Social Media and BankingBanker Resource
September 16, 2013 — 1,200 views
Around five years ago, banks started using social media so as to embrace the most popular tool of the times. They've used it for promotions, but the main focus is community building where a bank can share its mission and history and keep a conversation going with their stakeholders. Consumers are increasingly using social media platforms to choose banking services.
Building a Community
Many banks like Citi and ING direct use Twitter and Facebook regularly to interact with their customers. Banks usually exude a detached and formal feel. But they are involved in many important decisions of an individual’s life. This is why community building is a necessity for banks.
Although the risks of negative posts from consumers is high, the advantages are many. Social media can prove to be a great listening tool for the banks where they know the customer’s preferences and needs. Something negative can be dealt with before it escalates. It also provides a bigger database about the customers, since a lot of personal information is shared on networking sites. Facebook's new graph search can especially turn out to be quite handy. This can be used to make the content more current. A lot of banks also use social media as a forum for rewards and loyalty points which are popular with the members.
Extended Customer Service
Social media banking garners a huge platform for two way communication. Customers want quicker answers to their queries and social media lets banks handle complaints quicker and more efficiently. Some customers might be wary of using this extended customer service as it involves a lot of personal information. Banks like Citi have found a way around it where a query is responded to directly through a message. It is then carried further by a phone call if necessary. Social media banking also helps in adhering to regulatory compliance as transparency with customers is made easier.
Today's generation is fast paced and would rather turn to their peers through digital channels for help. So, using this channel of customer service proves to be more popular. Although banks have to be careful with how they handle enquiries with sensitive information involved.
Marketing and Product Research
Social media provides a large ground for research and development. People share preferences more readily and these can be used to develop the right schemes for the right audience. Online surveys and other tools provide insight into what products the market needs at the moment. Since networking sites have a lot of personal demographics, it can help banks see what influences people to make banking decisions.
This also lets banks access the interests of customers can be used to market relevant products and offers. Advertising on social media proves to be much cheaper while having a large reach. Banks that have combined social media tools with marketing techniques have been observed to have a lot of success. Sharing ideas and vital information can also create customer value. Creating contests or supporting causes by mainly using crowdsourcing can greatly increase a bank's brand value.