset managers. We’re wondering about the advisor teams themselves and specifically how communications functions are being shared.

Committing to social media requires a significant investment of time. Does the advisor team structure enable advisors to share the work required of social media participation? And if so, do social media-active advisor teams have different technology requirements for their own customer databases, Twitter applications and social media archiving solutions?

Or, is the engagement that social media introduces something that doesn’t lend itself to be shared across a team?

Our observation of advisors on AdvisorTweets produces nothing conclusive.

All of the favicons of advisors followed by AdvisorTweets show only individuals, plus or minus a stray child or dog. There are no favicons made up of mini multi-face mosaics similar to what accompany some known Twitter account team profiles (Pimco, RIABiz).

Then again, as we slowly but steadily add to the AdvisorTweets’ database, it’s fairly common to see a Twitter account maintained by an individual whose Twitter profile links to a firm with multiple advisors. Could that individual be doing the tweeting for the team? And, of course, firm logos are common favicons.

Advisor teams, what do you say? Can you assign your social media presence to an individual on your team? If not, why not? We’re interested in what you’re thinking–please comment below or send an email if you’d prefer your response to be anonymized.

AdvisorTweets aggregates tweets so it would make sense that we confine our comments on the AdvisorTweets blog to Twitter. And we usually do…but we came across a few items this week about Facebook and LinkedIn that add to the growing body of knowledge about financial advisors’ use of social media. So, we thought we’d pass them on.

On Tuesday, the freshly named Huntington Asset Services (formerly Unified Fund Services, Inc.) hosted a Webinar whose overall theme was social media enablement. But we heard something about Facebook that we hadn’t heard before.

Advisors have been repeatedly told that they cannot provide or accept LinkedIn recommendations and that using the Favorites feature on Twitter is verboten. But the Huntington’s SEC Compliance discussion expanded the ban to include Facebook.

“Don’t use the Like button and discourage your friends from liking your content,” advisors were told. Is this consistent with what other Compliance officers are saying? Please comment below.

New LinkedIn Insights

Advisor Websites’ LinkedIn survey results, published yesterday, provide some new insights on financial advisors’ use of LinkedIn. Loic Jeanjean from the Vancouver, British Columbia-based firm tells us that 74% of the 349 survey respondents were from the U.S. and the rest from Canada.

The combined data muddy the usefulness of analyzing some of these findings to understand U.S.-based advisors. For example, responses to questions about use of LinkedIn recommendations and participation in LinkedIn Answers would be really interesting, if segmented by country affiliation. Indeed, subsequent surveys will be segmented, Jeanjean says.

We recommend the full survey report to you. Here are three data points we found thought-provoking:

• Just 55% of advisors add client contacts to their networks. It’s more common to add friends, colleagues and business partners.
• 60% of advisors are updating their LinkedIn profiles monthly. That sheds some light on the burden to be placed on Compliance review.
• 25% are running pay per click ads–higher than we might have guessed (see our guest blog post on the subject).

We jumped off the grid for the first three days of this week but have returned to see that we missed two Webinars relevant to financial advisors’ use of social media. We thought we’d mention them here just in case you too were enjoying the natural beauty of Door County, Wisconsin or some other special summer place.

Best Practices for Advisors Using Twitter

“…and Twitter is a distant third.”

That’s what we find ourselves repeatedly reporting about survey findings tracking how advisors are using social media. The benefits and use of LinkedIn and Facebook are more readily apparent.

But Twitter was front and center at Tuesday’s Webinar “Best Practices for Driving Business and Connecting with Customers on Twitter,” the latest in a social media series organized by Socialware. The Webinar was moderated by Mike Williams, Socialware vice president of sales and business development, with Cathy Curtis, certified financial planner and investment advisor, and D. Bruce Johnson, president & CEO of Advisolocity. On Twitter, they’re known as @MikeWilliams2, @CurtisFinancial and @DBJAssociates.

The Webinar begins with some basic slides but hang in there for the discussion. As she has been in previous Webinars, Cathy Curtis is both generous and specific in her recommendations of how advisors can optimize their use of Twitter. She has a vibrant Facebook page and a newly designed blog but Curtis says Twitter is her favorite social media tool.

Johnson from Advisolocity, a full-service Internet marketing resource for advisors and firms, also weighs in with useful suggestions on how to best manage a Twitter presence.

Just as an aside, we were genuinely surprised by the mention of AdvisorTweets and appreciate the comments.

Social Media Overview For Advisors

Monday’s Webinar by Advisor Websites was broader in that it appeared to review LinkedIn, Facebook, Twitter and YouTube. While a replay isn’t available, the presentation does a good job of making the argument for participation, including some compelling data and advisor-specific ideas.

