An ABA Research Study
ABA recently conducted a nationwide survey of 780 banks of all sizes to find out how they are managing social media programs. What are the results banks have seen from their efforts so far? What do they wish they could do better? And what are the opportunities and challenges they see on the horizon? The final report, The State of Social Media in Banking, generated a wealth of data—some of it quite unexpected.
How are banks currently using social media?
Surprisingly, more than one-quarter of respondents said their banks had no plans to use social media for monitoring customer complaints, providing customer service, or recruiting—areas where other banks are seeing significant success.
When asked to rank from 1 to 10 the reasons why banks use social media, topping the list was community engagement, followed by the desire to deepen existing customer relationships by providing such content as financial tips and updates on new products or services. Banks have largely steered clear of advertising due to concerns about regulatory compliance.
To find out what’s at play here, we interviewed social media leaders across the banking industry for more detail on their social media use. Here’s what they told us about these five approaches.
1. Social media for community engagement.
Jill Castilla, president and CEO of Citizens Bank of Edmund, Edmond, Oklahoma, is one of banking’s foremost practitioners of social media. She noted that, “It’s like going to a million chamber of commerce events and shaking everyone’s hand.”
In 2014, Citizens Bank of Edmond started a street festival called “Heard on Hurd,” every third Saturday from March through October. “That’s when we ramped up our use of Instagram and the hashtag #jointhehurd, where attendees can share their photos of the event, which amplifies the awareness,” said Castilla.
“It’s really like a bank customer appreciation day—planned and run by bank staff—with live music, three dozen food trucks, three dozen pop-up shops to show the bank’s support for small business and how the bank can help build community. We take no sponsorship for this event and do very little advertising, yet it has grown organically into an event we can hardly believe.” The bank keeps a modest profile at Heard on Hurd, preferring to showcase the community. And the community is loving it. The bank anticipated 300 to 500 attendees at their first block party. They got 3,000. The summer 2016 events each drew 20,000 to 30,000 people.
Likewise, TheBANK of Edwardsville in Edwardsville, Illinois has elevated community engagement on social media to an art form. Scroll through the bank’s Facebook feed for just 60 days and you’ll see—among many other things—posts about:
- Employees volunteering at an annual chili cook-off
- Taking the ALS ice bucket challenge
- Participating in a food pantry fundraiser
- Running a 5K to raise money for a sports foundation
- Hand-delivering school supplies to a high school
- Grilling burgers at the annual Troy Family Festival of Fun to benefit the local VFW post
- Participating in a benefit lunch to support the Special Olympics.
If you lived anywhere near Edwardsville and you hadn’t heard of TheBANK, one look at this Facebook page would give a clear impression of community-mindedness and explain why the number of page likes is equivalent to 10% of the city’s population.
2. Social media for deepening customer relationships.
The medium holds great potential for building the business. Each quarter, First State Bank, headquartered in Gothenburg, Nebraska, holds a contest with a local business customer where they each promote the other’s business through paid social media. “For one contest, we partnered with a local sports bar in town,” said bank vice president Derek Randecker. “All of a sudden, we have 3,000 followers on our Facebook page hearing about the sports bar and 15,000 of their followers learning about First State Bank.” The feedback from their business customers has been incredible because they see the bank’s paid social media as investment in helping them raise awareness with consumers.
Ryan Bell, chief product officer and chief technology officer of Gremlin Social, recommends a social media presence that strikes the right balance of content around fun, financial dreams, financial education, and personal finance. He suggests banks share original content as well as industry content, and that they educate, engage, and promote products in ways that serve rather than are self-serving.
3. Social media for recruiting.
Facebook, Twitter, and LinkedIn have proven to be valuable platforms for finding qualified job candidates, especially if social media represents the institution as a great place to work.
We built an #AvidiaLife feed that shows a behind-the-scenes view of everything that goes on at the bank and have been able to use it to acquire new talent by showing what our corporate culture is like,” said CarrieAnne Cormier, vice president for retail operations and strategy at Hudson, Massachusetts-based Avidia Bank. “We have actually had people who have reached out to us that want to work here because of what they have seen online.”
Oconomowoc, Wisconsin’s First Bank Financial Centre has found similar success. “We are growing significantly here, and our HR department was having a hard time keeping up and finding the right candidates for the right positions,” said Jeff McCarthy, the bank’s vice president of marketing. “So we started partnering with HR, boosting some posts on Facebook [for the HR team]and featuring a job-of-the-week opportunity. The last one we did, we spent about $50 to boost a post and reached about 14,000 people who generated about 500 comments and shares—and this is a bank that has about 1,200 followers. More than 300 people actually clicked on the post to find out more about the position. So for us, that’s a really powerful tool to help find qualified job candidates.”
4. Social media to attract new customers.
“In the last year, we’ve gotten about 3,400 visitors linking to our website from social media,” said McCarthy. “About one-third of those were first-time visitors to our site, so we’re exposing new people to our brand. Of those, eight people applied for a loan. We do believe social media is starting to be a business generator for the bank and will continue to be so as time goes on.”
Banks can bring in visitors by showcasing their lighter side. For example:
- First Bank Financial Centre’s “Where’s Mark Wednesday” feature on Facebook has made its CEO Mark Mohr something of a celebrity. Each week a bobblehead figure of Mohr pops up somewhere in the world—and the first person to correctly guess the location wins a $10 gift card. “This fun contest has humanized our bank,” McCarthy said. “It has been a real win for us.”
- When the Pokémon Go craze broke in July 2016, Citizens Bank of Edmond hosted PokéStops with free water and a giveaway contest. Users could snap a photo of a Pokémon, tag the bank on social media, and show it to a banker to get a free gift card to a local café.
New visitors who come for contests or promotions might stay for a closer look at what the organization has to offer financially.
Banks have also had success using social media to establish new business relationships. Avidia actively looks for opportunities to cross-promote local businesses through social media. “We have businesses that want to partner or bank with us because we’re sharing their story,” said Cormier. We have a cool group of restaurants near us that are new “startups” asking if we can come to their grand opening or an event. Places are choosing to bank with us because we’re not going there to do a business call but going to these businesses to highlight what they are doing in the community.”
5. Social media for customer service.
Some banks fear a social media presence will give customers a high-profile platform to complain. What if someone posts something negative?
“View it as an opportunity,” said McCarthy. “For instance, somebody posted a complaint that we didn’t have a branch near them, that it’s such a drive to get to our headquarters. We used that complaint as an opportunity to talk about mobile banking and mobile check deposit.” He added, “We don’t delete those posts; we address them as quickly as we can. Those negative posts can almost be more helpful than the positive ones, if you handle them correctly.”
Castilla agrees. “In every case we’ve been involved with, the complainers—even the greatest complainers on social media—have turned into advocates for us. They’re the first ones to jump in and advocate to the other complainers. Those who were previously the detractors are now building up the business to a different level that you couldn’t do with traditional marketing.”
According to a report by NM Insight, nearly half (47%) of U.S. social media users today actively seek customer service through social media and 33% of respondents say they’d recommend a brand that offered a quick but ineffective response. “When a disgruntled customer gets a personal contact from the bank’s CEO, they’re impressed,” said Castilla.
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