Bancography | Branch Planning, Marketing Research, Brand Strategy, Products & Profitabilty

Should You ‘Join the Social Media Conversation’ If No One Is Talking About You?

As social media tries to find its footing amid the financial marketing landscape, the concept of “social CRM” — using social media tools to manage existing consumer relationships — has been gaining more and more attention.

Consultants and the trade media point to banks like BofA and Wells Fargo as successful examples of how social media can be used to address customer problems, concerns and complaints. Financial institutions are told they need to “join the conversation” because “people are already on social media sites talking about you.”

Reality Check: No they aren’t. Banks and credit unions with less than $1 billion in assets are almost never mentioned on social media sites. Ever.

The notion of helping retail banking consumers through social media sounds like a good idea, but it simply isn’t a practical application for all but the largest financial institutions. In the credit union industry for instance, only about 175 out of some 7,700 — that’s 2%! — are large enough to be mentioned on social media sites at a level that warrants attention.

Smaller financial institutions have the most to lose with social CRM. They are always looking for new, inexpensive marketing tactics, and they hear consultants, experts and the media talk about case studies from companies like Dell and Comcast, so they run out and give social CRM a whirl.

Reality Check: Nearly every successful example of social CRM comes from companies with millions of customers, thousands of employees and hundreds of marketing staff.

Compared to these huge consumer megabrands, small banks and credit unions have far fewer resources they can gamble with. Any yet you’ll hear many social media experts offer blanket advice too all financial institutions, irrespective of size.

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There are social media enthusiasts who will say the volume of social mentions doesn’t matter; that you should automate searches and reply to every relevant comment every time, no matter what. But watch out… This approach can quickly turn into a sinkhole, where the employee responsible for monitoring and responding to social media mentions winds up spending wayyyyy more time dinking around Twitter, Facebook and YouTube than anyone expected. The magnetic pull of social media is hard to resist, especially when you can learn/read/see so many things that are ten times more interesting than the rest of your job.

Social CRM is a fantastic idea in theory, but financial marketers need to step back and look at the facts. The Financial Brand used social media search tools like Twitter Search, Google Realtime Search, Topsy and Social Mention to scan for references to banks and credit unions in Pennsylvania. Take a look at the results below, and you’ll see that smaller financial institutions simply aren’t mentioned very often. Only as you pass the $1 billion threshold do you start to see significant volumes of social media references.

Go give it a try for yourself. Search around for any financial institution with less than $1 billion in assets and you’ll be hard pressed to find much more than a handful of mentions at social media sites.

Bottom Line: Unless you can find at least 30 social media mentions each month from consumers within your service area, you are going to have a very difficult time justifying why your financial institution should launch any social CRM initiative, whether you (1) pull an existing employee from their current duties, or (2) hire someone to handle it. Financial institutions that are truly committed to answering their customers’ questions and resolving problems should look first at their existing service channels, then prioritize online chat over social CRM.

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Susquehanna Bank – $13 billion

Social Media Mentions: Less than 100 per month

Susquehanna is monitoring its brand on Twitter, sending approximately 6-8 tweets in the last 30 days to customers who have mentioned the bank. All tweets mentioning “Susquehanna Bank” in the last four days have been either spam/ads or one of many references to the arena bearing the bank’s name. Susquehanna also thanks the 6-10 people per week who use Foursquare to check-in at one of the bank’s 50+ branches. Assuming the bank has around 20 employees in its marketing department, it probably makes sense for them to have someone monitoring the web and responding to people via social media channels. Note: The bank has no Facebook presence beyond pages created for Susquehanna Center.

TruMark Financial Credit Union – $1.3 billion

Social Media Mentions: Less than 10 per month

With membership hovering around 100,000, this credit union has accrued 1,786 likes on Facebook, and there have been about a dozen wall posts in the last 30 days. TruMark also has 423 Twitter followers (many of them industry insiders and other credit unions), but doesn’t follow anyone back nor send @replies to anyone.

