Friday, December 30, 2011

Social Media-Based Brand Ambassadors - Part 1


[This post is part 1 in a series of posts related to Social Media-Based Brand Ambassadors.  This post introduces the concept of social media-enabled brand ambassadors and sets the tone for the series of posts that will follow.]

We’ve heard it hundreds, maybe thousands of times – “Our employees are our greatest asset.”  When it comes to business-speak, this phrase has become one of the most overused expressions in the trade.  From annual reports to media interviews to company rah-rah events, these words always find a way to make themselves at home.  Yet no matter how trite we believe the phrase to be, it is true.  There is no denying that in business there is little that can be done without human capital.  That’s because regardless of technological advancements or an organization’s name, size, products, or services, people buy from people!  This point is especially critical in the post-Occupy Wall Street era where humanity, honesty, and transparency have become the new expectation for business.

Many organizations have known for a long time of the value that is created by employees that evangelize on behalf of the organization.  These employees are commonly referred to as brand ambassadors.  Research and surveys have repeatedly found that brand ambassadors boost an organization’s reputation resulting in improved profitability.  As a result of their excitement, knowledge, loyalty, and commitment to the organization and its products and services, brand ambassadors create excitement and loyalty among customers.  As such, brand ambassadors act as incredibly effective influencers.  More effective than the best advertising. 

An excellent representation of the ideal brand ambassador is “Flo,” the customer service representative in Progressive Insurance commercials.  Flo is so effective that current commercials portray her luring to Progressive Insurance executives from a competing insurance company.  This is the employee brand ambassador concept at its best.  According to a Business Courier article by Ric Sweeney (“Brand Ambassadors’ Give Your Business A Boost”) “All employees, regardless of function or title, are key ambassadors for your company’s products and services.  Once motivated by senior management to believe in the company and its products/services, employees can utilize their network of friends and colleagues to grow the company’s circle of influence.”

Author Ronald J. Alsop tells a story in his book, “The 18 Immutable Laws of Corporate Reputation,” (Free Press, 2004) about Larry Fish, former Chairman and CEO of Citizens Financial Group.  Alsop says “Larry Fish is rare among CEOs in that he recognizes the value of employees to corporate reputation and makes them his goodwill ambassadors.  It’s the employees who are on the front lines working with customers, suppliers, shareholders, government officials, and other audiences.  They must be your loyal allies because their effect on your reputation is immense.  They can be your biggest fans or your worst enemies.”

While the characteristics (excited, loyal, and knowledgeable) of the brand ambassadors noted in Alsop’s 2004 book are the very same characteristics that embody today’s brand ambassadors, the manner in which they influence has evolved.  Historically, brand ambassadors conducted their influencing activities primarily through face-to-face interactions.  These interactions took place at their offices, civic meetings, places of worship, and anywhere else someone was willing to listen to them.  Brand ambassadors are successful influencers not because they are great salespeople but because they love what they do and who they do it for.  Their ability to influence is the result of their passion – as well as the positive reputation of the organization, product, or service.

While today’s brand ambassadors still possess excitement, loyalty, and knowledge, they are no longer confined to face-to-face activities.  Through social media tools such as Facebook, Twitter, and LinkedIn, today’s brand ambassadors can influence a much broader audience.  Social media enables brand ambassadors to influence not only their neighbors across the street but also those living across the country and across the world.

Facebook, the 800-pound social media gorilla, boasts over 800 million active users.  Active users maintain an average of 130 “friends” on their Facebook social network.  Twitter, another dominant social network, maintains over 100 million active users.  LinkedIn, the social network of choice for business professionals, maintains over 135 million active users.  And these numbers do not reflect the millions of users that belong to other social networks such as YouTube, Google+, Foursquare, MySpace, and hundreds of others.  A cadre of social media-enabled brand ambassadors can produce results significantly better than was possible just a few years ago.

According Inc. Magazine blogger Eric Markowitz  (“How To Find The Right Employees To Be Your Brand Ambassadors”), “In order to fully realize – and leverage – an employee’s full value, a successful company needs to find creative ways to tap into its employees’ networks (both online and offline).  Brand ambassadors, or employee evangelists, are becoming an increasingly common way for brands to leverage their biggest asset – their workforce, of course – to reach new markets, generate buzz, and put a real face on the company.”  Schwartz Communications blogger Allison VanNest states on the Schwartz Crossroads blog (“Must Love Snacking: Empowering BrandAmbassadors Through Social Media”) that “Employees are becoming more engaged as company influencers.”

