by tom
13. May 2011 17:07
How is social media having a substantive impact on banking? It provides direct access to customers in a number of ways that can improve customer service, and create a degree of intimacy with customers that they haven’t had before. With customers more reluctant to venture to their local bank branch and instead turning to the web and their smartphone to do their banking, banks are finding social media outlets are a good way to approach customer interaction in a positive way, without relying on the in-branch experience.
Oddly enough, however, most banks are still reluctant to embrace social media. According to a recent report by Ovum, two-thirds of the world’s retail banks have no plans to use social media. Currently only 6 percent of retail banks deal with customer questions, and only 1 percent plan to add social media customer support in the next year. And 14 percent are using social media for marketing, while another 12 percent plan to add a social media marketing plan by the end of 2012.
Those banks not planning to embrace social media will lose competitive ground. According to Ovum analyst Martha Bennett:
“We feel that this attitude from retail banks towards social media is a major issue in an era of aggressive competition. The banks without a social media strategy are being shortsighted and are placing themselves in a dangerous and vulnerable position compared to competitors who have realized that social media can and must play an intrinsic role in their business.”
There are any number of ways that banks can leverage social media to interact directly with customers. Here are four that we are already seeing:
- Twitter for support. Bank of America (@BofA_Help) and Wells Fargo (@Ask_WellsFargo) are just two of the banks using Twitter to help customers with quick responses to questions. If a customer has a question about checking, savings, or online banking, they can post a tweet and get a quick response. Chase and other banks are tweeting as well, including information about special rates, loans, and other information for customers.
- Market and rate information online. Financial news is everywhere. Twitter feeds are being maintained by the Walls Street Journal (@WSJPersFinance), Yahoo! (@YahooFinance), Associated Press (@APPersonalFin ), and other news organizations. And companies like ours blog about rate information and post insights to Twitter and Facebook. There is a wealth of banking information available if you know where to look.
- Providing a customer face on Facebook. Facebook is a great place to keep customers up to date on community affairs, banking specials, and other activities. It also provides an interesting extension to customer support. Consider what would happen if your banker were reviewing loan options while checking out your Facebook page: “I see you have a child in college. Have you considered…..” or “We have a new credit card that offers travel miles that might be useful for visiting your college student.” (Something to ponder when you check your privacy settings.)
Despite having to navigate new FINRA regulations and other concerns about data leakage and losing control of your online brand (see the Bank of America Sucks page on Facebook), the benefits of joining the social media conversation to connect with customers and build loyalty far outweigh the risks. As Ovum analyst Bennett says in her report:
“Consumers are not averse to receiving promotional messages via social media, or using it for customer service enquiries so a massive opportunity to rebuild the confidence in the sector that is so desperately needed is being ignored.”
To help you keep track of the latest in banking social media strategies, Market Rates Insight has added a new feature to our Product Builder database in MyRI, our Web rate research portal. We have been tracking various social media campaigns for banks and credit unions as part of ProductBuilder Alert, so MyRI subscribers can search for social media programs to see how their competitors are leveraging Facebook, Twitter, LinkedIn, and YouTube. You also can track trends in social media marketing by signing up for our free ProductBuilder Alert, which is issued at the start of each week.
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