Clearview Federal Credit Union – $726 million

Social Media Mentions: Less than 1 per month

The credit union has a Facebook page with 147 likes. They were able to generate around 30 wall comments using a contest that required people to post “I love my CU and I would love those tickets!” But besides the occasional Foursquare check-in, there aren’t many social media mentions.

Franklin Mint Federal Credit Union – $689 million

Social Media Mentions: Less than 10 per month

There are a few tweets here and there, but most are about the credit union’s community events and don’t require much (if any) response. The credit union has 517 likes on Facebook, with about five total wall posts since January.

QNB Bank – $681 million

Social Media Mentions: Less than 10 per month

For Quaker National Bank, there is a conflict with Qatar National Bank, so results must be filtered. There are only two recent tweets mentioning the Pennsylvania financial institution, one from a public official congratulating the bank on a new branch and another casual reference in a news article. The bank isn’t on Twitter or Facebook.

Penn Security Bank & Trust – $645 million

Social Media Mentions: Less than 5 per month

The bank isn’t on Twitter or Facebook, so it’s no big surprise that they aren’t mentioned more than a handful of times, and even then, the references are casual. Every now and then, someone may check-in to a branch using Foursquare.

Sb1 Federal Credit Union – $562 million

Social Media Mentions: Basically none ever

SB1 is taking some heat in the business press over its mortgage operations this year, but all the tweets mentioning the credit union’s problems come from those outside the state of Pennsylvania. The credit union isn’t on Twitter or Facebook.

Kishacoquillas Valley National Bank – $486 million

Social Media Mentions: Less than 1 per month

The bank’s name has been shortened to “Kish,” but it’s still a very searchable term. According to Topsy, this half-billion dollar bank has only been mentioned a total of 69 times in the history of social media. Localized searches in Google Realtime seem to confirm this.

Honesdale National Bank – $477 million

Social Media Mentions: Less than 1 per month

Only one non-sponsored tweet about this bank so far this year, and it wasn’t the kind Honesdale would want to respond to. They have a Facebook page, but only 313 likes and less than a dozen posts on their wall in the last four months.

Juniata Valley Bank – $467 million

Social Media Mentions: Less than 1 per month

Good luck finding any relevant mentions of this bank. They aren’t on Twitter, they aren’t on Facebook, and no one is talking about them.

APCI Federal Credit Union – $454 million

Social Media Mentions: Basically none ever

There are only 6,650 Google search results for this credit union. That’s total. None of them are relevant social media mentions, just the random spam tweet here and there.

Sewickley Savings Bank – $261 million

Social Media Mentions: Basically none ever


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Comments

  1. I think it is a great idea for financial institutions to do a reality check to see if a Social CRM program is really necessary. Part of this problem stems from the fact that so many businesses want to create a Facebook Page or Twitter Account just because they read a great case study or attended a conference. Banks and credit unions need to base their social media efforts on real strategy and assign goals that lead back to that strategy.

  2. Social Media will never be a productive channel if the “communication” is about social events and hours of operation. Banks and Credit Unions – and particularly those with assets <$1b – should engage consumers who are current and prospective customers. Engage with information and offers that are relevant and meaningful to the consumer. I have yet to see this happen with smaller FIs or the mega-banks including WFB and BofA.

    "It" hasn't happened yet, but innovative FIs have a tremendous opportunity.

  3. Agreed Nathan. A strategically disproportionate obsession with social media has caused many financial marketers to lose their focus on the big picture. It often feels like a sideshow, a distraction, an afterthought.

    With social media, most financial institutions seem to start with the solution, then look for a strategy. They ask, “How should we be using Twitter?” when they should be asking, “What should we be doing to accomplish our strategic goals?” They define their objectives after they’ve already decided to deploy social channels. It’s like going down to the hardware store, buying a cool-looking tool, then running around the house looking for something to fix with it. Effective strategies are built by starting with what needs to be accomplished and defining the problem that needs to be solved, then looking for the answers, solutions and tactics.

  4. I think one point that was missed is the eye to the future. If we are at the pinnacle for customers interacting with brands, then this post makes sense.

    If you believe there is more room to grow (I do) I would argue that orgs that start now, even with small followings will be building the muscles they need for the not so distant future.

