What Can Financial Institutions Really Expect from Twitter?

The Financial Brand estimates that around 5% of retail banks and 10% of all credit unions are on Twitter. What about the rest? What could they expect if they joined Twitter? How many followers might they they get?

The Financial Brand randomly selected 15 banks and 11 credit unions with active Twitter accounts and looked at how many followers each had relative to its assets, number of customers/members and number of employees.

Banks find followers hard to come by

Banks included in the study had anywhere from a few dozen followers up into the thousands. Assets ranged from $110 million up to $2.3 trillion.

Banks with less than $100 billion in assets saw around one follower for every $14 million in assets. The banks most successful at attracting Twitter followers averaged 1 for every $1 million in assets.

Banks with over $100 billion in assets had one follower for every $209 million in assets. The average for all 15 banks was one follower for every $160 million in assets.

Among big banks — those with over $100 billion in assets — there was only one follower for every 5,212 customers. Less than one quarter-percent (0.021%) of all big bank customers follow their bank on Twitter. That translates to an average of 208 followers for every one million customers.

BofA, the largest bank in the study, had 12,315 followers out of its 55 million customers. Wells Fargo averaged one follower for every 8,635 customers. By comparison, ASB in New Zealand had 2,289 of its one million customers following them on Twitter, or one in every 437 customers.

Relative to staff size, large banks have one Twitter follower for every 25-30 employees. SunTrust, for example, has 1,424 followers and 28,000 employees, or about one 1 in 20. Smaller and medium-sized banks have a staff-to-follower ratio around 3:1, that is one follower for every three employees.

Banks included in the study: BofA, Wells Fargo, Commonwealth (AUS), Westpac (AUS), TD Bank (US), SunTrust, Zions, ASB, Bank of Oklahoma, Bremer Bank, Washington Trust Bank, Northeast Bank, Union National, Monarch Community and Pinnacle Bank S.C.

Credit unions fare better than banks

Credit unions in the study had as few as a couple hundred followers and as many as 2,000. Assets ranged from $46 million up to $11 billion.

Credit unions with over $1 billion in assets saw an average of one Twitter follower for every $5 million in assets, whereas smaller credit unions had one for every $750,00 in assets. The credit unions most successful at attracting followers averaged one for every $200,000 in assets.

Only an average of 0.65% of members are connected to their credit union on Twitter. That’s one follower for every 155 members.

Coast Capital in Canada, with $11 billion in assets and 425,000 members, has been on Twitter for approximately two years. They have 1,485 followers, or one for every 286 members (0.35%).

At less than one-tenth Coast Capital’s size, Advantis Credit Union in Oregon may be considerably smaller, but they have more followers. With only $750 million in assets and 42,000 members, Advantis has amassed over 2,000 followers. That’s roughly one in 20, or 4.9% of its member base.

Credit unions included in the study: Coast Capital, OnPoint, CommunityAmerica, Public Service of Colorado, LA Firemen’s, Unitus, Advantis, Vantage, Verity, Heartland and Star Choice.

What can a financial institution new to Twitter expect?

How many followers might a bank or credit union expect to see if they launched a Twitter account? The short answer is “not many.”

Best case planning scenario for banks considering Twitter:

  • 1 follower for every $1 million in assets
  • 1 follower out of every 200 customers (0.5%)
  • 1 follower for every 2 employees (1:2)

Worst case scenario for banks:

  • 1 follower for every $200 million in assets
  • 1 follower out of every 4,000 customers (0.0025%)
  • 1 follower for ever 50 employees (1:50)

Best case planning scenario for credit unions considering Twitter:

  • 1 follower for every $250,000 in assets
  • 1 follower out of every 25 members (4%)
  • 10 followers for every one employee (10:1)

Worst case scenario for credit unions:

  • 1 follower for every $5 million in assets
  • 1 follower out of every 350 members (0.29%)
  • 1 follower for every one employee (1:1)

Hopefully, you’ll surpass these projections, as some banks and credit unions do.

Keep in mind that The Financial Brand estimates at least 15% of the people following any Twitter account (including @FinancialBrand) are outside your core audience: spam, bots, social media “gurus,” people from other countries, etc.

You’ll have to determine whether there’s value in engaging an audience that will likely total no more than 1% of your existing customer/member base. Financial institutions who provide service and resolve customer issues via Twitter may see significant value, while those hoping to use Twitter as a broadcast or marketing tool might be sorely disappointed.

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  1. Incredible information! Thank you for sharing this. Our rate is about .78%, and we are a small CU.

  2. What is the value of a follower?

    Take a quick look at the smaller FI’s, who is actually following, and it’s mostly industry folks following each other.

  3. You’re absolutely right Rob. The percentage of followers who are (1) customers or (2) potential customers who actually fall within a financial institution’s footprint ranges wildly — usually between “poor” and “practically none.”

    Anyone should be able to create an account that gets 200 followers. The Financial Brand ran a simple test a while ago, creating an account for the fictitious “ABC Bank.” @Your_ABC_Banker has 129 followers and is listed 9 times. All it took was two tweets and following 41 people.

