Banks have been around for centuries, whereas social media has only existed for a little over a decade. So it’s no surprise that the two have not always intersected.Â
However, in recent years social media has become an increasingly useful tool for banks.
In this blog post, we will discuss how banks can use social media to their advantage. We’ll look at the different ways social media can be used to engage customers, build relationships, and promote products or services. We’ll also explore some of the challenges of using social media for banks.
Perhaps the most important reason is that social media provides a way to build relationships with customers.
Nowadays, when there are so many choices for banking products and services, customer loyalty is no longer a given. In the past, banks typically communicated with their customers through advertising, calls, and direct mailings. Thanks to social media, banks can now engage in two-way conversations with their clients. This allows them to give feedback to the banks about their wants and needs.
It is also possible to use social media for promotion without being invasive. Such platforms make it easier for banks to keep their customers informed about new products and services. Banks can capture their target audience this way and focus their promotions to specific groups of customers on social media.
For example, if a bank is launching a new savings account, they can target their promotion to customers who have expressed an interest in saving money.
How social media is used in the banking sector is a topic of much debate.
Some banks believe that social media should just be used for customer service purposes, while others only leverage it to drive sales and increase profits. While some banks choose to be active on a single platform, others embrace the concept of omnichannel marketing.
There is no one-size-fits-all approach to fit, but there are some ways that banks can use social media to their advantage regardless of which side of the debate you fall on:
And that’s just to name a few.
Social media can be an excellent tool for banks, but it does not come without its challenges.
Because social media is still a relatively new phenomenon, many banks have yet to develop social media policies. It can thus be difficult for them to know what is and is not acceptable for employees to post on social media, or how to run social media profiles in general.
Moreover, social media policies can vary from country to country. This makes things even more complicated, especially in the case of larger, multinational banks.
Social media is public, so it provides a perfect way for customers to voice their displeasure with a bank’s products or services. It goes without saying that negative feedback can damage a bank’s reputation if not handled properly. That being said, banks need to have a plan in place for how to deal with negative comments and address complaints.
There is always the risk that customer data could be hacked or leaked via social media. This is a serious concern for banks because it may lead to identity theft or other financial crimes.
To protect their customers’ data, banks need to have strong security measures in place. They also need to make sure their customers don’t share sensitive data (e.g. card numbers) on the bank’s social media channels, as they won’t be secure.
In the event of a crisis, social media can be a double-edged sword for banks.
On one hand, social media helps banks to quickly and easily disseminate information about the crisis. On the other hand, social media also provides a platform for people to express their frustration with how the bank is handling the crisis or operating in general, which can lead to more negative publicity.
As a result, it’s important for banks to prepare themselves for crisis situations that may arise on social media before they occur.
There are a number of legal restrictions that banks need to consider when using social media. For example, banks are not allowed to share certain types of information about their customers (e.g. their credit scores).
Additionally, there are a number of regulations that banks need to comply with when it comes to advertising and marketing on social media. In some countries, a digital imprint is required for social media ads. In others, some banking products like payday loans or cash loans are not allowed to be advertised on social media.
Banks need to be aware of such legal restrictions and make sure they are fully compliant with them.
Take some time to think about your goals. What do you want to achieve with social media? Do you want to use it for customer service, to generate leads, or for building brand awareness? Once you’ve identified your objectives, you can create a social media strategy that will help you accomplish them and set your social media KPIs.
Consider which platforms your target audience is using and make sure you have a presence there. Sometimes, it’s better to start small and make sure that you choose the right social media platform for your audience. Start with one or two platforms instead of trying to accommodate all of them straight away.
You should use:
Encouragement for trying Pinterest? Bank of America, one of the world’s largest banks, has over 9 thousand followers on Pinterest and attracts more than 10 million monthly views on its Pins. Not too bad, right?
Always pay attention to what social media platforms your audience spends the most time on. If you feel like you need to expand or want some inspiration, we created a list of the best social media platforms for 2022.
When creating your bank’s social media profiles, ensure they are attractive and easy to navigate. Make sure your branding matches the rest of your marketing materials and use high-quality images.
You should add to your profiles:
Your social media profile is often the first thing people will see when they come across your bank on social media, so you want to be sure that it makes a good impression.
As we mentioned before, social media policies can help banks navigate social media challenges. Banks should therefore develop social media policies covering a wide range of topics.
There are a number of things that could be included in such a policy:
Social media policies should be reviewed and updated on a regular basis.
Banks should provide training to their employees on how to use social media responsibly. This training should cover a variety of aspects, including:
With a social media policy and proper training in place, banks can minimize the risks of social media and use it to their advantage instead.
Halifax / Bank of Scotland uses templates on their Facebook profile so their employees can respond to many different queries and questions:
For compliance and risk purposes, banks should monitor social media on a daily basis. This includes keeping an eye on:
Banks can be aware of the risks and take the necessary steps to mitigate them thanks to social media monitoring. With social listening, banks can also take advantage of social media to understand their customers better, as we’ll get to later.
Whether it’s social media posts, comments on them, or private messages, banks should answer customer inquiries as soon as possible. A rule of thumb here is to respond within 24 hours, however, with social media platforms like Twitter, it’s often best to respond in real time.
Banks should also have a social media customer service plan in place, including:
By providing prompt and courteous responses to social media inquiries, banks can provide a positive customer experience and build brand loyalty. They can show that they are responsive to their customers’ needs and that they care about the bank’s reputation.
This is useful not only in the case of negative sentiment but also to show potential new customers that the bank is trustworthy. If a particular bank is responsive in terms of regular questions or complaints, it’s likely that they will also be prompt to address any major issues or bugs.
Social media can make or break banks, which need to be more active online than ever before in today’s social media-driven world. But what does that mean?
For banks, social media is about building relationships with customers. It’s an opportunity to connect with customers on a more personal level and create connections that go beyond financial transactions.
Here are some ways in which banks can use social media to build long-term relationships with customers:
Citibank’s social media profiles remain open for feedback and contact:
With social listening, banks can track mentions of their brand, product, or service and better understand their audiences.
Banks can use social listening to:
It goes without saying that social media for the banking industry poses many challenges, yet it can be used to their advantage. By being responsive, engaging, and human, banks can use social media to build long-term relationships with customers. The right social media strategy can help banks understand their customers better and improve the overall customer experience that they provide.
Go and get social – your bank’s future and success may depend on it.
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