In Touch

Art by Brian Scagnelli

When it comes to having a presence on social media, Brent Sheppard, a partner and financial adviser with Cadence Financial Management in Moorestown, New Jersey, has two preferences for business purposes. Predominantly, he uses LinkedIn, he says, and, in a more limited way, Twitter for information gathering—not for writing to clients or prospects. He shies away from Facebook as a business tool “for a variety of reasons,” including the platform’s informality.

Putnam Investments’ Social Advisor Study shows that 72% of advisers use LinkedIn—making it by far the most popular social media platform for advisory business purposes, though the use of Facebook is now at 62%, a 40-percentage-point increase since 2013. Meanwhile, Twitter use has increased from 16% of advisers to 52% over that seven-year period.

Best Use Case

“The best use case for us is simply using social media to follow clients and prospective clients,” Sheppard says. “It’s helpful to see, for example, when they are doing a fundraiser or perhaps a big social event for their workforce. We can bring that information into meetings and make a more genuine, personal connection. Otherwise, a quarter goes by pretty fast, and if we just talk retirement and nothing else, the relationship can grow stale.”

Atlanta Retirement Partners LLC, a financial services firm headquartered in Atlanta, heavily relies on LinkedIn for research, whether it is seeking background details on prospective clients, deciphering who has decisionmaking authority when it comes to potential workers, or looking into who may have a working relationship with a potential customer, says David Griffin, founder of the firm.

“We do almost everything through LinkedIn; it’s the easiest way to target those people who are decisionmakers for institutional-type plans,” he notes. “We find that this preparation strengthens your relationship with your prospects and customers. You can talk about things that are important to them or their business.”

Sheppard says his use of social media started out casually, but over time it has become a more formal and concentrated effort, leading to his firm’s current use of LinkedIn’s paid sales support resources.

“We were actually hesitant at first about whether taking that extra step and using the paid resources would be worthwhile,” Sheppard says. “In fact, LinkedIn’s sales platform has proven to be an unbelievable tool.”

Specifically, LinkedIn’s paid solutions help Cadence “dig into prospective clients and get a pulse on their decisionmakers and more,” Sheppard says. “You can go only so far on a client’s website toward understanding who is the leadership of a given company—who is making the big benefit decisions.”

Griffin and Sheppard agree that, with some clients, social networking platforms exceed the efficacy of email messaging, which can at times feel like noise due to oversaturation.

“As you work on your social media outreach, you will often find you have a second- or third-level connection with any given prospective client,” Sheppard observes. “When I see that we have mutual connections, I don’t hesitate to pick up the phone and ask our existing clients for more information or even to make a connection. People are happy to do this.”

Building Connections

David Kulchar, managing director, retirement plan services, with Oswald Financial, in Cleveland, emphasizes the importance of networking—not only with existing and prospective clients but also with peers, service provider partners and even competitors. To this end, his firm has built a dynamic database of cross-referenced centers of influence in the firm’s geography.

“Over time, we get to know every service provider partner our clients have, and we populate a customized database accordingly, built on RedTail technology,” Kulchar says. “We have built the system so that we can dig in and cross-reference these centers of influence, to get a really clear picture of who in the network knows each other and in what capacities. For advisers thinking about growing their referrals, that’s where I would start, with a database.”

Kulchar also notes how his firm works with many nonprofit clients. He has found it useful to get to know their boards of directors, and to establish a rapport with entities such as the Better Business Bureau. The effects of such networking are cumulative and subtle, becoming powerful over time.

Indeed, Sheppard says social media connections rarely lead to immediate investment from new clients, but that misses the point.

“Off the top of my head, I can’t pinpoint whether a single specific connection from a referral through LinkedIn resulted in a direct sale,” Sheppard says. “Making social media connections is more about building your understanding of the network and cultivating relationships. From there, once you become known to a potential client, you then have the chance to enter into the whole sales pipeline. Right now, I can think of 10 prospective clients we’ve been getting to know over several years where LinkedIn absolutely helped to drive that initial contact.”

He adds that this social media network is partly why his firm can thrive without having to do the kind of blind, cold call outreach that was once common in this industry. “We don’t have a young adviser making cold calls,” he says. “Those days are well behind us. We don’t use any sort of lead services or call people to scare them about plan compliance. That doesn’t get you anywhere in 2020. We gain our new clients through warm referrals, and many of these involve making digital connections.”