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Should Financial Institutions Show Interest In Pinterest?

Pinterest is an online visual bulletin board and the current social media flavor of the month. Users “pin” photos of things they find that are cool and interesting. Photos commonly found on Pinterest include fashion items, recipes, motivational posters, inspirational quotes, pets and babies.

By Ron Shevlin, Senior Analyst with Aite

No doubt about it: Pinterest is the hot new social network. With 11 million unique visitors a month — and growing — marketers at financial institutions are being told that they should not just pay attention to the site, but begin to use it for marketing purposes:

  • Bank Innovation alerts financial institutions to the advertising potential of Pinterest in not one, but two separate blog posts: “If women are buying wedding shoes through Pinterest, I don’t see why people will not eventually buy banking services for those weddings through Pinterest.”
  • The That Credit Union Blog suggests that credit unions (or banks, conceivably) could create a Pinterest page that highlights money saving tips, co-op news, or community-related information.
  • CUES Skybox says credit unions could pin images of marketing materials at Pinterest. They explore using the service for a home equity promo, pinning images of great looking kitchens or a lovely pool. Or to promote an auto loan product, pin photos of cars at a local dealer where a credit union does indirect lending.
  • More generally speaking, Mashable advises marketers to use Pinterest to “promote a  lifestyle,” run contests, and create focus groups for marketing research purposes.

There is some sound rationale behind this advice. The composition of Pinterest users is heavily skewed to women, and there’s solid research behind the belief that women make the financial services decisions in a majority of the households in the United States.

But should your bank or credit union get involved with Pinterest?

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“People go to Pinterest to look at cool, interesting and visual things. Banks are none of those.”
– The Financial Brand

I’m reminded of something my mother used to tell me when I told her my friends were all doing something: “If all your friends jumped off the Empire State Building, would you go jump off the Empire State Building?”

I’m not suggesting that exploring marketing opportunities on Pinterest, and failing to achieve meaningful results, would have the same dire consequences as jumping off a tall building. But I am suggesting that financial services marketers use a rigorous set of criteria for determining whether or not to “take the leap” on Pinterest.

When deciding to use Pinterest—or any other social network—financial services marketers should determine if it helps their organization achieve any of the following four marketing objectives.

1. Create Awareness

Does the social network help the bank or credit union generate awareness of the organization among a set of consumers?

Women are the target audience of many financial firms as well as the primary users of Pinterest. But with just 11 million users — yes, just 11 million — there is a strong case that other media channels can better be used to generate awareness. Most credit unions and banks (those below the $50 billion in assets) focus their advertising efforts in a very narrow geographical area, usually centered around their branch footprint. Creating awareness among the 1 million residents from the six counties in which your financial institution does business is best done with TV, radio, or print advertising — not Pinterest.

It’s analogous to Twitter. There are 500 million people on Twitter, only tiny fraction of that number see even a small percentage of each individual user’s tweet stream. Same thing with Pinterest. Just for argument’s sake, let’s say all 11 million Pinterest users fit your target prospect… So what? How can you be sure your ad would be seen any meaningful percentage?

2. Influence Preferences

Does the social network (Pinterest, in this case) help your bank or credit union sway consumers’ preferences, or their likelihood to do business with your organization instead of other financial institutions?

There is a lot of market research out there that purportedly identifies why consumers choose one bank or credit union over another — branch locations, rates and fees, customer service quality and reputation, referrals from family, friends, or other people, rewards, etc. But this list contains nothing that relates to Pinterest in any way.

Kiosk & Display | 2014 NEFMA Spring Conference

3. Make a Sale

Does a social network like Pinterest help the bank or credit union open new accounts or generate revenue through other types of transactions?

Bank Innovation raises the point that Pinterest may take an active role in the transactions the site is facilitating, and that “payments must be an option it is considering, [which] has a bearing on banking, just as Facebook Credits have banking implications.”

True enough. But it’s very unlikely that any of those transactions will be the opening of checking or savings accounts, car loans, mortgages, or credit card accounts. Furthermore, while the potential for something like Pinterest Credits is a real possibility, any individual bank or credit union doesn’t have a lot it could do today to position itself for that future opportunity. The deal will likely go to one big bank and that’s it.

4. Engage Customers

Do social networks like Pinterest help the bank or credit union engage customers in meaningful ways that will increase the emotional connection the customer has to the organization?

Pinterest does do a good job of engaging its users. As Mashable writes, “Millions of people use Pinterest to keep track of objects they love, places they enjoy, foods they devour and things that inspire them.”

But from the perspective of an individual financial institution, engaging consumers on Pinterest is a lot easier said than done. Sure, a money savings tips page might engage consumers, but how will your customers and members find out about your Pinterest pages in the first place?

Through marketing efforts, of course. But marketing has limited resources, and competes for the  limited attention of consumers. While a campaign to make customers aware of a Pinterest page wouldn’t require a huge investment, why would a bank or credit union want to push its customers to a Pinterest page instead of the Facebook page it’s already created, or to the blog it’s created, or to the financial education pages it’s created on its own site?

Through the lens of these four key marketing objectives, we can now pose the question: Should banks and credit unions show interest in Pinterest?

The answer is clearly: No, not today.


Ron Shevlin is a senior analyst at Aite Group, a Boston-based research and advisory firm serving the financial services industry. You can pick up a copy of Ron’s latest book, Snarketing 2.0, at Amazon.com. The book is a balance of keen, entertaining observations loaded with educational and practical advice that doesn’t pull any punches. Ron is a regular contributor here at The Financial Brand. You can read more from Ron on his blog, or follow Ron on Twitter.

