About two months ago I wrote an article called “Investors move away from advisors to become more Social” which focused on a Harris Interactive survey which was produced on ING’s behalf in the US which highlighted the fact that 45% of investors had either eliminated or reduced their use of a financial advisor, with a growing preference to the internet and use of blogs.
Another financial research firm and consultant, Spectrem, has just recently released a survey of 500 financial decision-makers in households (USD$50,000+ in annual income) who spend at least two hours a week on the internet. The results of their findings have been released in a report titled “HIGH PERCENTAGE OF INVESTORS OF ALL AGES USE THEIR SOCIAL MEDIA NETWORKS AS SOURCE OF INVESTMENT AND FINANCIAL INFORMATION“
Basically the report cites that Social media networks have become an important stop for investment information for all age groups. Key points include;
- 77% of investors who read blogs are likely to consult them for information on new financial products and services
- 69% of LinkedIn users are likely to consult their LinkedIn networks on investment issues; and
- 63% of Twitter users would pay attention to investment tweets.
- 46% of YouTube users and 41% of Facebook users would seek investment information from these forums.
Again, and I can’t make this point strong enough, but on the back of this report as well as the Harris Interactive finds it is clear that Social networks are going to play a very important role for the retail investor for developing new investment strategies and seeking buy/sell advice.
And it bears a heavy impact on financial advisors as well! More than one-third (36%) of investors say they are interested in receiving information from their advisors or corresponding with them via social networks. Address this question to investors under age 35 and this rises to 53%.
The last 15 years of working in the financial services industry in Australia has taught me one very important lesson – you have to be able to network regardless of whether you an advisor, or a sales manager, or a product developer.
Social media is an extension of this networking and we, as an industry have to understand how we can use Linkedin, Facebook and Twitter if we are to keep up with these communication tools. This is especially critical when you consider that Social Networking has surpassed email when it comes to using the Internet.
