CBA gets Social...

I have at times had a crack at the banks and their marketing departments and how they seem to get it wrong.

To beat up a bank is easy – like taking a toy from a kitten – anyone and everyone does it.  The hard thing is to congratulate them on a smart choice, and for this I must clear my throat and say “WELL DONE COMMONWEALTH BANK”

After spending 5 months searching the CBA has appointed its first Social Marketing Manager. This is a very smart move, especially in light of the Westpac Banana fiasco.

The new champion of social media at CBA is Niki Epstein, who was an expat Australian living and working in the US but has since moved to Sydney after leaving a digital marketing role at A&E Television Networks based in New York. Before that she was Promotions Manager at Shock DVD.

As a CBA spokesperson put it, Niki will develop strategies that will allow the bank to “engage with customers that are already engaged in social media to improve customer satisfaction and online brand presence,”

‘Word of finger’ has replaced ‘word of mouth’

Last month Datamonitor produced a report in which it concludes that UK traditional banks need to recognise the value of social media if they are to keep their grip on customers in the thawing economic climate. They suggest that the rise of social media has facilitated a fundamental shift in power from banks to consumers.

To back this up their research suggests that 50% of UK consumers are using a variety of online tools to make their financial decision compared to 41% globally and that ‘online media’ is most popular amongst the 25-34 year old segment.

They do cite that this is in all regions except APAC (Australia, Singapore and Japan)where we know the segment is a lot older, which gives rise to even more importance as far as the big four here in Australia are concerned. Yes – Social media is no longer the reserve of the younger generation. Nielsens 2010 Social media Report has outlined that 35 to 49-year-olds are the fastest adopters of “member communities”.

And while we are talking about “member communities” (which comprises of social networks and blogs), they have overtaken email to become the fourth most popular online category according to the same Nielsen report.

The last highlight from the report that I wish to point out is the most critical for the banks – 9 out of 10 Australian Internet users rely on social media for opinions and information about products, services and brands – ‘Word of finger’ has replaced ‘word of mouth’

How should banks use Social Media

They guys at Mashable wrote a great article on this in August last year outlining 5 ways US banks are optimising this new communications frontier. They were;

1. Community Building – not using it to “sell” anything, but instead utilise social media as a way to build upon the community-minded philosophy that they (the banks) have spent years developing;
2. Product Research- Whether you’re crowdsourcing to find out what customers think of your services or using social media as one tool in your arsenal to enlist customers to help develop new products, a social network is an undeniably powerful research and development resource;
3. Customer Service – real-time search can be helpful in addressing problems with customers while the various tools available can help in engaging with bank customers over social media channels about their products;
4. Marketing & Promotion – What many banks thought it was all about (i.e. forgetting the other four items in this list);
5. Transparency- social media can allow the banks to be more transparent by allowing key staff, such as a bank executive, answering questions directly on a blog, or via a facebook group or fan base.

So…again…congratulations to the CBA. Unlike most banks who have ocassionally muttered the words “social networks” in the odd marketing presentation, the CBA has demonstrated that they wish to make a significant investment in social media.

Maybe they are different after all…