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Social Media, for Customers and their Banks

Posted by Vivek Sharma (View Profile | View All Posts) at 9:00 AM

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For a long time, consumers were quite apathetic about their banking decisions. And who could blame them? Products were standard across institutions, with very few or no variations, and one bank looked like the other. Customers chose their bank based on location, acquaintance with employees, and word-of-mouth reviews.

However, in this "knowledge era", many decisions are making their way into high-involvement territory, banking included.  Today's customers are confident, knowledgeable, and highly inquisitive. Before giving their business to any bank, they would like to know a lot more about it. In other words, they are very involved in the products and services they consume.

So, while  choosing a bank, these tech-savvy customers make extensive use of information available on the Internet, including that on social media platforms. They don't  blindly take a decision on the basis of the family's advice or word-of-mouth; they do it based on what they know. These customers make informed decisions by aligning their requirements with the products or services offered by the bank. They also weigh the bank's brand personality against their own.

Banks are facing different challenges from the environment. Apart from dealing with competition and providing services to increasingly demanding customers, they are plagued by concerns of acquiring and retaining them.

Present-day customer behaviour is significantly influenced by social media.  Hence, it is imperative for banks to connect with their customers on social media platforms, share relevant information, take feedback, give heed to problems, and also respond to them in real time.

Moreover, banks need to be proactive and highly responsive to stay relevant in the dynamic world of social media; they also need to customize their services and communication to its trends. In this way, a bank can build its own brand personality, which appeals  to its customers, and also connect with them at an emotional level. It's a fact that customers who relate thus, stay longer, generate greater business, and make better advocates.

Today, banks are at the crossroads of social media. They can choose to be active in it, or stay away altogether. Those that take the latter route must know that they're doing so at the risk of losing customers and market standing

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