ASB, one of the biggest banks in New Zealand, is taking a page straight out of Groupon’s playbook and adding a lottery twist. It’s a first in the banking industry, and one of the most innovative ideas to come out of the social space this year.
Every Wednesday for four weeks, ASB’s “Like Loan” will give Facebook users the opportunity to win a special home loan rate. Four lucky winners will be selected to receive a reduced fixed-rate home loan based on the number of Facebook ‘Likes’ accumulated on the promotional app that day.
ASB’s Facebook page had 66,940 ‘Likes’ before launching its “Like Loan.” They added nearly 6,000 more — roughly 9% growth — after the promo launched. That helped drive the first week’s “Like Loan” rate down to 2.4732%, well below ASB’s regular advertised mortgage rate of 5.19%.
The promotion generated buzz on Facebook, with 6,387 users talking about it. ASB says more than 800 Facebook users shared the “Like Loan” app with their friends on the first day of the promotion.
( Read More: Customers Chat One-to-One in ASB’s Virtual Facebook Branch )
( See More: Hello… I’m the New ASB! )
An Innovative Facebook Breakthrough
ASB is doing three things that very few other banks or credit unions do:
1. They are using social media to market/promote banking products.
2. They are giving tangible benefits to fans for their Facebook activity.
3. Their giveaway has financial relevance.
ASB shirks the advice of social media consultants who swear it’s a sin to push products on Facebook or Twitter. Phooey to that, ASB says.
And why does it seem most Facebook giveaways in the financial sector have nothing to do with banking? Fans might be able to win concert tickets for a trivia question or pet photo contest, but what’s that have to do with banking? Nada.
Key Question: If you aren’t supposed to spend time marketing yourself on Facebook, then what good is it?
You most certainly can use social channels to sell stuff. You just can’t do it with lame ham-handedness — e.g., “Check out our loan rates this week at thebank.com.” That kind of marketing white noise lacks style, character and creativity. Don’t bother.
This is precisely what makes ASB’s “Like Loan” promotion so unique. ASB is believed to be the first banking institution to create a direct and immediate connection between people’s social media engagement (Facebook ‘Likes’) and a financial product of strategic importance (home loans) by using a relevant incentive (lower loan rate).
It’s certainly an intriguing concept — rewarding Facebook likes with better rates. But why did ASB decide to only award the Facebook home loan rate to four fans instead of all of them?
Social media commentator David Slack says the giveaway is fantastic… for a few lucky winners. “But it means that everybody else is roped into it to do the marketing for ASB for nothing by sharing the buzz around,” he says. (To be clear, Slack thinks ASB’s campaign is very clever.)
And what if the four people selected decide they don’t even want a home loan? Then fans might complain that the “Like Loan” promo was little more than a marketing charade.
( Read More: ASB Launches Mobile Facebook Payments )
Analysis & Takeaways
The new social media landscape does not supplant traditional business concepts — ideas like sales, profits, account acquisition, cross-selling, retention. These things still matter. You always need to be looking for ways to integrate social media into sales campaigns, and the other way around. Ask how you could use Facebook in a product promotion to yield more loans. Look for opportunities to create those product tie-ins in all your social media projects.
Reality Check: There’s one simple reason social media struggles to establish any kind of ROI… You get 0% of the sales you don’t ask for. If you don’t promote your products in social channels, then of course you won’t have any bottom-line results to show for your effort.