Did you attend either of these? If so, can you expand on our admittedly bare bones report? We welcome all comments below.

“Advisors are developing ways to use social media and, as a result, have seen significantly more growth and expansion of their client bases.”

This conclusion is from a new independent study commissioned by Pershing Advisor Solutions LLC, a BNY Mellon company, developed in conjunction with Aite Group. This is the first study we’ve seen that links financial advisors’ use of social media with the growth of their firms.

Creating Growth: The Increased Use of Social Media by Independent Advisors reports on results from 144 U.S.-based registered investment advisors (RIAs). One-third of the respondents were employed at firms with more than $1 billion in assets under management and 37% work for firms with less than $100 million under management. Naturally, we wish the sample had been larger but trust that Pershing and Aite have confidence in their report.

Read the press release and be sure to see RIABiz‘s expanded coverage, including charts and reaction interviews.

Twitter always comes in third behind LinkedIn and Facebook in advisor adoption surveys. In one of our comments to RIABiz, we likened joining Twitter to walking into a bar where there are conversations underway and it takes some time to acclimate. In building the AdvisorTweets database, we see advisors joining Twitter, giving it a go and then abandoning their accounts.

To be sure, some abandonment may be related Compliance issues but most abandoned advisor accounts have few followers and appear on few Twitter lists. We’re sorry about this, given the success that other advisors have. And, we happen to think that Twitter is the social networking platform most appropriate for advisor marketing purposes.

We’ve commented on this before and do our best to support new recruits by forwarding their tweets and adding them to our JustAdded Twitter list. A few other ideas are in the works, as well.

Do you have any suggestions about how to give advisor Twitter newbies a lift up? All are welcome below!

We think of @curtisfinancial @curtisasmithcfp and @jeffrosecfp as among the legends showcased on AdvisorTweets.com. Because Twitter enables us to follow their (and other U.S.-based financial advisors’) lives and times, we care about what they think about all forms of social media.

When WiredAdvisor.com announced a Webcast (replay here) featuring these three on the subject of blogging, there was no question we’d be logging on to it live. We took notes and think you’ll be interested in what they had to say but… because we think there’s broad interest in how financial advisors are using blogging to project their own voices, we’ve posted our report Meet 3 Wired Advisors Who Are Mastering Social Media on our sister site Rock The Boat Marketing.com.

Hope you’ll find your way over there.

Social media and the regulations that apply to financial advisor participation can be puzzling enough.

It doesn’t help when a top advisor publication leads the kind of discussion that took place Tuesday in the Investment News “Compliance-Savvy Ways to Use Social Media” Webinar. Deputy Editor Evan Cooper ended the Webinar by saying, “We may not have come to any kind of total definitive compliance-savvy ways to use social media, but I think we put the flashlight there in a way that we maybe hadn’t been shining it before.”

We disagree. It was a disjointed presentation that could add confusion and even apprehension to a topic on which the industry has been gaining understanding. It fell short of the information quality that long-time readers expect of Investment News.

Below are our notes, which include the insights and information that the Webinar provided and where the Webinar mis-stepped.

The panel included Julie Gebert, Compliance Assistant Vice President of Cambridge Investment Research, Inc., a broker-dealer whose pilot program is indeed identifying ways to use social media. Also on the panel was Erin Reeves, associate with Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C. Reeves said clients of her “conservative” law firm were still developing their social media policies. Reporter Davis D. Janowski moderated along with Cooper. An LPL advisor who had been scheduled to take part was not able to participate “for Compliance reasons,” according to Cooper.

Broker-dealer adoption of social media

“Most of our clients have elected at this point not to allow their reps to do much in social media until they see how FINRA is going to enforce the rules,” Reeves said. “I think everybody is sort of sitting back and waiting for somebody else to take the first step.”

“To me,” said Cooper, “it seems as if there’s so much liability, why bother? Why risk it? For what? I guess in their minds [broker-dealers’] there’s so much potential liability as opposed to maybe some nebulous or uncertain benefits, given the fact that, well, they won’t say this but so many of the reps they don’t trust and they may do something crazy. Why put themselves out there? For what reason? Maybe that’s why they’re waiting.”

In a later reaction to Janowski’s comments on archiving options for large broker-dealers and wirehouses, Cooper said, “It’s just my hunch that they’re not going to be in the forefront of allowing reps to do this. I can’t imagine Morgan Stanley or Merrill Lynch saying, ‘Oh, sure…’”

We found this representation of the pace of adoption misleading. Large broker-dealers and wirehouses are on record as saying they’re interested in and working on social media.

