Although there’s still doubt among investment advisors about using social media as a business-building tool, a growing number of advisors surveyed for this year’s Brokerage Report Card are starting to realize that social media is becoming significantly more important in this role.

Nevertheless, some advisors said it’s their firm’s senior executives who need to change their mindset about the technology and allow advisors greater flexibility to use social media within their practices.

The overall average importance and performance ratings that advisors gave to the “support for using social media” category are still among the lowest of all categories, at only 6.5 and 6.9, respectively, but those ratings have risen steadily from 5.6 and 5.7, respectively, in 2012, when advisors were asked the question for the first time. This trend reveals that social media is becoming more important to advisors and that firms are doing a better job of supporting their advisors in using the tool – but full acceptance of social media remains a long way off.

Specifically, many advisors, especially those over the age of 45, continue to tell Investment Executive they do not care about social media; yet, an increasing number of advisors in that same age group said that social media provides more exposure for their businesses and is replacing more traditional methods of prospecting.

“[Social media] is going to be a great tool to get new clients. Cold calling is a tougher thing,” says an advisor in his 50s in Atlantic Canada with Toronto-based CIBC Wood Gundy.

Adds an advisor in British Columbia in his late 40s with Toronto-based RBC Dominion Securities Inc. (DS): “I’m starting to come around to it. When I find new business, the first thing clients have done is Google me. So, if you don’t have a presence on the Internet, people may not phone you.”

More flexibility is needed

Although many advisors’ attitudes toward social media are changing, some advisors do not feel their firms are being equally open-minded or flexible about using social media.

For example, advisors with Toronto-based TD Wealth Private Investment Advice’s (TD Wealth PIA) – who gave their firm a performance rating of 4.2 in the category, the lowest of any firm and a significant drop from 5.5 in 2015 – said that using social media is too difficult. In particular, TD Wealth PIA is in the midst of a pilot project in which only some advisors are allowed to post actively on LinkedIn and Twitter.

“It’s a tedious process to do these things. We can’t even login to LinkedIn on our own computers here [and for] Twitter, we have to have a ‘special licence’ from the firm,” says a TD Wealth PIA advisor in Ontario.

DS’ 5.5 performance rating is the second-lowest in the category, but a slight improvement from 5.3 in 2015. Some DS advisors acknowledged their firm’s efforts in this area, but many others said the firm’s social media policy is overly restrictive.

“We’re basically not allowed to do anything. LinkedIn is about it, and social media is the only way to market in this day and age,” says a DS advisor in Ontario.

The firm is in the middle of a pilot project that focuses on LinkedIn and should be completed in July.

Greater access pays off

LinkedIn currently is the only social network that DS advisors can use, but “long term, we’re laying the groundwork to enable advisors to take advantage of any social media platform that makes sense for our business while meeting our regulatory [requirements],” says David Agnew, who oversees DS in his role as CEO of Royal Bank of Canada’s wealth-management division.

Giving advisors greater access to social media does pay off. For example, Wood Gundy made LinkedIn available to advisors on a firmwide basis this past December – and some advisors also have access to Facebook and Twitter. As a result, advisors rewarded the firm with the Report Card’s biggest year-over-year increase to the rating in social media, to 6.7 from 4.5 in 2015.

“They just recently allowed us on LinkedIn. It’s been slower than we would have wished, but they’ve heard us,” says a Wood Gundy advisor in Alberta.

Accessibility also was a key factor for advisors with Toronto-based Raymond James Ltd., who gave their firm the highest performance rating in the category, at 8.4.

“I can post whatever I want once it’s through compliance. We have pre-approved material that I can post immediately. I can use Facebook, LinkedIn and Twitter,” says a Raymond James advisor in B.C.

The streamlined approval process and resources for taking advantage of social media help Raymond James’ advisors balance their online marketing efforts with the services they provide to clients, says Peter Kahnert, senior vice president of corporate communications and marketing with the firm.

“We don’t want [advisors] to spend all day thinking about their next great tweet,” he explains. “We want them to spend all day working with their clients and helping them.”

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