Regardless of the demonstrated value that comes from an excited, loyal, and knowledgeable cadre of employees, there is often a discrepancy between the message delivered by the organization through its marketing efforts and the message delivered by its employees.  This discrepancy is the result of the organization’s failure to formally train and deploy its employees as part of the organization’s overall branding strategy.  This failure on the part of the organization denies the customer, employee, and organization an opportunity to maximize the benefit received.  The customer misses an opportunity to receive the best possible attention.  The employee misses the opportunity to play a larger role in the success of the organization.  And the organization misses an opportunity to develop a deeper and more valuable relationship with the customer.  The organization’s failure also ensures that employees lack the excitement, loyalty, and knowledge necessary to become effective influencers.  The negative impact of this failure is compounded when the organization does not make use of the leverage provided by social media platforms.

Logical String blogger Mayank Krishna concludes (“Employees As Brand Ambassadors”) that this failure causes customers and potential customers to question whether “The brand is true to what it is projecting or are there things deeper than what meets the eye?”  Krishna attributes the lack of employee influence-ability to the fact that “In a majority of organizations, brand and branding is a domain that is considered the exclusivity of brand managers and marketing managers.  For an average employee, brand management doesn’t seem relevant and he/she is hardly aware of the nitty-gritty of the brands and brand management philosophies of his/her organization.”

As such, unless organizations create a formal Social Media-Based Employee Brand Ambassador Program to ensure that employees are well-trained brand evangelists, organizations will lose out on the potential benefit that comes from employees that decide to make it their mission to act as influencers for the organization.  A further risk is the competition.  To the extent that competitors develop their employees first, the organization puts its business at risk.

Sunday, December 18, 2011

Managing Multiple Social Network Accounts

Banks that are new to social media or are determining how best to jump into social media eventually ask the following question: “Should we start with one social network or several?”  The answer?  It depends.

All things being equal, being active on multiple social networks is better than one.  Unfortunately, all things are not equal and resources, both human and financial, play a role in the ultimate look and feel of any social media strategy – including the number of social networks on which a bank participates.

According to the ReadyBuzz blog, “the biggest mistake most businesses make is to only use one social media platform.  In most cases, they either choose Twitter or Facebook. The truth is, one just isn’t enough.”  Many social media users maintain two or more social media accounts.  In many cases these accounts are established when the user first visits the social network as part of a curiosity or through the referral by an acquaintance.  However, regardless of many users’ maintenance of multiple social media accounts, users are not equally active on each social network.  As such, users may only access one account on a regular basis and largely ignore the others.  This means that a bank that focuses its social media efforts on a single social network risks missing out on a large portion of social media users that use other platforms.

Zmags blogger Christina Pappas recommends how to best utilize multiple social networks.  According to Pappas, “there are many social media channels and most of us use each channel with a slightly different spin.  The type of content we would Tweet is different than the content we may post to a Facebook Business Page.  Both of those formats may require a different twist than we’d offer on LinkedIn.”  Pappas makes the case for a strategy that differentiates the manner in which information is shared on each social network.

However, Inc. blogger J.J. McCorvey warns against biting off more than can be chewed.  According to McCorvey, “If you have enough staffing power to handle multiple social networking sites, that’s great.  If not, it’s important to focus on one or two, or you could spread yourself too thin and fall victim to the ‘gaping void’ perception, where you end up going days without activity.  Your followers will notice.”

Social Media Today blogger Mark Evans echoes McCorvey’s advice.  In one of his posts Evans recounts his advice to a small business.  According to Evans, “my reluctance to suggest a multi-pronged approach was mostly due to the lack of available resources.  The last thing I wanted to see was the company blast out with several Twitter accounts, only to see its efforts fail due to poor content or a lack of activity and engagement.

