Digital Relationships in a Virtual World

By Julie Knudson

Relationships are the foundation of community banks, and they are evolving as social media platforms impact how, where and when financial institutions connect with customers. As social media becomes ubiquitous, Billy Beale, president and CEO at Union Bankshares Corporation in Richmond, Va., says the relationship between banks and their customers hasn’t fundamentally changed, but it has taken on a different look.

“You can now use social media to align yourself with a community,” he explains. Beale moderated a panel at ABA’s Annual Convention in Los Angeles, where experts discussed banks’ evolving use of social media and how successful digital strategies lead to better customer engagement.

“We have essentially invited our neighborhoods to be in constant conversation with us,” says Josh Rowland, vice chairman at Kansas City, Mo.-based Lead Bank. He sees social media as a new and better instrument to forge the connections banks have always sought to make with the communities they serve. By engaging with customers through event photos posted on Instagram and local business spotlights on Facebook, Rowland says, “You’ve broken down the barriers that would exist if you didn’t reach beyond the hourly open schedule of the institution and the walls of the bank.”

For organizations unsure about the role social media can play in their customer engagement efforts, Sally Ann Moyer, an associate at Spaeth Communications in Dallas, says, “That’s where their audience is. That’s where the world is going. The community bank that wants to be part of the world in 2015 and into the future needs to get on the train or get left behind.”

And while millennials are often seen as the barometer for use of online platforms, the demographics of those embracing social media are much broader. Statistics gathered by the Pew Research Center showed seniors’ use of Facebook, for example, grew from 35 percent in 2012 to 56 percent in late 2014. Moyer says social media has begun to replace the phone and even email for an increasing number of people. “In consumers’ minds, it has become the most direct line of contact,” she adds.

Mobility is a big part of social media. Smartphones in particular are always within reach, with people shopping, texting and checking social media feeds at all hours. “In many ways, the mobile phone is becoming the de facto storefront for banks, in that you can use it now to check balances, make payments and activate deposits,” says Jerry Canning, head of financial services at Facebook. “All those things can be done on a mobile device.”

Banks continue to maintain robust websites, of course, but many are supplementing them with interactive Facebook pages, Twitter feeds, Instagram accounts and other social media channels where followers are free to make comments and ask questions. “They call it social for a reason,” Canning says of the two-way dialogue that forms a valuable launching pad for building deeper relationships with customers.

But by initiating the conversation, banks need to acknowledge that not everything happening online is positive. Complaints or criticisms may be posted occasionally, neither of which is the end of the world if handled correctly. “I’ve seen some banks where, instead of addressing them, they delete the comments,” says Patricia A. Husic, president and CEO at Centric Financial Corporation in Harrisburg, Pa.

Removing unflattering posts is perhaps the worst strategy a bank can employ. Instead, offering to discuss and fix the problem keeps the conversation going and demonstrates the institution’s dedication to service. “Let them know you’re happy to talk over their concerns or challenges help them get a resolution,” Husic says. “Nobody wants to be ignored.” Banks that deal with online complaints promptly and tactfully may even see other posters chiming in with positive experiences as a counterpoint, reinforcing the community nature of social media and extending the conversation with customers.

Best practices to keep customers engaged
Before launching a full-blown social media presence, developing clear and concise guidelines around the institution’s online practices is strongly encouraged. “You need a social media policy that outlines who in the bank communicates on behalf of the institution and who doesn’t,” Beale says.

Inquiries made on social media shouldn’t necessarily be addressed by the first person who sees them. Instead, authorized spokespeople—typically more than one individual to ensure adequate coverage for vacations and emergencies—should craft the appropriate responses for posting.

Preparing for events that are out of the ordinary is a good way to ensure that everyone involved in managing the institution’s social media channels knows what to do when the unexpected happens. “Run through any crisis scenario you can think of,” Moyer says. The team can then determine who will best serve as a point of contact (the person selected may change depending on the nature of the situation) and what type of response they want to provide.

“If you have that outlined ahead of time, it will save you many headaches and trouble,” Moyer says. Taking the time to do a couple of dry runs will help identify potential glitches, such as a spokesperson who doesn’t have the password to the bank’s social media management platform.

In addition to identifying who will publish content to the bank’s online feeds, Husic says it’s also important to craft a strategy that covers the type of topics to be posted. Centric Bank, for example, has chosen to avoid advertising on its social media platforms.

“We use the space solely to tout things that individuals and members of our bank participate in within our community,” Husic explains. “We’ve not used it as a channel to sell.” If a client has received recognition or awards, or if the institution gets some great press about its volunteer efforts, those often appear as social media content. Husic says her bank also uses its online feeds for recruiting, an approach that has been successful for the organization.

As banks create their own digital game plans, Rowland stresses that social media isn’t about having one-way conversations.

“This is not my chance to scream through the Internet how great my bank is,” he says. Rowland surmises that people already wade through too much advertising as it is. Adding to the volume likely won’t help a bank stand out in a positive way.

“What people want to know in social media is who you are,” he explains. What activities does the bank focus on? Which issues does it care about? “Because we’re so grounded in our neighborhoods—and this is where the strength of the community bank is—we have a unique platform to advocate for the businesses and the clients we see every day,” Rowland says. Rather than telling their own stories, he encourages banks to tell the stories of their communities.

One thing Canning says banks should avoid is allowing social media feeds to become boring or—even worse—static. “We would recommend committing to some level of content creation, because at end of day, we can all put up a page with information, but it has to pass the sniff test,” he explains. If an online channel continues to have just the same basic elements, customers are unlikely to engage with it over the long term. Standard information, such as branch locations and hours, should be included, but they need to be regularly complemented by new content. “Give visitors a reason to keep coming back,” Canning says.