The general session hall at Schwab Impact, the firm's annual event for its RIA clients, was packed this morning to hear a Facebook co-founder and a Twitter founder talk about the future of social media. But few advisors raised their hands to indicate they would be using social media soon for their practices.
Futurist Gerd Leonhard presented first: "Engage or die," he said of social media. The old way of "shouting" your brand to the world is dead. Open platforms, self-publishing, following, talking back . . . that's the wave of the future, he said. "It's not about kids," this social media stuff. With smart phones, in the near future, he said, "Everyone will be on social media."
The financial advisor attendees at Schwab Impact, this year held in Boston through tomorrow, were not buying it. When asked if they used social media in their practices, few of the thousand or more attendees (hard to tell how many of the 3,000 or so attendees were there, but it was a giant ballroom and filled) raised their hands. Even fewer (a dozen?) raised their hands to indicate they intended to use social media in the near future.
Biz Stone, a founder of Twitter, advised advisors to "take it slow." He said, "You don't have to tweet right away, you can follow . . . observe conversations." Use the search function, he said, to find out what people are saying about a trend, a product or a company.
Chris Hughes, a co-founder of Facebook, agreed. He also said advisors should regard social media as "user-generated reviews" of financial products, trends and firms. (Hughes said that the new movie about the founding of Facebook had more "sex, drugs and rock n roll" than was really there at the time. He said it was Hollywood being Hollywood. And that he was frustrated somewhat by the film's depiction of the founding of Facebook. He said for a more accurate look, read The Facebook Effect by David Kirkpactrick.)
Patrick Powers, president of Powers Capital Investments in Anaheim Hills, Clif., an RIA, says compliance issues "throws a wet blanket" on social media, such as Facebook or Twitter. "Is Tweeting marketing? If it is, it's a big compliance issue. You can't talk about performance, you can't talk about what the markets did yesterday unless you get very specific and couch everything very carefully. And our compliance guys don't like it." He says he has no plans to use social media.