An example of the success that can be achieved through the use of multiple social networks is Starbucks.  Blonde 2.0 blogger Ayelet Noff credits Starbucks’ multipronged social media strategy as one of the reasons why Starbucks has been successful at creating millions of fans for the brand and keep them involved in the brand’s doings.  According to Noff, “The brand has created a digital dialogue with its customers, enabling people to give their feedback and receive a response back from Starbucks addressing their concerns/comments.  Starbucks is showing its customers and potential customers – ‘hey, we care about what YOU have to say.’  I am certain that if each one of these elements was done alone then the strategy would not have been as successful and complete as it is when done like this in integration with the rest of the elements on board.”

Amanda Brooke, Drop Ship News blogger, speaks to the advantages of multiple social networks by stating that “by working on your brand on the most popular social media sites such as Twitter, MySpace, Facebook and YouTube, you can reach a much, much broader audience than traditional marketing methods.”  Social Media Today blogger Daulton West, Jr. goes on to say that “’listening’ to their customers, and creating conversations that span several social media sites, allows for communication that strengthens relationships for existing and potential customers.”

In the final analysis, while it appears desirable to maintain several social network accounts simultaneously, it is critical that the bank maintain a budget that provides for adequate staffing to ensure that the bank’s social media efforts add value.

Friday, December 9, 2011

Look Who's Talking: Facebook Engagement

Facebook recently began disclosing several key metrics on Facebook Pages to assist Page owners at-a-glance in assessing the success of their Facebook efforts and to assist visitors to the Page in determining how useful others have found the site in the past week.  These metrics are disclosed along the left side of the Page (they, along with other metrics, are also found on the Insights page).

The first metric indicates how many users Like the page.  Traditional Facebook marketing theory states that the bigger this number, the better.  That is why so many social media consultants go on about tactics to increase "Likes" as if he with the most Likes wins.  While I agree that all things being equal, more Likes is better than less Likes, I also believe that it's not the quantity of the Likes but rather the quality of the likes that will make a Facebook effort successful.

Social media is about social engagement.  Social engagement does not occur unless the Facebook effort provides value.  As such, it does not matter how many Likes a page has if the content is not engaging.  Without valuable content the community will ignore the page resulting in a wasted effort to attract the community.  In other words, a Page with 100,000 Likes that was created through some effective marketing effort will not help the bank if none of the 100,000 users visit the Page on a regular basis.

In order to evaluate the effectiveness of a Page's community, Facebook provides the number of users that have "talked about" the Page in the past seven days.  This "talking about" statistic is fairly meaningful as it states the number of users that have engaged with the Page (e.g., brand) in some form.  Activity that is included in the Talking About statistic includes users that:

  • "Liked" the page
  • "Liked," commented on, or shared a Page post
  • Answered a Question on the Page
  • Responded to an Event 
  • Mentioned the Page
  • Tagged the Page in a photo
  • Checked in or recommended the Page location
In the examples below you see two sets of data taken from two banks - one small bank and one mid-size bank.

The bank on the left has only 409 Likes and the bank on the right has over 2,500% more at 10,850 Likes.  A natural conclusion based on the Like data may be that the mid-size bank has created a more valuable Facebook asset.  However, a review of the "talking about this" number suggests that while the mid-size bank has more likes, the absolute number of users that have engaged with the bank is identical.  As such, either the mid-size bank has a bunch of uninterested followers or the small bank has an active bunch of followers.

So why is having as many users talking about the bank so critical? Well, it is the active and engaged users that are most likely to support and evangelize for the bank.  These active users will tap into their social networks and inform their friends and acquaintances of the reasons why they should support the bank.  In addition,  new visitors to a Facebook page can look at these two metrics to understand how popular, active and engaging the Page is and as a result, whether it is one that they wish to follow.  Losing out on an opportunity to engage new users results in a loss of not only that user but of that user's social network.

While banks should seek as many Likes as possible, they should also examine the number and percentage of followers that are engaging with the bank.  If too few are engaging then the bank is not providing adequate content.  This may result from too infrequent posts, too many "salesy" posts, too frequent posts, uninteresting posts, etc.  It should be the job of the Facebook admin(s) to analyze the data to figure out how to best convert the nonengaged users into engaged users.  Once users become engaged then their networks may also become engaged, and at that point the Facebook page may provide significant value.  However, until engagement occurs, the Facebook page becomes that question about whether a tree falling in the woods makes any noise:  if a Facebook page with tons of users creates no engagement does it provide value?  Very little.

