11% of Consumers Have a Social Media Connection with Their Bank? No Way…

Fiserv Study Fuels Social Media Hype

A social media white paper released by Fiserv, the leading global provider of financial services technology solutions, says that “11% of online consumers are currently connected with their bank or credit union through a social site.” Fiserv’s white paper was based on an August 2010 survey of 3,000 U.S. consumers who had checking accounts.

This finding — that 11% of online consumers are connected to their financial institution via a social networking platform — is shocking. Could this really be true?

Realistic Numbers

Let’s break it down and take a look at the math. Out of 307 million people in the U.S., 231 million of them are online, or 75.2% of the country. That means a financial institution with one million customers — we’ll use the fictitious “Acme Bank” as an example — could feasibly reach 750,000 people via social media. If Fiserv is right and 11% of Acme’s customers are indeed already connected to Acme Bank through social networking platforms, then Acme would have a following/community that totaled 82,500 people.

According to Fiserv’s data on consumer usage of social networking sites, approximately 75% of people have a Facebook account, about 50% use YouTube, and around 25% are on Twitter.

MySpace is effectively dead, and Joe Consumer doesn’t use Classmates.com or LinkedIn to connect with businesses, so really we’re talking about Facebook, Twitter and YouTube. (There are other platforms like blogs, but those weren’t included in Fiserv’s study.)

Back to Acme Bank. Assuming the bank has a Facebook, Twitter and YouTube account, Acme’s following of 82,500 customers would approximately translate to 62,500 Facebook fans and 20,000 Twitter followers. YouTube is harder to estimate, since there is a distinction between “subscribing to a channel” (which fewer people do) and merely “watching a video.”

To summarize Acme Bank’s social media penetration:

  • Customers: 1 million
  • Customers with internet access: 750,000 (75%)
  • Customers connected via social media: 82,500 (11%)
  • Facebook Fans: 62,500
  • Twitter Followers: 20,000

Now let’s look at reality. Bank of America has at least 50 million customers. According to Fiserv’s study, BofA’s social media following should total over 4 million people. They should, Fiserv’s study suggests, have nearly 1 million Twitter followers. And yet the bank’s five separate Twitter accounts have a combined total of 16,096 followers. That’s only 0.45% of BofA’s customers who are online, missing the result in Fiserv’s study by 10.55%.

How many Facebook Fans does BofA have? Zero. Because BofA doesn’t have an official Facebook page. But when you add up all the unofficial Facebook pages together (including the Bank of America Sucks group with 1,850 fans and BofA’s Chicago Marathon page with 15,000), the total isn’t more than 50,000 people. Even if BofA were to reach 500,000 people via social media, that’s still only 1% of the bank’s customer base.

Wells Fargo’s social media exposure includes two Twitter accounts, three YouTube channels, four blogs and five Facebook initiatives. Out of 48 million customers, they have a total of 4,096 Facebook likes (0.009% of customers) and 13,415 Twitter followers (0.028% of customers). Videos uploaded to Wells Fargo YouTube channels have been viewed 108,540 times. To put that in some perspective, The Financial Brand’s YouTube videos — mostly bank and credit union commercials — have been viewed 450,486 times.

Reality Check: You can repeat this analysis for nearly every bank and credit union in the U.S. and you won’t find anywhere near 11% of customers connected via social networking sites. Even 1% is overly optimistic.

In Conclusion?

A white paper like Fiserv’s is widely celebrated by consultants, recirculated by the trade press and embraced by financial institutions because it tells everyone what they want to hear; it reinforces what they want to believe. Everyone wants the social media hype to be true so badly that they swallow favorable studies without much analytical scrutiny or intellectual skepticism.

