Social Media in Financial Services: Building a Winning Strategy


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Social Media in Financial Services: Building a Winning Strategy

  1. 1. Social Media in Financial Services: Building a Winning StrategyReport Details:Published:October 2012No. of Pages: 58Price: Single User License – US$3450Early pioneers have demonstrated the enormous benefits that can be gleaned from using socialmedia to the rest of the financial services industry. Providers are becoming increasinglysophisticated in their utilization of social media. It is changing the way providers interact with theircustomers, impacting every area of the customer experience from marketing to customer serviceto brand building.Features and benefits•Discover how to make the most of the opportunities offered by social media.•Sculpt future strategies by harnessing lessons from best practice examples.•Understand how your organization can be internally structured to use social media.•Prepare today for the challenges social media will bring tomorrow.•Keep ahead of the curve by learning how your competitors are using social media.HighlightsBuilding an effective operational structure of social media within the organization is necessary toharness the benefits of social media. Consumer use of social media within financial service isgrowing quickly which means that providers must build sustainable, scalable social programs.Social media big data analytics offers a rich source of insight into customers which providersutilize to deliver more targeted marketing which has a higher chance of leading to up-selling,cross-selling, and new customer acquisition. It can also be used to locate dissatisfied customersand proactively address their concerns.Crowdsourcing, customer reviews, and interaction between providers and customers on socialmedia offer a means to be open, inclusive, and customer-centric. Social media shows customersthat the provider is listening and responding to what they are saying. This helps to restoreconsumer confidence that has recently been lost in providers.Your key questions answered•How can providers seize the opportunities in using social media in their marketing, customer service, product innovation, and brand building?•What changes need to be made to social media operations within your organization?•What is the untapped potential of social media in financial services?•Which providers are being innovative and pioneering the use of social media in financial services?
  2. 2. •What is the future of social media use in financial services?Get your copy of this report @ points covered in Table of Contents of this report includeTable of ContentsOVERVIEWCatalystSummaryMethodologyINTRODUCTIONThe use of social media continues to grow as consumer appetite shows no sign of slowingThere is growing acceptance of the importance of social media among providersMost financial services providers have not utilized social media to its full potentialThe use of social media has become more sophisticatedSocial media makes marketing more effective through better targetingImproved customer service is delivered by responding to consumer needsCrowdsourcing and customer feedback drive innovation and build trustProviders increase brand value by engaging with customersProviders should choose an internal social media model that suits their objectivesSTRATEGIC CONTEXTSocial media makes marketing more effectiveMarketers use social media to reach more customersEngaging marketing content is essential to attract consumer attentionProviders use customers social media profiles for smarter marketingSocial media raises the profile of low visibility servicesEffective marketing generates leads for acquiring new customersSocial media delivers better customer serviceSocial media amplifies the benefits of customer serviceSocial media is a convenient channel through which to offer customer serviceCustomer service issues are resolved before they become complaintsSocial media anticipates future customer service issuesSocial media improves customer service as an effective crisis management toolSocial media informs and educates customersCrowdsourcing and customer feedback fosters innovation and increases transparencyCustomer-generated ideas cultivate innovation and strengthen the provider-customer relationshipCustomer involvement increases the transparency of servicesConsumer-generated reviews increase consumer trust in the providerSocial media builds brand value through greater engagementProviders engage customers with their brand by demonstrating individuality
  3. 3. Social media interaction engages hard to reach customersProviders tailor their brand identity to target a specific audienceBrand value is increased by engaging the local communityProviders boost brand value by engaging in non-financial services campaignsSTRATEGY IN FOCUSProviders must first build an effective internal social media structureMarket trends prompt providers to start using social mediaProviders have a choice of a number of different internal structuring modelsFinancial services providers tend to favor the Centralized model because it maintains controlCommitted providers need to adopt the Hub and Spoke model in order to scale their social effortsA Multiple Hub and Spoke model is necessary for large multinational providersProviders should choose the model that best suits their social media objectivesProviders will face a number of obstacles in implementing a social media programChanging between internal models brings challengesProviders will use social media for smarter marketingProviders will use big data analysis for improved targeted marketingProviders need to consider that some consumers will dislike big data-based marketingGeolocation-based marketing will become more prevalentMarketers will target customers with high levels of social connectionsMarketing emphasis will shift from “push” to “pull”Marketing will have to cut through brand "noise" to engage with customersProviders will adjust their strategy to engage customers on visual-based social platformsProviders need to be aware of the limitations of social media marketingCustomer service will improve by responding to customer needsProviders must train customer service agents to act effectively during crisis management eventsPremature crisis management will weaken the providers brandProviders must empower customer service staff to respond effectivelySocial media necessitates a "single view" of the customerConvenience and compliance must be addressed equallyProviders must be able to scale their social communications in response to rising demandCrowdsourcing and customer feedback have a more tangible impact on servicesProviders will alter product features in accordance with customer sentiment analysisMore financial services providers will adopt customer ratings to build consumer confidenceCustomer interaction will have a more tangible impact in fostering continued engagementProviders will look toward fully socially designed products to empower consumersProviders will build brand value through customer advocacyProviders will increase their social media efforts on forums to generate brand advocatesMore providers will use crowdsourcing to increase brand reputationProviders will attempt to get key influencers to become advocates of the brandProviders will seek to strengthen the brand by catering to stakeholders other than customersAPPENDIXMethodology
  4. 4. Secondary sourcesFurther readingAsk the analystDisclaimerList of FiguresFigure: The usage of social media has grownFigure: Twitter is favored for customer service while Facebook and YouTube are preferred formarketing and brand buildingFigure: Chase has a Facebook page dedicated to promoting its Freedom credit cardFigure: HSBC encourages students to upload their own videos on HSBCs Facebook pageFigure: American Express uses customers social media profiles to offer personalized offersFigure: Providers are using social media to promote products consumers might not otherwise beaware ofFigure: ANZ has used Facebook to acquire new customers moving to AustraliaFigure: The majority of global retail banks offer customer service on TwitterFigure: An effective social media response to a service failure can gain positive responses fromconsumersFigure: The Commbank blog offers information and advice for consumers and commercial clientsFigure: Crowdsourcing portals are mostly offered by smaller or regional financial servicesprovidersFigure: Barclaycard Ring increases transparency by opening up the programs financialstatementsFigure: USAAs rating system inspires consumer confidence with its transparencyFigure: RB Jacobs provides a consistent experience for FNB customersFigure: Chase creates a more personalized feel by displaying its customer service teamFigure: American Express has strengthened its links to small businesses with the Small BusinessSaturday campaignFigure: Umpquas social media strategy reflects its "community bank" brand identityFigure: Scotiabank encourages consumers to share what is important to them for charityFigure: There are various ways providers can organize social media within the corporationFigure: Each internal model of social media usage has pros and consFigure: Breaking down silos will be an important challenge to fostering collaborationFigure: ANZ delivers effective customer service by responding to tweets directed at other ANZtwitter handlesFigure: Social media needs to be incorporated into a single view of the customerFigure: Santander is not using social media to its full potentialFigure: Fidor Bank empowers its customers to affect the interest rate the bank offersFigure: Wells Fargo is a rare example of a provider utilizing forums to generate advocacyFigure: HSBCs newsroom is dedicated to journalists and bloggersContact: for more information.