Thursday, December 1, 2011

What To Do With Those Repos? Facebook Them!

During these tough economic times it is not uncommon for consumer banks that originate auto loans - particularly used auto loans - to have to pick up a repossession or two. In many cases banks will dispose of the autos through wholesale auctions or wholesale transactions with used auto dealers. Depending on the car and the outstanding balance, sales through auctions or directly to dealers will result in marginal to significant write offs, as the banks are forced to accept deep discounts.

Fortunately, with the purchase of a fairly low cost video camera and video editing software, banks can now create and distribute videos through social networks in an effort to connect directly with consumers and obtain retail sales prices on their repossessed autos - and possibly provide the financing to qualified borrowers.

After exploring its options, Pan American Bank (my employer) in Los Angeles initiated a social media-based program that distributes videos on YouTube, Facebook and other platforms to publicize its repossessed used autos.  Through the use of in-house videos, Pan American Bank is able to achieve several goals:

  1. Publicize the sale of its repossessed autos directly to retail buyers, reducing/eliminating the losses  experienced from wholesale transactions.
  2. Create a following among consumers seeking quality used autos.
  3. Increase the Bank's visibility. 

As the cost of  video equipment and video editing software has fallen sharply (most cell phones provide video capability), many individuals have become pro-am videographers.  If your organization has little to no budget, a great place to begin a search for a video expert is within your organization.  A simple e-mail blast to employees asking for experienced videographers may result in one or more in-house resources.  This will reduce costs and increase flexibility.  If an in-house resource is not available, inquire with students at local high schools and colleges. Finally, call on video services.  If budget is not a problem you may want to seek a professional right away.  However, you may be pleasantly surprised at the quality of employees.

Sunday, November 13, 2011

Social Media's Tortoise and the Hare

We've all heard the Aesop fable of the Tortoise and the Hare.  In the story, the hare, speedy and full of bravado, fails to win the race against the slower tortoise.

The financial services industry is undergoing its own version of the fable with respect to social media.  On the one hand you have firms such as Chase, giving away $1 million dollars through Facebook.  On the other hand you have firms such as Morgan Stanley, reluctantly entering the world of social media by getting every tweet, LinkedIn post and other social media comments pre-approved by "corporate" before making the messages public.

While it is important for every firm to understand the influence of social media, it is just as important for every firm to do it in a manner that is consistent with the culture and governance style of the firm.  Some firms, such as Chase, are very comfortable jumping into social media with both feet.  We'll call them the hare.   This is a function of the culture at Chase.  Some firms, such as Morgan Stanley, are more comfortable taking calculated steps.  This too is a result of the corporate culture.  We'll call them the tortoise.

Unlike the fable, this is a race where there is likely no loser.  What is important here is that organizations move into social media at a pace at which they are comfortable.  As stated on this blog many times; most important is for firms to actively "listen" to social media to determine what is being said so that appropriate responses can be provided.  Beyond listening (which IS mandatory for all), every firm should move at a speed at which they are comfortable.

Some firms will train and trust their employees as brand ambassadors and unleash them to do their thing on social media.  These firms will have no problem sleeping at night.  Other firms will limit employee access to social media and will screen and pre-approve all messaging.  For these firms, this is the only way they can sleep at night.  While social media proponents will push for the former, the reality is that either approach will work.  What is important is that the firms implement something in order to remain visible and competitive.

The Age of the Thick Skinned Banker

Amplicate, a social media analytics company, released a report that suggests that banks need to develop thick skin, really thick skin, in the new world dominated by social media.

The Amplicate study revealed that 83% of opinions about major banks in the US and Europe were negative over the past 12 months.  The study focused on large money center banks and not on the smaller community banks.  While community banks would have likely performed better due to their reputation as being more consumer-friendly, the lesson is the same: bankers need to learn to deal with and manage criticism like never before.

Social media makes it easier than ever for consumers to make their complaints public.  Look at Bank of America's recent social media troubles related to its $5 debit card fee.  The public outcry resulted in a complete about face by Bank of America and created significant damage to the Bank of America brand that will take some time to repair.

