The Socially Savvy Advisor + Website: Compliant Social Media for the Financial Industry

Chapter 30How Do We Prevent Competitors from Poaching Our Clients on Social Media?

Knotty compliance issues can serve as a disincentive to financial advisors weighing their involvement with social media, but often there's another matter in the back of their minds that drives their discomfort with social media even deeper.

Over the years, I've had numerous conversations with advisors at brokerages and registered investment advisors (RIAs) who feared operating in an open social network where other advisors could connect with retail investors. The reason? “Other advisors might take my clients!” The open and networked quality of social platforms appeared in their minds as a double-edged sword—their ability to strengthen relationships with their customers meant that their competitors could do the same. They were even afraid of outside firms recruiting other advisors on their staff.

This concern, of course, ignores a glaring truth—poaching can happen anyway. Just as we've noted that customers who have bad things to say will find a way to say them—whether you're involved in their social media world or not—so too can your clients or staff jump ship if they so desire. What it all comes down to is this: Are you doing right by your customers? Because if you are, they won't want to go elsewhere. If you aren't, well then, yes, you may have something to worry about. And it should be more than just this new thing called social media getting you to focus on that issue.

Three Ways to Protect ...