This appears to be the seminal question being asked by many advisors as it relates to social media marketing.  Too often the answer to the question is clouded by fears regarding the regulatory environment, but that should not be the influencing factor in deciding whether or not to embrace social media as part of your firm’s marketing efforts.  The regulatory guidelines related to social media are relatively clear and the technology required to monitor and archive social networking activities is proven and inexpensive.  The real question is quite simple; “What are my clients doing with social media?” 

While there are many benefits that can accrue to a firm as a result of social media marketing, a fundamental consideration should be its ability to enhance communications with current clients, nurture existing prospects and generate qualified leads.  To kick-off this effort, follow your clients on Twitter, connect with them on LinkedIn or friend them on Facebook.  Follow prospects that are of interest, whether they are institutional or individual investors.  Monitor their posts and exchanges to assess how they’re using these networking sites and what topics are of interest them.  Once you understand the extent to which your target audience is socially engaged determining how to chart a path forward should be relatively easy.

Adoption rates for social media continue to escalate across socio-economic and demographic segments, among B2C and B2B marketers and across geographical boundaries.  Consider that Facebook now has over 700 million users, Twitter over 200 million and LinkedIn over 100 million users.  Chances are very high that many of your high net worth and mass affluent clients and prospects are among the user base of the aforementioned social networking sites.

Consider these statistics from Spyder Trap Marketing:

• Among U.S. adults, 42% use social networking sites, among those 18 – 29 years old, the figure is 86%.
• Social media now reaches the majority of U.S. residents aged 12+ with 52% having a profile on one or more social networks.
• It took nearly 40 years for computers to become mainstream, it took Facebook less than 6 months to add 100MM people.
• 37% of internet users actively contribute to the creation of commentary or the dissemination of news.  75% of online news consumers get that news forwarded via email or posts on social networking sites.
• Sharing produces an estimated 10% of all internet traffic and 31% of referral traffic to sites from search and social.

Still wondering whether or not you should be utilizing social media?  Do you want to be a participant in the dialogue or risk being left out of the equation with a rapidly growing segment of the population?  If you would like to speak with Cliff Campeau, Partner of Evolutionize regarding the applicability of social media marketing for your firm contact him at cliffc@evolutionizemypractice.com.