Banks' knee jerk reaction may be to avoid social media altogether in an effort to avoid the criticism.  However, as has been repeated many times on this blog, the criticism will occur regardless of a bank's stance on social media.  A better approach is to play offense and implement a social media monitoring system that tracks what is being said about the bank and responds in a transparent and honest manner in a effort to prevent the criticism from snowballing in a manner similar to that experienced by Bank of America.

Saturday, November 12, 2011

Bottle Service with that Social Media

One of my favorite social media videos remains this one by Socialnomics.  I must admit that I get quite pumped up after watching and listening to this video by Erik Qualman.  Erik put together one of the best business-related videos ever!  This explains why this video has gone viral and has provided such a tremendous boost to Erik's company.

I've attended and participated in more social media events than I can recall.  In so many of these I hear talk about going "viral."  For social media marketers, including those that represent banks, this represents the holy grail.  The reality is that very (very) few initiatives will ever reach "viral" status.

I like to use this video as example of what it takes to get an initiative to go viral.  The visuals of this video along with the beats made for an emotionally-charged video that encouraged not only sharing, but repeated viewing.  The combination of music and visuals created an emotional charge among viewers, almost turning viewers into Viral Zombies.  Viewers have no choice but to share this video (I'm sharing, aren't I!).

I don't mean to discourage organizations from seeking the holy grail of social media sharing.  I just want to make sure that it is understood that social media is about being "social."  And before anything is shared - especially at the "viral" level - it must appeal to the social side of our existence.  In this case, viewers of the video get their blood pumping, head moving, feet tapping.  Watching people watching this video is almost like watching Will Ferrell and Chris Kattan in A Night at the Roxbury.

So before launching the next "big" social media initiative ask yourself how it will make people feel.  If it makes them feel significantly happy, sad, proud, etc., then it has a chance at spreading.  If it doesn't then don't expect much from it because no one will care.

Hello, Mr. Watson, Can You Hear Me?

On November 12, 2011, the Customer Contact Association released an advisory (Social Media Revolution Rewrites Customer Service Rules) that made the following observations:

  • Companies must review which channels they use to monitor customer feedback as there is a mismatch between customers’ preferred channels and the ones companies monitor most frequently.More than 70% of the online population now regularly uses Facebook and Twitter.
  • Forty-six percent of consumers believe that social media can hold brands and companies accountable.
  • Businesses must reinvent their customer service models to respond to a growing breed of ‘connected customers’ who use social media to comment on service.
  • Businesses need new multi-channel strategies to tackle ‘disconnect’ with customers.
  • Forty-four percent of consumers believe companies do not care what they think.

While the data is helpful, I don't think anyone is surprised by the outcome - especially in the post-Occupy Wall Street world.  What is most useful is the conclusion that companies (banks included) are not listening in the right places.  Traditionally banks have used paper surveys, face-to-face interaction and other old school methods to obtain customer feedback.  Today, while these methods still apply, there is more and more feedback being provided through social media channels (Facebook, Twitter, blogs, etc.).  As such, it is important that banks "listen" to all applicable channels - not just those they are traditionally programmed to monitor.  At a minimum, banks should make use of Google Alerts and to listen to the feedback/comments being placed out on the Internet.  Of course, larger organizations may opt for more robust (and expensive) solutions such as Radian6 and others.

Monday, October 31, 2011

Social Media Crisis Training - Mandatory For All Bank Employees?

On October 7, 2011, the Occupy Santa Cruz movement made life much more difficult for banks - large and small.  On the third day of an Occupy event in the small coastal town, an event took place that has likely turned upside down the life of a Bank of America branch manager.  This same event should have the Bank of America training department scrambling to address an important issue: how to handle confrontations with customers and protesters to avoid public relations disasters.

The October 7th incident involved several woman seeking to close a Bank of America account.  The women entered the branch with protest signs and a video camera.  The branch manager upon noticing the women immediately acted by politely asking the women to leave the branch.  The entire exchange was captured on camera and subsequently released on YouTube.  The video has been broadly distributed, resulting in hundreds of thousands of views, causing continued damage to the Bank of America brand as well as likely affected the branch manager.

