Why should a bank use social media?

Engage121, Inc. will be a sponsor at the New England Financial Marketing Association (NEFMA) fall conference in Newport 10/6 – 10/7.  Engage121’s Steve Paster will be there, and he offers his thoughts below on how banks can use social media to drive business goals.

As I am preparing for my trip, I keep thinking about the question I expect to get the most: Why should a bank use social media?

My answer is straightforward but hard to accept: You should figure out your marketing goals and objectives, and determine how to leverage social media to achieve them. 

Here are some examples of how this can be done:

  • Differentiation:  One bank’s money is as green as the other, yes?  Well, how about differentiating the consumer’s experience with social media?  We have financial services clients who are creating vibrant Facebook communities – and seeing dramatic increases in fans translating to new accounts, retention and overall awareness.
  • Product Awareness:  Our financial services customers want greater product awareness.  Personally, I use about 10 different companies for my checking, savings, retirement, insurance, credit card, mortgage, and car loan.  I am sure there is an overlap of services among those companies, and each would love to have more of my business (I just took diversification too literally I guess).  These customers can get the word out through social.
  • Customer Growth and Retention:  Our clients monitor what their clients and prospects are saying in social media.  They can identify trends and join the conversation, in real time, where appropriate.  Other community banks realize that they have something in common with their clients, their community, and use social media to show support, promote upcoming events, and show their active community stance.  This helps drive new customers and keep the ones they have.

As for me, I don’t “like” my bank on Facebook.  Why?  They don’t even have a page!  In general, my personal sentiment towards them would be neutral.  That is, until I recently learned that they plan to charge a $5 monthly fee if I use my debit card.  There is outrage against them on Facebook and Twitter, yet they do little to protect themselves or insulate their brand. 

If a bank has an engagement application in place, now would be the time to interact with the upset customers of my bank, and entice them to try a better alternative.  

Banks also worry about compliance (maybe that is why my bank does not have a page). Engage121 can help with that as our product has built in approvals, permissions and archiving that let banks comply. 

I am looking forward to talking to NEFMA attendees about meeting their goals compliantly through social media.


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