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Comments

  1. This is a great and very timely post as bank marketers have a tendency to follow the next shiny object (stopping short of jumping off the Empire State Building). Could Pinterest create awareness and engage consumers? Possibly, but probably not for traditional financial services like a checking account or CD. And as Ron said, there are better channel options for that.

    Where I could see Pinterest play a role would be with specific segment selling (small business) or with a specific event or promotion (sweepstakes comes to mind). Pinterest could potentially also be used in conjunction with other media to illustrate what a customer could receive from a rewards program since the power of rewards is not in the points, but in what you can receive for the points earned.

    While not an ad supported web site yet, the power of Pinterest in the future for financials may be in promoting services on the site in an ad as opposed to using the site to promote the bank through pictures.

  2. I agree – I don’t think banks are a good fit, at least not right now. I think the banks that could use it best are those who can approach it creatively.

    As a “pinner” myself, I think the idea of putting marketing materials up there is TERRIBLE – I think Mashable’s idea to promote a lifestyle would be more successful.

    http://ehmccormick.wordpress.com/2012/02/21/to-pin-or-not-to-pin/

  3. I disagree, at least in our case. As Community Manager of SafetyPay I have to improve the visibility of the brand and create awareness among our potential customers. Pinterest could be a nice way to do this. Why shouldn’t all the shoe-, clothes- and car-lovers on Pinterest buy these things via Internet? We give them inspirations and pin the items on our board they want to have. And they have the option to click on the items, go to the original website and buy with our secure online payment method.
    We still don’t have an Pinterest board but it will come soon.

  4. Through marketing efforts, of course. But marketing has limited resources, and competes for the limited attention of consumers. While a campaign to make customers aware of a Pinterest page wouldn’t require a huge investment, why would a bank or credit union want to push its customers to a Pinterest page instead of the Facebook page it’s already created, or to the blog it’s created, or to the financial education pages it’s created on its own site?

    The entire beauty of Pinterest is that you can see other peoples pins and follow what they are linked to. (it also connects with FB and twitter)

    Pinterest is still in it’s infancy and although it’s popular with the “mommy” crowd now it’s quickly catching on in other demographics.

    Financial institutions need to take notice of new platforms like Pinterest not as yet another place to “engage” users, but as a new source from which we can generate online traffic. You would pin an image about money saving tips as a means to send people to your financial education seminar sign ups,articles,etc.

  5. @TheFinancialMarketer – Isn’t that a pretty circuitous approach? Put a pin on Pinterest… to a website with financial education tips… so someone can attend a webinar… that may lead to interest in loans/accounts? Why not just do a better job of marketing loans and accounts directly? If increasing web traffic is a priority, why not try other, established (and arguably more effective) methods, like Facebook ads or Google Adwords? Or an SEO strategy?

    The vast majority of financial institutions have ignored a lot of low-hanging fruit — real money sitting right in front of them — as they’ve experimented with highly speculative social media tools.

  6. @editor

    I 100% agree with you and feel very strongly that institutions need to do a much better job of optimizing vertically with their current channels before they start to do any branching out. Just optimizing/analyzing online forms and applications would be a big step forward for most.

    I was only pointing out in my previous comment the misguided logic of driving people to a social media page/account vs leveraging that platform as a traffic source to your website or business. (which as you already mentioned and I’ve blogged about is much better done through advertising)

    I wouldn’t recommend any bank/CU that doesn’t even know what SEO is; turn their attention to gaining traffic via Pinterest, but as new platforms develop new opportunities to gain traffic come with them.

  7. We have looked at this for a financial client and while I agree that currently the pool of potential customers is limited I still think there is an opportunity here to take a support position for more general marketing. This is a creative outlet that will fit some brands, and perhaps not others. For example, one could use it to further engage membership that it already has by picking a topic and asking customers to submit-say a creative picture of their new house (mortgages) wedding(personal loans) or cool beat-up gallopy pix(car loans). There are also ways to source/repin local businesses and community members who already have “pinned’. By engaging them, you have expanded your local network. This type of activity will not be for everyone and I do not think it would replace bigger efforts, but used in combination can drive SEO and be a brand building tool.

  8. What companies can use social media for and what will work well are seldom the same thing. Lots of ideas, little success.

  9. What consumer is going to want to look at marketing material on Pinterest? Would any of you? I can see it now, pictures of aging couples walking on a beach … with the headlines like “Open Your IRA Today at Anybank USA”. Yeah, that will get plenty of “pins”.

    How about we see FIs focus on building websites and mobile platforms that are practical, inviting, engaging, relevant and highly functional. 93% (or so) CU members go right to the online banking log in, so maybe the only “pin” that should “interest” FIs is the log-in pin, and what is behind in.

  10. @Bryan – One could ask pretty much the same questions about Facebook and Twitter. Marketers lose sight of the fact that people use social media to talk about things that are interesting, fun, funny, etc. People use social media largely as a diversion, to be entertained.

  11. Pretty much. But I view Pinterest a little differently, because I don’t see how one can use it to drive any relevant dialog (it is more a visual experience). I would love to see an FI use it successfully, but I won’t hold my breath.

  12. Update: Pinterest makes all links “nofollow,” so brands won’t get any SEO value from involvement on the nascent social media platform.

  13. My abbreviated answer is that while Pinterest is an exciting new social platform, the business case can’t yet be made to justify the time and effort of establishing an effective presence.

    I started to fire off just a short comment, but found myself writing a longer response. I’ll spare you all here, and encourage you to review my more complete answer on the Beyond the Arc blog (http://beyondthearc.com/blog).

    Ron, great post, thank you for sparking the conversation about such a timely topic!

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