Industry: Financial Services
http://www.investopedia.com/articles/professionals/061013/how-financial-advisors-are-leveraging-social-media.asp, http://www.business-standard.com/article/finance/insurance-sales-through-online-channels-to-grow-20-times-by-2020-study-114031800579_1.html, http://www.investorsgroup.com/en/media-room/media-releases/financial-decisions-influenced-by-bloggers-social-media-and-variety-of-websites, http://www.finance-investissement.com/nouvelles/industrie/distribution-en-ligne-reactions-mitigees/a/61360, http://www.limra.com/research/
The financial industry has always been more conservative than a lot of other industries, like fashion as an example. It is without any surprise that banks and most financial services companies have been late to adopt social media.
However, the new generation of customers have forced the industry to get more social as the communication channels to connect with the younger customers have quite evolved.
Researches have shown that customer are more and more looking on social networks for financial advice or information before taking a financial decision. Seeing this trend getting more and more important, the financial advisors and manufacturers had no choice to start using social media as part of their business strategy.
“Social media is changing the way clients think about products and services as well as how brands think about customer service. Now with online banking, people have access to their accounts 24/7 and with social media clients can contact their bank any time of the day or night.” says Tahnya Parachuk, CFP, Social Media Consultant at Manulife
Bringing value to the customer is taking another dimension with new technological tools that are disrupting the traditional distribution channels. Robo-advisors, Online insurance aggregator and online channels to buy insurance are examples of trends that financial professionals and organisations have to consider and respond to.
Robo-advisors are sometimes seen as a threat but most of the time advisors and manufacturers are seeing them as an opportunity to reach the new customers generation, e.g. the X and Y generations. There is no question that robo-advisors will impact the financial services supply chain from pricing to distribution and change how advisors do business going forward.
I think social media is one of the solutions for advisors and Financial organisations to make sure they stay connected with their customers and better understand their needs in this new environment where information and advice are so easily accessible.
Tahnya also mentions that “brands don’t only have to spend money on TV advertising hoping to reach viewers when they’re watching a specific channel at a specific time, they can also send out information on social media or post it on a website for clients to access at any time. The reach and availability of being online for social media has made brands accessible to their clients at all times and this helps build long term relationships because when you are comfortable reaching out to brands you trust them and when you trust them you use their service.”
This is also why organisation are now dedicating resources to support advisors as they’re getting more active on social media. This is only a brief snapshot of how product distribution and sales processes are impacted by social media and new technologies at this turning point in the financial industry.
Submitted by: Jessica Landry
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