The point of confluence: Social media meets Banking
As social media continues to grow, and makes its presence felt more and more, the industry thatshould be sitting up and taking note is Banking – a service that touches our lives ubiquitously.The confluence is inevitable; how to exploit to create a competitive advantage is what should be on every marketer's mind. With the growing purchasing power parity of the Indian middle class and growth opportunities acrosssectors, banking in India is on a flourishing note. The banking index has grown at a compounded annual rateof over 51 per cent since April 2001 as against a 27 per cent growth rate in the market index for the sameperiod. Foreign banks are also trying to leverage on this growth run and increasing their footprint in theIndian market.The opportunity to leverage the social media consumers’ online behavior in the context of the bankingindustry, has a high potential and an extremely potent upside.Till today, Indian banks have been through their “aggressive acquisition” phase. However, the key to longterm profitability is retention and increasing profitability of existing customer base. Essentially in this“forming” phase, social media plays a key role in customer engagement by enabling banks to obtainexponential financial value, build strong bonds and cultivate long term profitable customers. This is theline of sight that every marketer needs to have and this whitepaper helps you do exactly that.
How the Big Boys play the game : The global scenario
“As an industry, if you really think about it, banking is about being personal… The fact is their basic aspect is a very personal relationship and social media is a way to enhance that and bring that back, so I think it's a perfect fit.”
- Frank Eliason, Senior Vice President of Social Media For Citibank
Leveraging the social network of its consumers and prospects has become a globally recognized practice of banks. The major players include Wells Fargo, Citi Group, ING and BBVA among others.Bank of America is one of the pioneers in this domain. They launched a dedicated Twitter feed to addresscustomer queries and grievances. Given their strong orientation towards Online Reputation Management,they actively browse the 'Twitterverse' for any negative sentiments to address. It may be helpful to note thatin doing so they don't utilize their bankers' hours. In fact, BoA has a team of five people working full-time tokeep the online conversations going 24 x 7. If you take a look at its tweet history there are plenty of promisingsigns. Wells Fargo has taken things to the next level by creating a Virtual Engagement Platform for socially connecting their prospects and engaging customers.