Saturday, October 10, 2009

What Bankers and Willie Sutton Have in Common in 2009

If you've been a banker for any extent of time chances are you've heard his name - or at least his quote. Willie Sutton was a career bank robber who held up over 100 banks from the 1920s to the 1950s (final arrest in 1952). As the story goes, after being arrested Willie was asked why he did it..."because that's where the money is."



So what does Willie Sutton have to do with social media?

On September 21, 2009, comScore Media Matrix released its rankings of the top 50 U.S. Web properties for August 2009. According to comScore, Facebook came in at 5th place with 92.2 million unique visitors - a five percent increase from July 2009. Twitter came in at 46th place with 20.8 million unique visitors.

So, let me ask it again...what does Willie Sutton have to do with social media? If Willie were alive today, he'd probably say, "because that's where the money is."

That's right. The money. Banks, and businesses in general, need to consider how to best utilize social media to develop their businesses - from customer service to reputation risk management to sales and marketing. And by doing all these things well, banks will find a route to new found treasure.

But, of course, social media is NOT the same as Web or email marketing. Social media is much more complicated and brings with it a whole new set of nuances that set it apart from traditional online marketing. In a nutshell, the nuances involve honest, transparent and ongoing conversations with the "community." This post does not cover those nuances in detail but is intended to get bankers thinking about the potential for the use of social media; to get bankers to think about where to find the money (without having to hold up a competitor!). I recommend the ebook Community Banker's Guide to Social Network Marketing for a detailed description of the nuances.

I recently read a post by Richard Pentin where he stated that the honeymoon over social media is over. While I respect Mr. Pentin's view, from the banking industries point of view, he could not be further from the truth. As a banker it hurts me to say that we tend to be far behind the innovation curve. So while the rest of the world has been neck deep in social media over the past two years, bankers are just now starting to get their arms around it. As such, from a banker's perspective, the honeymoon is just beginning. And with bankers' current and potential customers increasing jumping onto Facebook and Twitter and other social platforms at increasing rates, bankers need to figure out how to continue to meet the demands of the evolving consumer as well as how to use those evolving technologies to secure additional business.

What is another reason bankers consider social media? Well, to quote another controversial historical figure, former President Bill Clinton, "It's The Economy Stupid." As the economy continues to struggle, consumers have become more critical of the banking industry. With TARP, AIG, Lehman Bros., et al, bankers have taken a hit from a reputational perspective. Social media can assist in healing those wounds through the honest and transparent approach required by social media.

I could go on and on but I really think that the next step requires a thorough reading of the Community Banker's Guide to Social Network Marketing. Then we can come back and fill in the gaps.

4 comments:

  1. Very interesting view on social communications in the banking community.

    I've been providing creative and marketing communication solutions for financial institutions for years and you're right, social media has been a hang up in many cases. It started with online security and regulatory issues (which continue to be sort of a show-stopper with smaller banks) and the bad press they fear from the instability of the housing and financial markets.

    The reality is that most banks don't want to be transparent. It's easier to push products and services and save customers and prospects money—helps them forget about the "big, bad banks" that are out to get them!

    Anyway, thanks for the read. You can link up with me at: http://www.imagineme.net/blog

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  2. Hello,
    Nice blog i like
    The internet has seen a great deal of evolution from when it first started. From being a mere avenue for data processing and connectivity, it has quickly gained a knack for being socially oriented, creating a multi community rather than just simply being a data transfer protocol. Businesses have emerged within the virtual universe as social media marketing companies.

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  3. Great intro!

    As for Banks and social media, I have seen a sharp increase in the number of people who publicly express their Bank related frustrations on sites such as Twitter. For example, search for "bank hate" on Twitter and you may (typically) find 20-30 Tweets from frustrated customers. I wondered whether Banks, identified in these Tweets, would responded to the frustrated customers -- so I conducted a simple study.

    Of a 100 Tweet sample, I found 75% were one-sided (Bank did not engage customer) and 25% involved back-and-forth correspondence between the identified Bank and frustrated customer. In this study, Bank of America (@help_bofa) appeared to be the most responsive 'Tweeted Bank' with (what appeared to be) a 5 person Twitter Task-force to engage frustrated customers.

    Based on my findings, I believe Banks are likely to embrace social media for "reputation risk management" more than anything else.

    Josh
    SpotBanks.com

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  4. I read lot of articles and really like this article. This information is definitely useful for everyone in daily life. Fantastic job.

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