  5. I’m not convinced that successful social CRM efforts require “millions of customers, thousands of employees and hundreds of marketing staff.” Sure, we’re more likely to see bigger companies used as examples of successful social CRM. Most bigger companies have more customers and potential customers, and as a result, more people will be talking about them — both on and offline. But social CRM strategies can be effective for some small companies as well. Restaurants come to mind as an example of this.

    But, as this post points out, most financial institutions aren’t talked about enough to warrant the investment in a full-blown social CRM strategy. Most people simply don’t want to talk about their financial institutions — as least not in ways that would require a direct, immediate, and public response from the institution.

    My team often recommends that financial institutions “join the conversation.” However, we encourage offline socialization, interaction, and engagement before moving to the online social media space. This approach can reveal whether an online social media presence or strategy is worth the investment, and helps build an audience and internal skill-set that will drive and improve potential returns should that investment be made.

  6. After reading your post, I did a quick search for banks via Foursquare. There were over 50 banks listed and @ 900 check ins just within Riverside, CA. 23 “tips” from customers sharing information about those banks. The tips ranged from great place to bank and did you know which bank’s atms were inside 7-11 to expletives about the bank.

    While everyone is searching for ways to score big on Twitter, Facebook, and Youtube; bank customers are sharing with their friends when they visit a branch or atm. Maybe banks and everyone should stop chasing the numbers and go where their customers are really talking about them and engage.

    Since location isn’t as big a juggernaut as Facebook (for example), the time commitment should be less.

    If I walked into a BOfA and the teller said “Hey, the mayor’s here!” I think I would faint but I would be a customer for life. Oh, and you’d best believe I’d tell my friends.

  7. Brady, the article doesn’t say success with social CRM requires 1 million customers or thousands of employees. The threshold for financial institutions outlined in the article are $1 billion in assets and/or a minimum of 30 mentions per month.

    Financial institutions should approach all social media case studies with skepticism, because what works for Dell, Comcast, local restaurants and even other banks and credit unions may not work for them. Social media enthusiasts extol financial institutions to mimic the success of just about any company, regardless of scale, channel, strategic priorities, industry, etc.

  8. Love your comment, Cheryl. I hope they aren’t just checking Twitter and Foursquare. I bet if I set up a Google alert and socialmention alert I would find information about them like you did. Are they checking forums where people are chatting as well?

    And right off the bat, the headline tells it all. “… if no one is talking about you.” Well, if no one is talking about you, you got big problem. You better get out there and get them talking about you. That’s what every business wants, right? People talking about them, spreading their message for them. It’s one of the best forms of word-of-mouth advertising, so get out there and get them talking.

    Not to mention, 1. social search. Social media results are popping up in search engine results now. So, when your potential customer looking for a bank in your town types in the search bar “Bank (Your Town)” and your competitor banks who are on social media pop up in the search results and it shows that 2 of their friends “like” the bank, you bet you are missing out on a big piece of the pie. Where are you? Not there.

    2. Bing and Google have already admitted that social authority is part of their page ranking algorithm. Therefore, if you are not on social media – big zero for that part of the equation that determines which websites get shown first in page results on search engines. Guess who’s going to be on the first page of Google, your competitor on Facebook who just also recently stole your last two potential customers from a social search. The longer you wait, the harder it is going to be for you to catch up. Why would you allow your competition to just take your business?

  9. Part of my previous comment was in response to the reality check offered in the article: “Nearly every successful example of social CRM comes from companies with millions of customers, thousands of employees and hundreds of marketing staff.”

    While this may be true, my intent was to challenge people to think about small companies that are deploying social CRM strategies effectively.

  10. Ed Brett says:

    Just a quick (and possibly pedantic) question regarding methodology: why organize by asset size instead of client base? Aren’t you more likely to see a correlation between number of (already existing) relationships than asset size?

    The logic seems straightforward to me: the more people you have a relationship with, the more you’ll factor into conversations (either online or offline). Smaller FIs won’t feature in social media conversations as much as larger FIs for the same reason that smaller FIs won’t feature in regular conversations as larger FIs: because a smaller pool of people deal with that FI.

