As social media continues to take the world by storm, advisors are increasingly under pressure to begin using social media in their own practices. Yet the advisory community has generally been slow to adopt, due both to the compliance challenges involved and a general wariness about whether prospective clients would really make a decision to trust and work with an advisor based on social media marketing.

In fact, a recent study by the Aite Group suggested that "the bloom is off the rose" when it comes to advisors adopting social media to bring in new business. Yet at the same time, a new social media trend is emerging: using social media not to develop new clients, but to better communicate and interact with existing clients. The good news is that this approach to social media potentially has far fewer compliance headaches, too, because it's less about talking and more about listening.

The inspiration for today's blog post comes from a summary of results from the Aite Group's recent research on the benefits that advisors are reporting from their professional use of social media. As is evident from the chart to the left, and the Aite Group's own summary of the results, there has been a marked decrease in the benefits that advisors are reporting from their social media use: fewer prospects reached, less awareness generated, and a sharp decline in the perceived differentiation from the competition. In point of fact, this last shift—less differentiation for using social media as more advisors adopt it—may also go far to explain why advisors are reaching fewer new prospects and having more trouble generating awareness. Yet the striking part of the results to me is not just the categories that declined, but the one that saw a dramatic increase: "improved ability to communicate and interact with clients."