What’s holding you and your bank back from social media?
It is somewhat of a sticky subject but is worth addressing.
Industry experts reveal that the majority of purchasers of social media are B2B buyers. It’s also the preferred information source for the younger demographic, which many banks are looking to reach in an attempt to begin a relationship with a target group that will only become more profitable as they mature.
It is widely known that, among others such as Wells Fargo and American Express, Bank of the Southwest has been dabbling in social and new media in an attempt to target the 18-35 demographic.
“It connects to them and speaks to them,” says Josh Ragsdale, Head of Marketing for Bank of Southwest. He added that unlike his parent’s generation, “my generation doesn’t call customer service” but instead looks to places like the web.
Similarly, Bank of America has launched a small business banking community that has attracted more than 15,000 members. In this digital arena customers can chat with other entrepreneurs and business owners or just post useful articles. Alan Maginn, senior analyst for Corporate Insight points out, “the banks are learning from clients, but it also extends the brand.”
On top of this, Marcy Shinder, VP-brand strategy and marketing for American Express OPEN says, social media has given them much greater marketing efficiency during the economic downturn.
A social media site created by Amercian Express, called “OPENForum”, provides small businesses with the type of content and tools that can help grow their business. Obviously the silverlining for Marcy and her peers is that this initiative costs exponentially less than traditional media and provides more of a “pull than push” marketing strategy. A shrewd digital PR strategy indeed.
Furthermore, Amex has scaled back its TV advertising, although this shifting from expensive TV executions to digital and social media channels is not merely about cost but really about what people are responding to.
However, the unique challenge in finance is keeping everything safely corralled within the boundaries of compliance. That is why many more banks are “planning” a foray into social media, while few are even testing the waters. The informality and open exchanges inherent in this media are the very characteristics that can create compliance disasters that, unlike most other media channels, cannot be caught before the damage has been done.
Watch this space.