  11. Hi Ed,

    It would have been preferable to use “number of relationships” vs. “asset size” in the study, but unfortunately this data is extremely difficult to come by for banks (for credit unions, the number of member is public record). I don’t think more than one in five banks disclose the size of their customer base, whether that be intentional or not.

    If you assume that banks have about $20,000 to $30,000 in assets per customer, you can guess the number of customers a bank might have. Credit unions have about half that, in the range of $10,000 to $15,000 in assets per member.

    Whether you look at it by assets or customer base, only the biggest banks get mentioned with any measurable frequency. I’d say only the top 3-5%.

  12. Ed Brett says:

    Social media conversation functions in the same universe as any other conversation: if your FI isn’t in the mind-space of a consumer offline, it won’t be online either.

    Social media doesn’t magically solve engagement, awareness or market share issues. The basic entry costs in social media are identical for small organizations as they are for large ones, and this is what makes social media seductive to smaller organizations (“Twitter is free you know!”). As the Editor on this site has pointed out, however, the opportunity costs for small FIs *are* higher.

    Smaller FIs seem to also be overestimating the real amount of mind-space they occupy: it’s not clear to me that a service-oriented, approachable, community-based FI actually owns more of the mind-space of their clients on a day-to-day level than a behemoth, “too-big-to-fail” multi-national FI brand. The opposite may be the case, actually, given the massive brand and advertising presence of the “too-big-to-fail” banks.

    I’ll stop being pedantic now, and instead navigate over to YouTube to watch my all time favorite social media exercise: http://www.youtube.com/watch?v=CD2LRROpph0 (It’s Saturday tomorrow!)

  13. PW,

    Please re-read the article. It does not say “social media doesn’t work.”

    First Tennessee Bank has $25 billion in assets.

    Bank of Colorado has $2 billion in assets.

    Neither are in Pennsylvania.

    Paducah Bank has $500 million in assets. However, with the exception of a few Foursquare check-ins and news links, they aren’t showing up on Google, Twitter Search or Topsy. Out of the 69 total tweets they’ve sent since launching their Twitter account nearly two years ago, @PaducahBank has sent 5 @replies and follows two other accounts (one being Umpqua Bank). Paducah Bank does seem to be enjoying a higher level of success than their peers on Facebook.

    Unfortunately, Paducah is in Kentucky.

    The study was not deliberately engineered to make a point. A state was picked at random: Pennsylvania. Banks with assets ranging from $200 million up to $1 billion were selected at random by clicking on counties — again, at random — at this website. No bank or credit union selected for the study was dismissed after conducting a search for social mentions.

    To refute The Financial Brand’s study, you will need to find a bank or credit union within the state of Pennsylvania (not anywhere in the world) that has less than $1 billion in assets (not at any asset level) and is having success with social CRM (not just “social media” in general).

  14. Cheryl and Tracy,

    It sounds like you’re saying, “If you can’t find any social mentions, you’re doing it wrong. You need to try harder, and look more places.”

  15. Someone once told me there is enough information out there to find and support your stance if you look for it. Case in point, this article seems to have picked specific banks and credit unions to support the idea that social media doesn’t work. I can think of a half a dozen other FIs that are using their Facebook and Twitter with great results. Check out First Tennessee Bank, Bank of Colorado, Paducah Bank.

    A also echo the comment above to start out small and keep growing as social media does. Better to get in now and learn early then to try and figure it out later on when everyone else is way ahead of you. Will the content be as advanced as some of the bigger FIs, maybe not, but I don’t think it’s a good idea to ignore it.

    I have to believe these same conversations were going on ten-fifteen years ago when the internet was new and businesses were trying to figure out if having a website was a waste of time and didn’t fit in to the marketing goals…

    All businesses have elements of social, selling, customer service and so on. We all use them at different degrees. check out a newly launched “The Social Bank” on Twitter or Facebook. It’s dedicated SM for FI’s.

  16. Maybe not try harder, but try smarter.

    If the bank’s greeter doesn’t have anyone to greet is she doing it wrong? I think not, but a smarter use of her time might be to become the official greeter for both the online and face to face customers.

