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The Correlation Between Facebook with Clients and More Referrals

The advisors who are receiving more referrals are more connected to their clients on Facebook.

We’re in the process of wrapping up our 2017 Financial Advisor Research Project. Through this research, we typically uncover a number of gems and the following on Facebook is no exception. This study was focused primarily on word-of-mouth influence (WOMI), which was measured using a powerful metric: the number of referrals an advisor received in the past 12 months. 

We segmented the advisors into three groups: Generators with 10 plus referrals last year, Middlers with 3 to 9 and Laggards with 2 or fewer. Facebook was one of several activities that Generators used more heavily than Middlers or Laggards.

Data Highlights

  • 60 percent of Middlers and 54 percent of Generators sometimes or frequently connect with clients on their personal Facebook account.
  • 46 percent of Laggards never connect with clients on Facebook.

Interpreting the Data

This is a common "chicken or egg" complex. Do Generators and Middlers already have deep personal connections with clients so they feel comfortable connecting with them on Facebook? Or, do Generators and Middlers proactively deepen these relationships using Facebook as an accelerator? Based on the findings within the report, we would assume the latter. Our research uncovered that Generators and Middlers took a proactive approach to generating WOMI. The advisors who are receiving more referrals are more connected to their clients on Facebook, and this number is rising yearly.

The Benefits of Being Facebook Friends

Many affluent clients use Facebook and connecting with them provides their financial advisor with a window into their personal life. Used properly, this is a form of social media that can activate digital WOMI. How? By interacting with clients, commenting on photos, sharing photos, and using it as another tool for staying top-of-mind. It also deepens the emotional connection you have with clients by letting them into your personal life. It appears that Generators and Middlers understand this more so than Laggards, but all advisor segments would benefit from connecting with top clients on Facebook more frequently. With 1.86 billion monthly active users, Facebook is simply too big to ignore.

@StephenBoswell is President of The Oechsli Institute and author of Best Practices of Elite Advisors@KevinANichols is the Chief Operating Officer for The Oechsli Institute and author of The Indispensable LinkedIn Sales Guide for Financial Advisors.

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