At FINRA’s March 17 Implementing Compliance Practices for Social Media Webinar, Bank of America Merrill Lynch Senior Vice President and Compliance Executive Douglas Preston said “a number” of proof of concepts are being worked on right now in social networking, including for the securities business (Merrill Lynch).

LPL CEO Mark Casady on social media--click on image to go to ICI page with video

Distribution leaders were questioned point-blank about social media’s relevance at the May Investment Company Institute General Membership Meeting.

In response, LPL Financial Chairman and CEO Mark Casady said, “We see Facebook and LinkedIn as critically important to advisors,” (and we’ve since seen LPL’s social networking materials).

Morgan Stanley Smith Barney Managing Director and Head of Wealth Management Andy Saperstein said, “Social media is here to stay..It will change how we (advisors) do business.” He said a LinkedIn pilot was in process. For his part, Fidelity Investments Institutional Services Company President Peter Cieszko pointed to his firm’s commitment to mobile applications, Facebook, Twitter, LinkedIn. (Watch the video from the Distribution Changes and Challenges session on the ICI site.)

An update on Cambridge’s social media pilot

In June Cambridge announced the launch of a social media pilot and that it expected to be the first “big independent broker-dealer” to extend a social media initiative across its entire network.

According to Gebert’s Webinar comments, the pilot was based on the results of an internal task force survey of Cambridge “rep/advisors.” The advisors expressed interest in Facebook, LinkedIn and Twitter, which Gebert said was a distant third.

Six weeks in, the pilot involves 25 advisors producing the most activity on Facebook. “LinkedIn is a professional networking site probably not aimed at client gathering and Twitter some people are still trying to figure out,” she said.

So far so good, Gebert said. “The [archiving] technology is working as promised,” but advisors have a need for marketing support that was unanticipated. “They’ve been told so long that they’re not able to do this that they didn’t include social media in their marketing plans,” Gebert said.

“The reason it’s still a pilot” is that the firm is now putting together templates for advisors to use, developing white papers as resources and helping advisors identify client profiles, etc.

Asked for an example of a social media success, Gebert described an advisor in a large metro area with a weekly radio show and offering regular Webinars. Promoting a LinkedIn and Twitter presence along with Facebook updates that appear on his clients’ and clients’ friends pages has produced more referrals than the radio show or Webinars, she said.

Compliance review of the pilot groups’ social media accounts has not been burdensome, she said. But review volume reflects Cambridge coaching to advisors “that a little can go a long way.” Gebert shared her personal opinion that more than once-a-week updates could annoy followers and cause them to un-follow.

“Are we putting a policy and procedure in place to control [the number of updates posted]? No, it’s up to people to know their clientele, maybe those with heavy stock portfolios need to update more often,” she said.

Social media archiving solutions

Gebert said the firm is using Socialware to archive Facebook, LinkedIn and Twitter accounts. When rolled out across the network, the cost will be $20/month, which Cambridge intends to pass on to advisors. “The assumption is that an office will sign up rather than individual advisors,” she said.

Webinar attendees were no doubt lost trying to follow the wandering conversation that ensued when Cooper asked about other social media archiving solutions. This was a missed opportunity to educate, even at a high level. Archiving is the key enabler for social media participation and, as was noted, will involve the industry’s investment of millions of dollars.

Interest in understanding the differences between the many options is keen, but the moderators substituted speculation for preparation. We were surprised by the sloppiness of this discussion, which included a few mis-statements by the Investment News moderators and Gebert.

For a better researched presentation of the array of what’s available from Socialware, Arkovi, Facetime, Backupify, Smarsh and Autonomy, see a July 8 EverydayTenacity.com blog post written by an employee of an investment management firm.
Disclosure: Rock The Boat Marketing, our consulting business, recently completed a limited strategic consulting assignment for Arkovi. We believe that it deepened our understanding of the market for social media archiving solutions without compromising our perspective. Our business endorses no vendors.

SEC vs. FINRA?

Reeves acknowledged incoming questions about how the SEC and FINRA might differ in their review of advisor use of social media. SEC-registered advisors are largely believed to have more latitude.

“In our experience, the SEC has just as much focus on these things as FINRA does. They often piggyback on what FINRA does in terms of enforcement,” Reeves said. “Erring on the side of caution, I’d comply with the FINRA rules. Don’t try to be cute and get around it because we don’t know how they’re going to react.”

Cooper followed up by asking Gebert, “Why do you feel you can do these things?”

“It’s the technology and it’s there,” Gebert replied. “With the commitment from our executive management team to allow for the resources to be able to do this, I feel very confident…When social networking first came up, no one knew where to turn first. We think the easy answer for firms is to just say so. But you just really need to pick apart what each of the items underneath social networking are and take it to the lowest denominator…and all of a sudden it’s not confusing.”