According to Mashable.com, retail banks use social media most often in five ways: to build their customer community and gain referrals; gain product development insight through customer suggestions and crowdsourcing; facilitate customer service interactions; expand marketing and promotional efforts; and be more transparent and efficient than in other communication channels. Below are examples of how some banks put these social media efforts into action.
1. Community building
As a branchless bank, Germany's Fidor relies on its social infrastructure to help grow its business. The bank encourages consumers to interact with one another with advice and insight, getting and giving social loans, discussing product and service pros and cons, and more. Community members discuss product evaluations, use calculators and product comparison tools, and work with financial advisors. Customer profiles are accessible and integrate with Facebook, Twitter, eBay, and business social network Xing, allowing for easy sharing of information and connection to non-customers.
2. Product research/crowdsourcing
Earlier this year Danske Bank in Northern Europe launched a Facebook application called "Idebank" that gives consumers an opportunity to suggest improvements for current products, including its mobile phone and iPad apps, mortgages, and other loans. The app focuses on one topic per month, says Thomas Heilskov, manager of group communications for the bank . The initiative helped grow Danske Bank's Facebook fan base from 2,000 to more than 8,500. As of November 2011 customers have submitted more than 440 ideas, 400 comments, and 7,200 votes through Facebook. Ideas are then implemented based on their popularity in the community and feasibility of the change. Heilskov says communicating with the community about the idea implementation is critical to continued consumer participation.
3. Customer service
ASB Bank in New Zealand promotes its Facebook page as "just like a regular branch, only right here on Facebook." Users can live chat with a bank advisor to resolve customer service questions, find out more information about new products, such as loans and savings accounts, or access bank information. And understanding the sensitive nature of banking issues, ASB has put security measures in place to keep the chats secure even on the Facebook platform.
4. Marketing and promotion
Nicolet National Bank in Wisconsin shares ideas and information through a series of blogs, podcasts, and videos in a community called The Vault. It's designed to be a financial information resource "direct from experts," such as Chairman and CEO Robert Atwell, President and COO Michael Daniels, and Nancy Johnson, vice president and trust officer.
5. Transparency
Today transparency is typically a one-way street in the banking world. Customers provide every type of information for a bank to make decisions based on credit scores, income, etc., but many banking practices are hidden from customers and the public. The transparent nature of social media will eventually permeate into banking activities if they are to sustain social media activity that consumers find valuable. Savvy banks, such as Wells Fargo, retain negative comments on Twitter and Facebook consumers, and quickly respond with appropriate responses and escalation steps.
About the author: Dietrich Chen is a director at Peppers & Rogers Group. Contact him at dietrich.chen@peppersandrogersgroup.com.