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December 31, 2014

Financial Services Serve Up Social Media

Posted by Rajashekara V. Maiya (View Profile | View All Posts) at 4:09 AM

Digital connections can help financial services companies connect with customers in a more meaningful way

An important metric for any industry is to measure conversation length over social media. Some sectors, like the retail industry, know how to foster consumer loyalty and get them talking about it over social media channels. I bring this point up because some industries have a long way to go when it comes to leveraging this valuable medium.

Among them is the financial services sector. Recent analysis found that the average length of time spent discussing banks online is just 30 percent of the time consumers discuss telecommunications. And it's just 15 percent of the time that those same people spend chatting about media and entertainment companies.

Don't get me wrong: People consider their relationships with their banks to be very important. They're entrusting these venerable institutions with their savings. My point, however, is the digital connections that these banks are making and sustaining with their consumers. If and when they can effectively use Information Technology to learn what their consumers are thinking (and talking about), such companies will be able to develop more relevant financial products and connect with them in a more meaningful and lasting way.

A similar study that measured online advocacy discovered that the typical bank has an audience that is just 9 percent of advocates - die-hard fans, really - in social media circles discussing the typical telecommunications firm. And just 2 percent of the crowd advocating a media and entertainment company. One of the ways financial services firms are connecting with their consumer base is through co-creation and gamification over social media. Such digital tools target an audience and help the organization understand vital relationships better.

Banks are beginning to do an admirable job of grasping the social context of their consumers ... and even employees. These trends are still emerging and there's a lot we have yet to discover about their advantages as to how they're changing the ways we all do business.

What the financial world does know is that when it can become more familiar with its colleagues and consumers by interacting with them in a fun yet instructional atmosphere, everyone wins. And it's often so seamless of an experience that nobody realizes it's happening. This is all part of a broader, multi-channel engagement model. Each customer will choose the way she wants to interact with a brand. It's up to the brand to figure out the best way to do this. Co-creation and other methods are innovative approaches that have lots of potential in banking and financial services.

There are huge opportunities for financial services firms in the year ahead of us. The year 2015 will be filled with digital surprises! Co-creation can be extended with gamification to make a broader, more engaging customer experience. Although customers may not yet be burning up Facebook or Twitter while discussing their favorite banks, there is already a high level of trust between a bank and its clients. That is the kind of trust that can be extended across all sorts of interesting digital channels and networks.

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