A few thoughts came to mind as I watched the video.  First was whether Bank of America senior management had provided its branches with guidance regarding how to handle protesters.  In this case, while the protesters were carrying signs and a camera, they appeared quite passive.  This was clearly a set up and the branch manager played directly into their hands when she indicated that they could not be both a customer and a protester and kicked them out.  As a former branch employee, I appreciate the feelings that overcome someone when things go sideways in the branch.  And as such, it is hard for me to be too critical of the employee for reacting as she did.  However, perhaps banks should roll out training that requires employees to first evaluate the scene - especially if cameras have been used.  And while hindsight is 20/20, in this case, having an employee calmly close the account would have been the best option for diffusing the incident.  Perhaps some vignettes would help get the point across.  Because, while the Occupy movement may or may not die out soon, similar approaches are likely to continue in the age of YouTube.

Another thought is having banks establish a clear policy regarding the use of video cameras within the branches.  Many gyms post policies regarding the use of cameras in their facilities.  Banks should determine their own.  And while they need not post the policies, managers should know the policy and be able to calmly describe and provide a copy of the policy to individuals in a manner that will not make for a good smear video.

Times have changed.  Bankers hope only temporarily.  But they have changed.  Every bank employee must recognize that he/she is an ambassador of the organization.  Everything they do may be used positively or negatively in social media.  The more aware employees are of their role as brand ambassadors the better off everyone will be.

Sunday, October 30, 2011

Social Media and the American Autumn: The Social Media Effect

On Friday, October 28, 2011, Bank of America officially raised the white flag when it announced that it would exempt certain customers from its previously announced five dollar debit card fee. After severe criticism in the traditional media and especially social media, Bank of America announced that customers with direct deposit or Bank of America credit cards would not be assessed the five dollar fee. It is quite a win for consumers and a major setback for Bank of America's retail strategy team.

Just a month ago all the major banks were talking about recouping revenue through some form of fee on rank-and-file customers. However, in the wake of the severe backlash not only has Bank of America changed its tune but so have Wells Fargo Bank and JP Morgan Chase.

This American Autumn that was initially sparked with the birth of Occupy Wall Street, has taken to social media and has broadened its breadth and scope, resulting in an initial win with the withdrawal of Bank of America's debit card fee strategy.

Such an attempt 10 years ago would not have resulted in such an outcome. However, with social media's immediate and widespread impact, banks must now consider The Social Media Effect when devising corporate strategies. This is something that Bank of America failed to do. And it was evident on their own Facebook page, where complaints went unanswered by Bank of America.

As a long time banker I have always included "reputation risk" as one of the risks evaluated from time-to-time. However, as most bankers will tell you, this was always one of the lesser risks. As bankers we focused most of our energies on credit risk, interest rate risk, market risk and compliance risk. Now we must elevate reputation risk to the top tier thanks to social media.

The smaller the bank the less likely the bank is to register on the radar. Regardless, a community bank's reputation can be easily and quickly tarnished if "conversations" are not monitored and if banks fail to consider the Social Media Effect within the context of reputation risk.

So my advice to bankers in light of Bank of America's recent debacle is:

1) Utilize a form of social media monitoring. Whether it is something as simple as Google Alerts or SocialMention. And ensure that individuals within the organization are tasked with responding to comments in order to attempt to prevent a snowball effect that may create significant harm.

2) When developing strategies, do not fail to consider The Social Media Effect. A poorly thought out strategy can lead to severely adverse outcomes resulting in a loss of reputation and customers.

3) Include The Social Media Effect within the organizations crisis response plan.

While I do not believe that the "mob effect" will dominate all of the conversations within the banking industry, or any industry, for that matter.  I do believe that we have reached the point where The Social Media Effect must be taken seriously.

Saturday, October 29, 2011

Regulatory Concerns and Loss of Control Slow Banks' Adoption Of Social Media

An October 23, 2011 Holmes Report blog posting identified the two major fears that banks have relative to social media implementation: regulatory implications and loss of control.

According to The Holmes Report, 73 percent of banks believe that they are behind but catching up in their social media activity. But the sector realizes that social media will not disappear: 16 percent have a social media strategy in place, 28 percent are in the early stages of implementation, and 41 percent are in the process of creating a social media strategy. This compares with 3 percent who have decided against a social media strategy and 13 percent who haven’t started thinking about it.