When Fiserv serves up a white paper with a leading datapoint that’s as wildly implausible and statistically indefensible as “11% are socially connected to their bank,” you have to question the white paper’s other conclusions:

  • “36% of those currently not connected are interested in doing so. Interest is highest among Gen Y consumers at 45%.”
  • “71% of respondents who want to connect with their bank or credit union via social channels did not know they could.”
  • “Consumers who are already connected or interested in connecting use an average of 5.4 banking services as compared to 4.3 for consumers who have little or no interest in connecting.”

The Financial Brand isn’t alone. As bank branding expert Brady Walen said on Twitter, “I have a hard time believing that 45% of Gen Y is interested in connecting with their bank or CU on a social site.” Another financial branding consultant quickly agreed.

Here’s Fiserv’s presentation, or you can download the full white paper. Take a look for yourself and see what you think.

Jeffry PilcherDon't miss The Financial Brand Forum 2019, the biggest and fastest-growing annual conference for senior-level executives in the banking industry. Join 2,000+ of the best and brightest in banking April 15-17, 2019 at Caesars Palace in Las Vegas. Banks and credit unions that register now save $1,105.00 and pay nothing until next year!

This article was originally published on December 8, 2010. All content © 2018 by The Financial Brand and may not be reproduced by any means without permission.


  1. I think this is a classical example of survey bias. It sound like proverbial: As the results of the internet survey show 100% of Americans are connected to the internet.

  2. Josh Kalkbrenner says:

    Large institutions such as BoA and Wells Fargo may skew the results just a bit. We (SpotBanks.com) too thought the numbers in Fiserv’s survey were a bit high, so we performed a bit of analytical scrutiny. Of 418 NCUA insured Credit Union on Twitter, we found a ratio of 6% where total twitter followers were divided by total members of Credit Union who use Credit Unions’ website.

  3. Tim McAlpine says:

    Excellent analysis. I wonder what the motivation is in creating an exaggerated picture? Poor data? Impending social product launch? Honest mistake? Just curious.

  4. I asked the same question in my Twitter post on 12/7. Agreed, everyone wants the social media hype to be true, so much so, that a number like this [11%] is easy to pass along. The power of social media is much broader than numbers of followers though, and I still have faith that in time, the channel will be able to influence financial consumer behavior in the way that others are experiencing. I applaud the work you do with The Financial Brand and the passion that so clearly sets you apart.

  5. Sandi, I agree that social media means more than just the number of followers, but the Fiserv study clearly says “connection,” which I interpret as some sort of on-going relationship (e.g., “friend,” “follower,” “subscriber,” etc.).

    Also, thanks for the feedback.

  6. Brady Walen says:

    Thanks for the great analysis here. It would be nice to hear from someone at Fiserv – hopefully they’ll address these questions to help us better understand the data.

    While the 11% number seemed high to me initially as well, I was completely thrown by the stat mentioned later in this post: “36% of those currently not connected are interested in doing so. Interest is highest among Gen Y consumers at 45%.”
    (as mentioned in my tweet that you referenced)

    I think about my Gen Y friends – 45% of them aren’t “interested” in connecting with their financial institutions. I’d be surprised if more than 1 or 2 of them were connected to their institution…and I don’t see that changing anytime soon.

  7. Josh, in your study did you assess whether Twitter followers were actual members? Many financial institutions are followed by banks, credit unions and other industry insiders — often the same 100± people.

  8. Josh Kalkbrenner says:

    @Editor, unfortunately we did not have the resource to assess whether the followers were actual members; to be realistic, I highly doubt the majority are. On another note, aside from consumers wanting to “connect” socially, we found consumers use twitter to publically express complaints and ask questions. BoA for example: we found BoA Twitter page to contain 100 (public) Bank to Consumer tweets per day. Although those figures are by no means revolutionary, the consumers desire to express frustrations socially may change the way Banks approach customer service. Thoughts?

  9. In a recent national consumer survey we (Raddon Financial Group) fielded, only 4% of consumers indicated they had ever visited their financial institution’s social media site:

    Also note – the question was worded as “ever visited”, so these aren’t even necessarily fans/followers, or repeat visitors (although some may be of course).