    Someone who is active in Twitter and engages with peers in the financial industry (@ replies, retweets, etc.) should be able to attain 250-500 followers in their first year. Just don’t go out and start following hundreds of people at one time. If you want to build followers, you should do it patiently, and try to keep your followers/following numbers balanced.

  4. A lot of CU twitter followers are other CU’s…I think we’d be happier with a bunch of CU members following us rather than peers.

  5. Kathy Hanbury says:

    I agree it’s interesting data, but like any other data, it’s not very useful without careful analysis. What I’d like to know is how are these FIs actually using twitter? What are they posting? How often? What’s their strategy? Is anyone paying attention to it? In my experience with social media and FIs there is often an initial excitement to get started with social media, but no strategy, guidance, governance, or commitment to ongoing resourcing.

    I can’t see any reason why FIs can’t experience similar successes to other types of organizations.. they just typically have more bureaucracy and red tape to cut through to truly make it successful.

  6. Kathy Hanbury says:

    I agree with you 100%. And I hate the idea of using social media “just because”. But from a content strategy perspective (which is where I come from), this data just leaves me screaming to find out why the numbers are so low. Is it the market? The industry? Or (as I suspect), the poor content and lack of strategy and success criteria?

  7. Interesting data. I think you are trying really hard to prove that twitter is a useless tool – but why focus on the numbers? It’s not about quantity – it’s about quality. I’d rather have 5 engaged followers than 5000 nameless followers. Interesting that your test was based on a ghost account.

    Anyhow – the CU’s and community banks that I know are building relationships – that is – digging deeper one step a time. Some are with actual customers, some with peers. There are many ways to build trust and sales online. You might check out Kyle Lacys’ blog post on the subject: http://kylelacy.com/21-ways-to-build-trust-and-sales-leads-in-social-media/

  8. Hi Bobbie,

    Thanks for the comment.

    You’re absolutely right: quantity means nothing. As the article’s conclusion and other commenters have noted, the quality of each organization’s social media community varies widely. For every bank or credit union with an engaged, local audience, there are at least a dozen others who are only followed by peers, industry insiders, social media gurus, spam bots and other banks/credit unions (usually numbering no more than 250 or so).

    I’ve seen some financial institutions pay consultants to help them drive up their fan/follower counts. It works… as long as you don’t care who these people are and where they’re from.

    The @Your_ABC_Banker account was created for a Twitter report I wrote back in 2009. The account was initially created to illustrate the process and decisions that should go into the creation of a Twitter profile. The report included screen shots of the steps required to build the @Your_ABC_Banker account. The account was not designed as a test, although that is what it has turned into since then. Because I never deleted it, you can get a sense for how many followers a dormant, two-year old account might have. It’s anecdotal, not hard science.

    In that 2009 report, I also explored the use of Twitter as a sales and service tool. I’ve also written at length (here and on other venues) about the value of social media — specifically Twitter – as a peer-networking, B2B and professional development tool.

    The strategic question isn’t, “What is Twitter good for?” The strategic question is, “At what projected rate of penetration does it make sense to pursue a particular project?” Take mobile banking for instance. It’s obvious that there is value in mobile banking. But does a financial institution need to offer it today, right now? Maybe. Probably. It depends on whether the financial institution thinks it makes sense based on a realistic, fact-based prediction that approximately 5% of its customers will initially adopt the technology. Obviously there are other considerations as well, but most initiatives (whether that be mobile banking or Twitter) require performance projections based on peer comparisons before they are given the green light. This study aims to supply senior management at banks and credit unions with objective data they can use in their decision-making process. They may look at this and wonder, “Should I jump into Twitter where I’ll make a difference with 0.75% of my audience? Or should I launch mobile banking, where I’ll satisfy 5% with an additional, sticky service?” Fair questions.

    Ultimately the study is not trying to prove Twitter is either useful or useless. The data is what it is, and it speaks for itself. As the conclusion states, “You’ll have to determine whether there’s value in engaging an audience that will likely total no more than 1% of your existing customer/member base.” Some financial institutions will see tremendous value in serving people, helping them resolve issues, answer their questions and retaining/developing business, no matter how small the audience may be and regardless of the associated cost structure. Other financial institutions — those who aren’t yet on Twitter — may look at these numbers and decide they have more important, more pressing priorities.

  9. Kathy, you’re right: this is just data. But you have to admit at some point — at least in theory — there is a rate of penetration that makes something sound like a silly pursuit. What is that number? Is it 0.10%? Or 0.01%? Or 0.001%?

    The Financial Brand isn’t presenting any number as a cutoff or threshold for financial institutions weighing penetration rates. Some organizations may think 1% is great. Others may think anything less than 10% is a waste of time.

  10. Interesting article and some good numbers. As some of the others have commented, I would ask a similar question is how are these institution are using Twitter – what are they posting and how does it help it’s followers.

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