    It is really easy for businesses to say my customers don’t use (insert social network here) and then dismiss social media as a marketing strategy entirely. Being social with your customers is not new, the web simply allows us to move the party to new places.

    Whether you have 1,000 customers (or potential customers) or 100,000, smart marketers will find ways to connect and engage.

  17. Tracy,

    This article does not dismiss social media in general, just its application as a CRM tool for smaller financial institutions. While there may be SEO advantages to social media, this argument alone isn’t likely to persuade many executives that their bank or credit union needs to allocate staff time and resources. If SEO is important, then they should develop a broader strategy.

  18. Consumers, and Bank / CU customers, are not talking about their Financial Institution (FI) providers for a very simple reason. FIs have given consumers few reasons to engage unless that is, the FI errors in some way.

    Small FIs, maybe more so than their larger competitors, have an opportunity to engage consumers in a discussion. If no one is talking about you, start a discussion, draw audience and keep them engaged. This has nothing to do with contests and give aways nor is this in any way related to the FI’s civic engagements. The engagement must be 100% focused on the consumer. Educate, elaborate, provide commentary, advise, guide the consumer. Work to become one of the default options for information, insights, and guidance.

    Is it free? Not by a long shot. Do you need a lot of expensive technology. No! In fact, most of the technology can be free. But it does require significant effort from knowledgeable and creative staff. What choice to you have? Print, in-branch advertising, email blasts are not working.

  19. Tracy Terry writes: “So, when your potential customer looking for a bank in your town types in the search bar “Bank (Your Town)” and your competitor banks who are on social media pop up in the search results and it shows that 2 of their friends “like” the bank, you bet you are missing out on a big piece of the pie.”

    The question I have is: How many people really do this? Is this how people find the best banking product for them? Or do they search Yahoo Finance and Bankrate, and go directly to the sites of the banks they already know?

    I’m not convinced banks are missing a “big piece of the pie” here.

  20. Jennifer Spencer says:

    I expected to leave an angry comment here, but then actually read the article and realized I wasn’t angry. I was agreeing.

    People may or may not be talking about your small FI in social media channels, but that’s not the reason to get started in them. It’s about more than “joining the conversation,” it’s about creating marketing strategies that include all potential channels. It can also mean if there isn’t conversation to join in a place, there’s an opportunity to create conversation – but ask yourself first “Why?” Why create conversation about our FI? Will it lead to new accounts? Can we track that?

    I’d also disagree with Serge that nothing else is working – the whole point of Bottom Line #1 is to look at problem solving in existing channels, not abandoning them to run to social media. If it’s not working for you offline, what makes you think it will work online? Also, “Social media is about engagement” is an incomplete thought. Engagement to what end? Customer retention? Customer service? Sales?

    Lots of FIs have been slower to adopt social media into their marketing/customer service than other kinds of companies- let’s not get them started on the wrong foot. Articles like this are an excellent reminder to take a step back and strategize.

  21. Thank you Jennifer. Your comment is one of the most thoughtful I’ve seen on social media in the financial space.

    A lot of people commenting on this story are responding to the headline only.

  22. Rob B. says:

    Social Media = Waste of Time*

    *For small financial institutions.

    Now, how much more time are we going to spend talking about how it’s such a waste of time?

  23. 10-15 years ago there were similar discussions that online marketing & ecommerce were a waste of time. Today, there are THE dominant channels.

  24. Serge, the difference is that websites proved their value and ability to impact the bottom line much, much quicker than social media. Within five years, nearly every bank and credit union had a website. We’re at least five years deep with social media, and people are still scratching their heads wondering what it’s good for and whether they really need it.

    Also, using such an argument may provide some anecdotal interest, but it is logically fallacious to assume that the past success of one innovation will apply equally to all future innovations. This kind of reasoning says to those who raise questions and exercise scientific skepticism that they are foolish.

    One could raise this argument with every new invention that came along. Then where would we be? What if it was 1970 and I was trying to roll out 8-track tapes with this argument? “People said the telephone wouldn’t take off.” “30 years ago, people said TV was just a fad.”

