Banks and Social Media
Banks that are using social media to brand themselves or to market a specific product or service have found success by integrating social tools into their existing campaigns or creating new ones that capitalize on the spirit of the community. Whether it’s by making the bank synonymous with solid financial advice or giving people the power to do some good in the world, banks have been finding that immersive marketing techniques using social media tools have brought solid results.
Higher rate of Customer Advocacy
Forrester’s 2010 Customer Advocacy rankings report, ranks nearly 50 financial services firms in the United States by the percentage customers who agree with the statement: “My financial provider does what’s best for me, not just its own bottom line.” Credit unions ranked much higher than the big banks, as they have in previous years, with 70 percent of credit union customers saying their financial institution puts their interests first. Whereas the bottom seven of this year’s rankings included Bank of America, Chase, Capital One, TD/Commerce, Fifth Third, Citibank, and in last place, HSBC. These bottom seven rated between 16 and 33 percent.
*Forester 2010 Customer Advocacy Report
Creating a community
Community building fits right in with the mission of most community banks. The most important touch points in a customer’s life range from attending college, buying their first car, building a home, to starting a business and saving for retirement — all of which involve a relationship with a bank.
Giving back to the community: Rally customers around a cause
For each “fan” that joints the bank’s profile page, the bank will donate $1 to a particular cause. It also encourages consumers to invite others in their social networks in order to maximize the cause they are supporting. The campaign would originally start from the bank with an email message to consumers , or via statement messages or stuffers. Naturally, the bank has legal considerations to ensure that the proceeds paid not only benefit the bank for a marketing perspective but also from a regulatory perspective. Success is determined by the quality of the conversations taking place, but not the number of fans or friends.
Create a dialogue with and among your customers. Create a group for mortgagees who want to talk to each other about the economy in the housing market and how it is affecting them.
For banks that are more active in engaging with their customers over social media channels about their products, real-time search can be helpful in addressing problems with customers. In other cases, a visible Twitter (Twitter) account can be a quick and easy first step in the customer service chain when people want to get specific information.
Bank of America sees many of the same questions on Twitter that they get on typical channels like via telephone or in person, according to David Knapp, who runs the bank’s Twitter account, but they are starting to see social spaces as a potential channel of choice for customers to get the information they need. However, because of the sensitive nature of banking and the openness of social media, customers need to be careful when sharing information with customer service reps on social channels. On Twitter, Knapp regularly takes conversations private using direct messages and from there to more secure communications channels to gather sensitive details.
This can also be a great way to addresss bank mergers.
Marketing & Promotion
Launching new products — Look at their customer’s needs and use that to build new products and services.
Promoting events – small business workshops or other events can be posted on social media sites. Post community events.
The current financial crisis has led many customers to distrust banks, which is one reason why many banks are now turning to social media as a way to become more transparent to customers and build trust.
Keep customers up to date on bank information. Educate your customers on new products, services and banking regulations.
Some Success Stories
1st Mariner Bank, MD
The bank was able to use social communications tools and online surveys to develop a financial life cycle for their customers and identify that many people today establish a long lasting relationship with a bank in their late teens. They also found that parents are a major influence in the decision of which bank people ultimately decide to use. At the time, they didn’t have an attractive account to market to both parents and 18-25 year olds. With more research using social tools, they identified which features and benefits were important and which combination would give them a competitive edge.
Keystone Community Bank, MI
Some community banks such as Keystone Community Banks have increased deposits 27 percent over the past five years.
Provident Bank, NY
Provident Bank in NY has performed exceptionally well over the worst years of the financial crisis with 16 percent growth in 2008 and 4 percent growth in 2009. Compared with the negative growth in deposits from mainstream financial service providers, this sort of growth is exceptional. To be fair, there are some community banks that have suffered due to loan exposures established in 2004-2006, and a fair number of community banks that have failed, but comparatively as a group they appear to be performing robustly against mainstream financial institutions.
The Community Banker’s Guide to Social Network Marketing. It is available for free download at http://www.tinyurl.com/cbgsnm