1. Social Media in Financial Services: Building a Winning Strategy
Report Details:
Published:October 2012
No. of Pages: 58
Price: Single User License – US$3450
Early pioneers have demonstrated the enormous benefits that can be gleaned from using social
media to the rest of the financial services industry. Providers are becoming increasingly
sophisticated in their utilization of social media. It is changing the way providers interact with their
customers, impacting every area of the customer experience from marketing to customer service
to brand building.
Features and benefits
•Discover how to make the most of the opportunities offered by social media.
•Sculpt future strategies by harnessing lessons from best practice examples.
•Understand how your organization can be internally structured to use social media.
•Prepare today for the challenges social media will bring tomorrow.
•Keep ahead of the curve by learning how your competitors are using social media.
Highlights
Building an effective operational structure of social media within the organization is necessary to
harness the benefits of social media. Consumer use of social media within financial service is
growing quickly which means that providers must build sustainable, scalable social programs.
Social media big data analytics offers a rich source of insight into customers which providers
utilize to deliver more targeted marketing which has a higher chance of leading to up-selling,
cross-selling, and new customer acquisition. It can also be used to locate dissatisfied customers
and proactively address their concerns.
Crowdsourcing, customer reviews, and interaction between providers and customers on social
media offer a means to be open, inclusive, and customer-centric. Social media shows customers
that the provider is listening and responding to what they are saying. This helps to restore
consumer confidence that has recently been lost in providers.
Your key questions answered
•How can providers seize the opportunities in using social media in their marketing, customer
service, product innovation, and brand building?
•What changes need to be made to social media operations within your organization?
•What is the untapped potential of social media in financial services?
•Which providers are being innovative and pioneering the use of social media in financial
services?

2. •What is the future of social media use in financial services?
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Major points covered in Table of Contents of this report include
Table of Contents
OVERVIEW
Catalyst
Summary
Methodology
INTRODUCTION
The use of social media continues to grow as consumer appetite shows no sign of slowing
There is growing acceptance of the importance of social media among providers
Most financial services providers have not utilized social media to its full potential
The use of social media has become more sophisticated
Social media makes marketing more effective through better targeting
Improved customer service is delivered by responding to consumer needs
Crowdsourcing and customer feedback drive innovation and build trust
Providers increase brand value by engaging with customers
Providers should choose an internal social media model that suits their objectives
STRATEGIC CONTEXT
Social media makes marketing more effective
Marketers use social media to reach more customers
Engaging marketing content is essential to attract consumer attention
Providers use customers' social media profiles for smarter marketing
Social media raises the profile of low visibility services
Effective marketing generates leads for acquiring new customers
Social media delivers better customer service
Social media amplifies the benefits of customer service
Social media is a convenient channel through which to offer customer service
Customer service issues are resolved before they become complaints
Social media anticipates future customer service issues
Social media improves customer service as an effective crisis management tool
Social media informs and educates customers
Crowdsourcing and customer feedback fosters innovation and increases transparency
Customer-generated ideas cultivate innovation and strengthen the provider-customer relationship
Customer involvement increases the transparency of services
Consumer-generated reviews increase consumer trust in the provider
Social media builds brand value through greater engagement
Providers engage customers with their brand by demonstrating individuality

3. Social media interaction engages hard to reach customers
Providers tailor their brand identity to target a specific audience
Brand value is increased by engaging the local community
Providers boost brand value by engaging in non-financial services campaigns
STRATEGY IN FOCUS
Providers must first build an effective internal social media structure
Market trends prompt providers to start using social media
Providers have a choice of a number of different internal structuring models
Financial services providers tend to favor the Centralized model because it maintains control
Committed providers need to adopt the Hub and Spoke model in order to scale their social efforts
A Multiple Hub and Spoke model is necessary for large multinational providers
Providers should choose the model that best suits their social media objectives
Providers will face a number of obstacles in implementing a social media program
Changing between internal models brings challenges
Providers will use social media for smarter marketing
Providers will use big data analysis for improved targeted marketing
Providers need to consider that some consumers will dislike big data-based marketing
Geolocation-based marketing will become more prevalent
Marketers will target customers with high levels of social connections
Marketing emphasis will shift from “push” to “pull”
Marketing will have to cut through brand "noise" to engage with customers
Providers will adjust their strategy to engage customers on visual-based social platforms
Providers need to be aware of the limitations of social media marketing
Customer service will improve by responding to customer needs
Providers must train customer service agents to act effectively during crisis management events
Premature crisis management will weaken the provider's brand
Providers must empower customer service staff to respond effectively
Social media necessitates a "single view" of the customer
Convenience and compliance must be addressed equally
Providers must be able to scale their social communications in response to rising demand
Crowdsourcing and customer feedback have a more tangible impact on services
Providers will alter product features in accordance with customer sentiment analysis
More financial services providers will adopt customer ratings to build consumer confidence
Customer interaction will have a more tangible impact in fostering continued engagement
Providers will look toward fully socially designed products to empower consumers
Providers will build brand value through customer advocacy
Providers will increase their social media efforts on forums to generate brand advocates
More providers will use crowdsourcing to increase brand reputation
Providers will attempt to get key influencers to become advocates of the brand
Providers will seek to strengthen the brand by catering to stakeholders other than customers
APPENDIX
Methodology

4. Secondary sources
Further reading
Ask the analyst
Disclaimer
List of Figures
Figure: The usage of social media has grown
Figure: Twitter is favored for customer service while Facebook and YouTube are preferred for
marketing and brand building
Figure: Chase has a Facebook page dedicated to promoting its Freedom credit card
Figure: HSBC encourages students to upload their own videos on HSBC's Facebook page
Figure: American Express uses customers' social media profiles to offer personalized offers
Figure: Providers are using social media to promote products consumers might not otherwise be
aware of
Figure: ANZ has used Facebook to acquire new customers moving to Australia
Figure: The majority of global retail banks offer customer service on Twitter
Figure: An effective social media response to a service failure can gain positive responses from
consumers
Figure: The Commbank blog offers information and advice for consumers and commercial clients
Figure: Crowdsourcing portals are mostly offered by smaller or regional financial services
providers
Figure: Barclaycard Ring increases transparency by opening up the program's financial
statements
Figure: USAA's rating system inspires consumer confidence with its transparency
Figure: RB Jacobs provides a consistent experience for FNB customers
Figure: Chase creates a more personalized feel by displaying its customer service team
Figure: American Express has strengthened its links to small businesses with the Small Business
Saturday campaign
Figure: Umpqua's social media strategy reflects its "community bank" brand identity
Figure: Scotiabank encourages consumers to share what is important to them for charity
Figure: There are various ways providers can organize social media within the corporation
Figure: Each internal model of social media usage has pros and cons
Figure: Breaking down silos will be an important challenge to fostering collaboration
Figure: ANZ delivers effective customer service by responding to tweets directed at other ANZ
twitter handles
Figure: Social media needs to be incorporated into a single view of the customer
Figure: Santander is not using social media to its full potential
Figure: Fidor Bank empowers its customers to affect the interest rate the bank offers
Figure: Wells Fargo is a rare example of a provider utilizing forums to generate advocacy
Figure: HSBC's newsroom is dedicated to journalists and bloggers
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