Investors turning to social media for financial advice is increasingly common, particularly among Millennials, but most still look to their advisor’s website first for information they can trust, according to Spectrem Group’s newest research study, Using Social Media and Mobile Technology in Financial Decisions.
While this once may have occurred primarily on a desktop or laptop computer, the vast majority of investors now use smartphones to read articles and blogs, watch videos and learn about new investment products and services, underscoring the need for advisors to cater to these mobile preferences.
The report also examines the frequency with which affluent investors use social media, the platforms they prefer, how they use their smartphone or tablet for investing purposes and where on the internet they go to find financial information, among other topics.
Two-thirds of Mass Affluent investors (those with a net worth under USD1 million) who use Facebook check it at least once a day, with 44 percent checking it at least twice a day. More than half of Twitter and Instagram users check those sites at least once a day. If advisors want to get messages out to investors, social media works, since users try to connect with their advisors, especially on Facebook, Twitter and LinkedIn.
Among Millionaire investors (with a net worth between USD1 million and USD5 million), 32 percent watch videos on financial topics, and that climbs to 58 percent of Millennial Millionaires. Younger investors are looking for videos on stock tips or investment products while older Millionaires are looking for videos on current financial events such as stock market updates or economic news.
Those Ultra High Net Worth investors (with a net worth between USD5 million and USD25 million) who want to communicate with their advisor do so in a variety of ways. Thirty-six percent of UHNW investors under the age of 53 have texted their advisor and 20 percent have communicated with their advisor via Twitter. The interest in being able to text an advisor is growing, even among the oldest investors.
“There is no ‘right way’ to communicate with investors any longer; advisors must be available and active on social media, their website and via mobile technology,” said Spectrem President George H Walper, Jr. “Investors are on their smartphones and tablets all day long. More of them are working and communicating with those devices than with their desktop computers. When they want to communicate, they want to do so by texting. When they want information, they want to get it on your website. But if you are trying to get a message out, the best way to do so is through social media posts. Ignore a modern communication path and you could end up ignoring a current or future client.”