  10. It is without doubt that social media is a communication channel that many/most banks/CUs have failed to leverage.

    I think it is important to understand that “connecting with your FI” does not necessarily mean “liking” them on FB or “following” them on Twitter. This assumption appears to be central to the Editor’s rebuke of Fiserv’s study.

    For example, I have several searches set up on my TweetDeck to follow specific FIs. I would consider myself “connected” to them, although I have not “liked” them on FB nor “followed” them on Twitter. This nuance may be critical in interpreting FiServ results, and more generally, assessing “connections” between consumers & businesses.

    In addition, I would point out a correction to the editor’s analysis… while it is true that there are 307MM people in the US, that equates to only ~$117MM households (~25% of the population is under 18 and thus not able to have individual bank accounts; and married couples typically have joint accounts). Given the 77.3% internet penetration, the net opportunity is ~91MM households. But ~9MM of these households are unbanked, thus the true “market size” is only ~82MM households. Total social media opportunity totals 136MM adults based on 1.95 adults/household, 65% penetration for FB and 20% penetration for Twitter (based on FiServ’s study).

    How many of these 136MM are using social media, in some way, to learn, communicate, discuss, share anything about their bank? Does 15MM consumers (11% of 136MM) sound high?

    PS: my experience is that many smaller Banks/CUs tend to reject the value of social media outright – largely based on gut but very little information.

  11. Serge, yes there are other ways to “connect” with companies on social media platforms other than Facebook likes and Twitter follows. However, these are assuredly the most common forms of connecting. The Tweetdeck searches you describe (similarly used by The Financial Brand) are rare, exotic “power-user” exceptions.

    FYI – Fiserv has explained to me that they defined a “connection” in the survey as “friend, fan, follower or subscriber.”

    And yes, I concede that the article’s math was a little lazy/sloppy, but it doesn’t change the end result: The net “connections” retail banks and credit unions have with consumers in absolute terms does not constitute a significant number.

  12. Geoff Knapp says:

    In the survey, which was completed by 3000 respondents representative of the U.S. online population, we asked consumers if they were connected to a financial institution, and defined “connected” within the survey as “friend, fan, follow or subscribe.”

    As with any consumer survey, the results are open to individual interpretation, but the methodology of the survey itself was sound. It is certainly possible that respondents overstated their ‘connectedness”, but the fact that 11 percent of consumers perceived they had a connection with their financial institution via social media still speaks volumes. Social media is now part of the fabric of people’s daily lives, including their financial lives, and they are talking about their financial experiences and their providers on social sites every day.

    Based on the survey results, we believe that it is important for financial institutions to develop a social media strategy, if they have not done so already, even if that strategy consists of simply listening to the conversation. The financial institutions that get social media right will be well positioned to better understand, communicate and serve their customers. It may take some trial and error to figure out what “right” is, but we believe social media has a role to play in the relationships between financial institutions and consumers in the days ahead.

    Geoff Knapp
    VP, Online Banking & Consumer Insights
    Electronic Banking Services

  13. Hi Geoff,

    Thanks for the comment. To clarify The Financial Brand’s position, there is no issue with the methodology but rather how the survey results were reported. The white paper asserts that “11% are connected,” which is simply not true. Granted, survey participants often misrepresent their actual behaviors and intentions in their responses (e.g., overstating or underestimating), which is something the white paper should have acknowledged. A more accurate way to report the results would have been “11% say they are connected” or “11% believe they have connected.” The findings presented in the white paper make it sound like the study involved hard science with concrete conclusions, when really the study involved a survey with a much, much higher margin of error.

  14. And, most of those connecting to banks on social media are likely to be other banks or vendors, not customers.

  15. Nathan Hastings says:

    Ultimately, the responses that most institutions have will be the same follies that existed around focused media marketing plans for years. Which is to treat it as a panacea to all of the financial institutions flaws in tackling the 15-39 year old audience.