  25. To be fair, “internet” was “operational” in early 1980s; so, it actually took ~15 years for wide-spread adoption. However, it is fair to say that past performance does not guarantee future success. However, it is equally fallacious to suggest that we should ignore new channels simply because we have not figured out how to use them (effectively).

  26. Serge, when has The Financial Brand ever suggested that organizations “ignore social media” completely?

  27. My comment was directed at the “Social Media = Waste of Time (for small FIs)” view not at Financial Brand.

    [Editor's note: There is an article on The Financial Brand titled "Why Social Media Is a Waste of Time for Most Financial Institutions."]

  28. Rob,

    If it only took one article to address all the hype surrounding social media, that would be a miracle.

    There are two separate conversations going on here. One, here in the comments, is about the usefulness of social media in general. The other, in the article, is about the specific application of social media as a CRM tool.

    This article is intended to attack one of the more common social media rallying cries — that financial institutions need to be involved with social media because “people are already online talking about you whether you like it or not, whether you’re engaged or not.” This article takes one of the theories presented in The Financial Brand’s previous treatise on social media and puts it to the test, exploring the subject of social mentions in greater detail.

    Arguing about the role of social media in general is the same thing as trying to argue that advertising does or doesn’t work. It depends on what you’re talking about and for whom. What are we talking about? Are we talking about TV advertising, billboard advertising, print advertising, radio advertising, guerilla advertising, etc.? Are we talking about advertising for a multinational consumer products company or a family-owned restaurant? The same thing goes for social media. Are we talking about YouTube? Blogs? Twitter? Facebook? Contests? Social CRM? And for whom?

  29. Great article, and helps to bring social media back down to earth with some hard data…what happens when smaller CU’s engage their membership through social media? Any stories on that?

  30. Hi Simon,

    I know Mt. Lehman Credit Union up in your neck of the woods has done quite a few things with social media. It’s probably easier for micro credit unions (those with less than $100 million in assets and only one branch) to make social media work than those between $100M-$1B. Gene Blishen, the CEO of Mt. Lehman, and his 12 or so employees know each and every member personally, so building social media engagement might be something that happens more naturally than the semi-anonymity both staff and members might feel at a credit union with 40 staff and 15,000 members.

  31. Financial Brand Editor – I have been a VP of Marketing & Business Development at a $400MM credit union in 2010/2011 and I’ve consulted with brands around the world. Whereas I typically agree with everything you publish — I need to disagree with your cause & effect assumption.

    Your observation is correct that smaller financial institutions lack social mentions online — but your conclusion that this means they should ignore social media is wrong. Let me explain.

    Most banks (and virtually all credit unions) are stuck in a marketing mode of 1990 (print, broadcast, outdoor, and basic email). Few have executed modern marketing best practices such as buyer personas, content marketing, segmented marketing automation, and customer-driven social engagement. They “push” products and promotions instead of engaging via online/offline financial education, financial coaching, or content feeds. I talk with employees at Salesforce.com who sell CRM to banks only to come back 1-2 years later to see that the banks are not using it as a platform for engagement.

    The social media strategy by many financial institutions is self-centered: cheezy Facebook pages with loan offers, meaningless Twitter posts with “look at me” PR releases, and other self-serving “push” communications. So why the heck would anyone Like, Follow, or otherwise connect? The fact that banks/CU’s are not getting mentioned shouldn’t surprise anyone.

    So your conclusion is “why bother?”

    I will argue that to compete against national banks with mega-marketing departments and budgets, the smaller banks & credit unions need to master the art of engagement as their biggest competitive differentiator. This is how all small businesses beat their bigger competition: better service via higher engagement.

    The observation that smaller financial institutions aren’t seeing their name show up in many social posts, is because they’re not giving people a reason to talk about them. This is the nugget to be gleaned. Seth Godin’s book “Purple Cow” or the renown brand book “Eating the Big Fish” shows us how to build Challenger Brands — the question is whether financial institutions will gamble on the DNA change required to win.

    So the conclusion to be drawn here is not the social media is a waste of time — rather, it may be the only battlefront where the small provider can “take on” the bigger provider.

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