RIA Compliance Blog
According to American Century Investments’ third annual Financial Professionals Social Media Adoption Study, more advisers are starting to use various forms of social media for professional uses. The results were drawn from an online survey of 300 financial professionals who are employed as financial advisers, brokers or registered investment advisers. The participants were members of Research Now, and they averaged fourteen years in the financial industry.
The study showed an increase in the use of smartphones and other mobile devices to access social media websites than in previous years. Approximately 35% of advisers claimed to use smartphones for social media access, which is up from the 27% in 2011. Also, there was an increase in advisers who used mobile devices such as iPads and other tablets for access from 11% last year to 22% in 2012. The majority of financial advisers; however, still access social media through laptop and desktop computers.
Advisers are also accessing social media websites multiple times a week, according to the study. Six out of ten advisers are using social media for business several times a week and even 27% of advisers are accessing the websites on a daily basis. A poll of all the advisers who already have profiles on social media websites showed that Facebook remains the most popular site with 73%, which is an increase from 55% in 2010. LinkdIn and Twitter also increased participation to 62% and 27%, respectively, from 2010. Almost nine out of ten financial professionals have a business or personal social profile or account.
There was also a significant increase in the amount of advisers choosing to maintain a professional blog. Advisers choosing to use a professional blog increased from 9% in 2010 to 17% in 2012. According to Jennifer Sussman, Director Digital Engagement for American Century Investments, “A blog is a great way for advisers to get their message out while revealing something about their personality, which helps in prospecting and building relationships. It takes commitment to continue sharing insights, but when advisers do it well and optimize for search engines, they’re able to draw traffic from a much broader audience than one-on-one conversations can reach. Plus, the lengthier format and auto-archiving capabilities make it easier to meet compliance requirements within our regulated industry.”
The biggest concern for advisers still continues to be ensuring that while using social media they are following all of the regulatory and compliance rules. The next concern for advisers is potential privacy breaches. Finally advisers are concerned about company or home office restrictions. Even with these concerns, 60% of study participants claimed that their firm has a form of social media policy, which is an increase from the 53% reported last year.
The survey stated that 57% of respondents claimed that social media is an “emerging trend with significant future potential” for businesses. 21% of advisers also believe that social media is already producing tangible results for their business, and 14% believe that social media had a “high overall value.” All of these numbers have increased from results in previous years.
Parker MacIntyre provides legal and compliance services to investment advisers, broker-dealers, registered representatives, hedge funds and issuers of securities, among others. Our regulatory practice group assists financial service providers with the complex issues that arise in the course of their businesses, including compliance with federal and state laws and rules.