A sobering and powerful post on the power of social media for financial services. [hat tip mmpartee]
Such advice is interesting. At first glance one might ask whether it is serious. On the other hand would this not at least make a person sit up and take note. And what if others chimed in and the average response was that the advice was correct?
If we consider the development of Linux, where people participate and improve the system because they want to. Such selfless assistance is natural and a proven model.
Cogent Thoughts » Blog Archive » Social Media vs. Advisors (round 1)
A complete stranger whom I’ve never met told me the other day that my retirement plan was not appropriate for my investment objectives. I met this “stranger” on wesabe.com, a site that describes itself as:
“An online community of real people just like you, with real financial goals and concerns.”
Bankwatch 
(from the author) This is one of the more interesting findings from Cogent’s research on social media’s impact on personal finance and investing. In addition, >60% of affluent investors told us that they have CHANGED investments (i.e., increased or decreased investment in product or with company) as a result of something they saw, heard, or read on social media. Check out more comprehensive post here:
http://blog.cogentresearch.com/the-five-reasons-financial-services-firms-need-a-social-media-strategy/
Thanks Eric … that kind of stat is the right kind to make the business connection between social media and actually conducting business. But we need more … I know lots of people using social media, and the demographic shifts support and all, however the desire to conduct business using social media rather than traditional face to face in a branch remains weak.
No argument there…nonetheless, a central issue for wealth management is simply acknowledging the channel. Since conducting the research, I’ve found that the mere volume of investors using social media is fascinating to many brokerages (full serve & direct alike). The goal of the research was to really get a lay of the land and provide a cross-section of what investors are doing online and the role of social media in the decision-making process. Of course, for this industry, compliance, etc. is more of an obstacle than in, say, retail or travel. Therefore, the first step is not always to engage, but rather to notice. Thoughts?
I’m interested to see when the first major bank will add social features, such as discussions between customers about investment strategies. They seem to monitor what happens in the startup space and copy the features that work. For example, Bank of America introduced account aggregation, probably inspired by mint.com and other startups.