    As a industry professional in this vital market segment, I have seen innovation after innovation around electronic delivery to reach this audience. Yet in all these innovations one thing is pain stakingly clear, that FIs are far to reliant upon eChannel Deliveries (online banking, bill pay, ATM, Mobile Banking, SMS Banking, iBanking, Social Network Banking, etc.) that we will continue to try and suck a watermelon through a straw.

    It’s time to focus these channels towards bringing this audience BACK to our brick and mortar locations. Not for increased transaction volumes but for more ‘fact-time.’ Don’t fool yourself into thinking that through all of their (‘OUR’) electronic communication methods, that we loathe face-to-face contact. They (we) welcome it, on their (our) level.

  16. eDelivery innovations – rather incremental changes – have been instrumental for the banking industry, both in terms product / services innovation as well as increased efficiency.

    However, my personal perspective is that physical branches are no longer thought of as a must for most consumers in the 18 – 60 year age bracket. A 2008 Deloitte study found that ~75% customers visit a bank branch less often than once per month and 20% less often than once per year. This together with the 80/20 rule (20% customers generate 80% of profits) and the assertion that the profitable 20% is much more likely to be in the group that visits a branch less often than once per month indicates that branches are no longer the “glue” that binds customers to banks.

    From most customers’ perspectives, visiting bank branches is not a joyous event (contrary to the belief of most bankers) and most consumers’ goal is to get in and out as fast as possible. If you haven’t already done this, I strongly recommend that everyone sits in the front lobby of any bank for 30min to observe the traffic flow and interaction levels — my findings are that most branches have a) little traffic flow with bank staff substantially outnumbering customers, and b) 95%+ of all interactions are transactional in nature rather than advisory / value added communications which all banks so desire.

    Given this, it is difficult to understand why banks continue to invest in branches and what Bankers believe will change (either in customer behavior or their own approach) to turn branches from extremely negative ROI assets into a value added asset.

    Mega-banks’ approach of building branches makes sense due in part to their strategy of being all-present – being on every block in every community. However, for most other banks, this approach is neither rational nor economically feasible. Community Banks & Credit Unions must develop their own strategy (including actionable activities that support said strategy) to drive growth through differentiation (this is unlikely to include convenience which requires many branches).

    Technology has evolved and continues to evolve so as to break the yesterday’s business models (and most banks are operating on “stale” strategies). No longer can a community bank believe that only those Financial Institutions that are present in a community are its direct competitors. Branches no longer define competitive territory for banks (and credit unions). Just look at the growth of internet only banks such as Ally, ING Direct, EverBank, Amex Bank, Discover Bank, Schwab Bank, eTrade Bank and the list goes on and on. Consider the implications of emerging / expected competitors such as PayPal Bank, Apple Bank, and Google Bank.

    For community banks (and credit unions) to survive, indeed, there must be a very serious re-assessment of business strategy and assessment of go-forward approach. My view is that within the next 5 years, FDIC insured banks will decrease substantially in number, and most of the casualties will be in the community banking sector (and for most, I believe the exits will not be pleasant). Meredith Whitney, an influential banking analyst, recently estimated that banks will cut 5,000 branches in the next 18mo and as many as 10,000 branches by 2015 (this implies 500 Community Banks in the next 18mo and 1,000 Community Banks by 2015 – assuming that 50% of these cuts come from the Community Banking sector and 5 branches / bank).

    However, not all is lost and there are tremendous opportunities for those who are willing to take calculated risks. Banks must re-define who they are, including rethinking their target customer, product / services mix, pricing strategy, marketing channels, customer development strategies, and much more. But what is clear is that banks must do a better job of leveraging internet and the emerging social media channels; rethink the definition of target customer base (especially those who limit their customer base to a specific geography); re-focus from transaction processing to value added services.

  17. Nathan, please (please) read Serge’s last comment. It hits the mark.

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