The Impact of the Online News Act Could Be Felt in the Financial Sector

With the blocking of news happening on Meta, it seems that the impact has extended to the financial sector.

Last month, I noted that the RCMP have started shifting focus towards social media. It was noteworthy because the RCMP and traditional media have been a classic partnership for a long time. If the RCMP is looking for a criminal, for instance, the media was the go-to place to reach the public.

Of course, the major problem is that the media is having an increasingly diminished role as the source people turn to for information. People’s attention has been increasingly split between the traditional media outlets and social media for some time.

The attention shifting away from traditional media outlets was accelerated thanks to Meta blocking news links with Google expected to follow suit sometime in the future. The impacts were highly predictable. Facebook’s traffic remains unaffected with the news links blocking while traffic to the traditional media collapsed. It proved the point that publishers need platforms more than platforms need publishers.

Indeed, if you had a choice between Facebook and Google in terms of reaching audience, Google typically wins, hands down. As a result, whenever Google decides to drop news links on their services, the impact will no doubt be greater for a large portion of the traditional news sector.

All of this leads to one question for many players affected by this: how does one reach an audience? One such sector that is faced with this is the financial sector. You might think that the financial sector isn’t exactly public facing. After all, stock traders are going to continue to trade stocks and business accountants are going to continue to do their thing. There are, however, elements of the financial sector that is very much public facing: your standard financial advisor.

Indeed, a number of such financial advisors are regularly reminding people of when deadlines for things like RRSPs are or making their presence known when it comes to helping people figure out when it’s a good time to invest or when to pull money out of investments. Some might rely on news articles to get their messages across. The problem is that people are still using things like social media while the traditional media is in the process of getting kicked out of that internet space. What do you do at that point? Do you continue to double down on traditional media messaging or do you make the leap into social media? It seems that, for some, the advice is to up that social media game. From Wealth Professional:

Not every advisor will be impacted by Canada’s recent decision requiring large tech companies to pay for news posted or shared on their platforms. But those that are will now have to make tough choices about how to engage clients on social media, according to one industry leader.

“As much as we say that advisors use social media, I think many of them are still very old school,” says Maria Flores, president of Carte Wealth Management. “Out of the population of advisors, I would say between 20% to 30% may be affected by the Online News Act.”

For the minority of advisors who’ll be impacted, Flores says it’s more important than ever to be deliberate about using social media. Rather than making impulsive decisions about whether to post or share something to get their target client base’s attention, she says they will have to develop an actual game plan.

“I think advisors have to rethink their strategy, and how they’re going to continue being engaged with their clients,” says Maria Flores, president at Carte Wealth Management. “And social media, honestly, is not an easy strategy.”

When it comes to social media marketing, Flores recommends for advisors to be consistent and plan at least six months in advance. That includes considering the types of posts they’ll be doing, the audience they want to target, and any national marketing plan for social media their firms may have in place.

Advisors can be strategic by considering seasonal events in planning calendars – deadlines for tax filing, TFSA and RRSP contributions, and RESP grant applications, for example – and building their content around those.

Seeing reactions in different sector to the implosion happening with the Online News Act is quite interesting. For the handful of vocal supporters of the legislation, the hope was that everyone would be sticking with wherever the media ends up. The thinking is pure fantasy because the habits of people today is increasingly revolving around social media. The large media companies have made their choice and will get to sit the era of social media out. This as the rest of the world moves on, leaving those outlets increasingly behind.

If the traditional media were well and truly the de facto standard of reaching an audience, you would see third party entities focus in on how to maximize their impact on traditional media outlets such as broadcast, newspapers, or radio. That is clearly not happening here. The increasingly prominent question is how to maximize the use of social media because that’s where the audiences are the most. Keep in mind, these third parties don’t traditionally follow the world of digital rights and technology. Yet, they recognize that they are going to be impacted by this and are forced to assess the situation anyway. The answer is increasingly to double down on social media and shift their focus away from the use of traditional media.

As more third parties assess the situation, they’ll probably look at what other sectors as guidance on how to respond. As more come to the conclusion that social media and the internet is the way to go, the traditional media will be increasingly hard pressed to justify their presence. Without an audience, the traditional media are little more than a relic of the past. As focus continues to shift further away from the traditional media outlets, it’ll become increasingly difficult to find a reason to reach people through those mediums. As a result, it becomes a vicious circle for the traditional media outlets.

Drew Wilson on Twitter: @icecube85 and Facebook.

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