Putnam Investments study finds extremely broad–based and increasingly sophisticated use of social media by financial advisors

BOSTON, October 13, 2016 — In one of the largest known surveys of financial advisors — over 1,000 professionals nationwide — on the use of social media in their business practices, the Putnam Investments 2016 Social Advisor Study found that 85% of advisors — up from 75% in 2014 — are actively using social media in their day-to-day work, and they continue to become more sophisticated in their use of multiple social networking platforms for business.

In addition, the study found that advisors gaining new clients via social media has grown from 49% in 2013 to 80% in 2016. Further, 85% of advisors agree that social media has shortened the time to close, compared with traditional approaches.

“The use of social media by the financial advisor community has matured to a level where it is ingrained in how business is conducted and how professionals communicate with their clients and prospects,” said William T. Connolly, Co-Head of Global Distribution, Putnam Investments. “In our ongoing dialogue with financial professionals, it is eminently clear that social media’s role as a critical conduit for advisors in reaching the marketplace is going to continue to deepen and evolve for the foreseeable future.

Connolly indicated that Putnam first embarked on what has become an annual research initiative several years ago in order to provide deep insight to advisors nationwide — at wirehouses, independent broker-dealers, banks, insurance companies and RIA firms — on the increasing importance of social media to their business practice and ultimately to better serving existing and prospective clients.

In further discussing the 2016 study, Mark McKenna, Head of Global Marketing, Putnam Investments said, “Our research indicates that not only are a huge swath of advisors using social media in their practices today, they are actively combining their professional and personal presence on multiple platforms to further develop and strengthen their client relationships.”

McKenna pointed to the continued growth of the more personally-focused Facebook platform which is being accessed by advisors in their ongoing work with clients. Facebook’s usage for business among advisors has risen from 36% in 2014 to 54% today, while usage of LinkedIn for business has grown from 64% in 2014 to 73% this year.

Other Critical Findings
The study yielded other notable insights for advisors using social media for business, including:

  • 80% of advisors using social media say it helped them gain new clients
  • The median AUM (or asset) gain through social media is $1.9M, with the average gain at $4.9M
  • 56% of advisors report that social media has improved their efficiency a great deal
  • For advisors with AUM of $100M or more, 35% report that social media plays a very significant role in their marketing efforts and 82% have used social
  • media to gain clients, with a median gain of $4.7M and an average gain of $8.3M

Attributes of a “Social Advisor”
The Putnam Investments research reveals the following profile of the typical financial advisor gaining assets through social media:

  • 43 year-old advisor working at an independent broker-dealer
  • Has 10 years of experience
  • Runs a book of business of $92 million (median)
  • Active on social media networks daily

About the Survey
The research, conducted online in conjunction with Brightwork Partners LLC, included 1,018 financial advisors nationally who have been advising retail clients for at least two years. The study was conducted in July 2016. The results of the survey can be found at putnam.com/advisorsAREsocial.

About Brightwork Partners LLC
Brightwork Partners is a specialty research and consulting firm focusing on distribution strategies for retail asset managers and providers of defined contribution services. Founded in 1999, the firm conducts custom and multi-client research among advisors, consultants, plan sponsors, third party administrators and participants on behalf of major providers in the industry.