Wealth managers apply social media analytics to stay close to customers and stay ahead of risks

Social media analytics help wealth managers stay ahead

Social media offers ways for wealth managers to better understand customers and risks.



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Social media is creating both opportunities and risks for wealth managers and we believe the positives outweigh the negatives, particularly if wealth management firms use the channel to advance client conversations and learn to apply social media risk management. 

Time to embrace wealth management social media

While there is much evidence of wealth growing exponentially on a global scale, the conservative nature of the wealth management industry makes it slow to address lurking reputational vulnerabilities 
and embrace the new level of communications and social media risk management required today.

The disruptive nature of social media is helping to evolve client expectations on how they receive information and interact with wealth managers. Clients already embrace social media in their daily lives and the industry must shift focus to social media to take better control of its reputation – or else risk disintermediation. 

Wealth managers must also come to a new understanding about who is responsible for handling social media risk. Social media  is not strictly a function of marketing but must also involve the chief risk officer and head of public affairs.  Many wealth managers are still in the early stages of social media planning, despite the urgent need to more quickly get up to speed. 

Social media analytics

It is always helpful to understand which way the wind is blowing within the wealth management industry, and social media analytics provide deep insights, and are vital tools for handling risk.

In the context of social media, ‘sentiment’ has become both measurable and meaningful (and potentially profitable). In wealth management, social media analytics help uncover customer attitudes from a range of online sources and can put your social media data to work for you to better understand your markets, manage your brand and improve the experience of your clients.

Social media activism

A rise in social media activism is adding pressure on investment funds, particularly when it comes to the areas in which they invest.  In the world 
of wealth management, social media activists target clients to help dissuade investment in what they perceive as immoral or unethical assets, or encourage investments in more ‘virtuous’ funds. In these cases, ‘word 
of mouth’ can drastically hinder wealth management fund success. 

social media strategies for wealth managers

To turn social media into effective tools to build competitive advantage:

  • Get with it. Social media is here to stay. 

  • Embrace it. Get to understand your organization’s social media footprint. Commission an audit or review.
  • Understand it. Use social media to bring customers into your community, and listen to what they have to say. 

  • Focus on it. Pay attention, request reports on social media activity to be shared across the organization, not just in marketing. 

  • Take it all in. Don’t ignore your weaknesses. Your head of risk, CFO and audit committee chair should be in on the good, the bad and the ugly. Be prepared to manage crises. 

  • Have a POV or two. Compete on your own terms. Your points of view and points of differentiation can help create value for your customers, investors and distributors, and ultimately manage downside risks.
  • Don’t be afraid. This is too important to let fear get in the way. Respect what your users are saying. Think about the short- and long-term effects.

Clearly, social media is a disruptive technology in the wealth management industry with the potential to keep connected firms one step ahead of nascent trends. By building a team of executives who understand social media, accompanied by a systemic shift
 in attitudes toward this channel, smart firms will gain strategic advantage over less tech-capable competitors. 

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