The Holmes Report cites brand awareness as the most popular reason for social media usage. According tot the report, banks find Twitter as the most useful social media platform followed by LinkedIn.

Addressing the regulatory implications is simple (easy for me to say).  Any social media implementation should be preceded by a careful analysis.  I recommend David Kreiman's recent presentation (Social Media at Community Banks) at the ABA National Convention as a starting point.

Next, I would recommend a review of Creating an Ironclad Social Media Policy.  This document provides the policy guidance necessary to satisfy examiners, auditors and executive management.

Finally, I would highly recommend that a copy of the Human Resources Guide to Social Media Risks be given to each member of senior and executive management.  This book will provide a very good assessment of the risks that exist as a result of social media use.

These three guides should provide the tools necessary to put any organization's fears into perspective.  At the end of the process the conclusion should be, whether or not social media is for our organization, it is not going anywhere anytime soon and at a minimum, the organization better be listening to what other are saying in order to adequately manage reputation risk.

Thursday, October 27, 2011

Social Media at ABA 2011

I got back from the 2011 American Bankers Association National Convention about 10 hours ago and I'm now starting to begin the process of digesting the many messages knocking around in my head.  Before I go into the social media messages I'm currently digesting, let me say this - the ABA scored a perfect 10 on locale for this year's event.  The weather along the San Antonio River Walk could not have been better.  It was tragic to have to be indoors during the event.

So, this year's annual convention would not be complete without at least one segment on social media use.  In fact, we had two.  One segment was a vendor-produced breakfast presentation and the second was one that featured the ABA's Denyette DePierro, Glenview State Bank's David M. Kreiman and yours truly.  In addition, at least one other presentation brought up the issue of social and its importance to the banking industry - particularly the community bank segment.

The slide below, from Cornerstone Advisors, pretty much tells gives the gist of the messages: it's the number of users, stupid!

The message being delivered across the board was that social media is too popular among all demographic groups to be ignored.  Banks, at a minimum, should attempt a low-risk approach to social media.  Banks were advised to wet their toes by launching a simple yet well thought out campaign to live the social media experience and make an educated assessment.

While disagreement may result regarding the appropriate uses of social media (e.g., sales tool? marketing tool?  community outreach tool?), everyone agreed on its usefulness.

Perhaps the most useful bit of advice was provided at a presentation by Beyond the Arc.  According to Beyond the Arc's Steve Ramirez, a bank should have some idea what it wants to accomplish with social media before embarking on the task.  Is it increased deposits, increased brand awareness/goodwill, increased loan production, etc.  Without an end in mind it will be impossible to determine the utility of social media.

Regardless of the exact expectation, banks should consider utilizing social media since social media use among consumers has become ubiquitous as has consumers' expectation that banks and other businesses also utilize social media.

Tell you what I would like to see next year from the studies on social media usage and ROI for small community banks under $500MM.  We get lots of stats on the big guys.  BofA, Chase, American Express, etc.  They have budgets to implement the cool (and pricey) campaigns and measurement systems.  But I'm more interested in First Bank of Main Street, One Percent Bank and their peers.

All in, the message at ABA 2011 was what I expected.  "If you're not on social media, get it on it!"  And I believe that's the right message.

Thursday, October 13, 2011

SAP Has Something to Say About Banking and Social

According to SAP blogger Michael Mischker, "strengthening customer loyalty and overall customer experience has become increasingly critical for banks because of the problems they’ve faced in recent years. A positive experience with branch offices and call centers is still essential. But social media gives banks and other financial service firms another arrow in their marketing quivers. Used strategically, it provides a powerful two-way dialogue with customers that can significantly enhance brand and revenue."

Here are some of Michael's tips:

1) Start a Dialogue:  There are many obstacles to integrating social media into a bank’s distribution channels — not the least of which is a change in financial institutions’ corporate culture which has historically emphasized monologue over dialogue. Many banks are also concerned about opening the door to negative commentary.  Standard marketing strategies will no longer win customer interest and trust. Increasingly, consumers will look to their social groups for banking recommendations and use social media to share their thoughts on particular institutions.

2) Competitive Advantage: An active social media presence can create a “sticky,” real-time relationship with potential and existing customers. Using today’s technology, the best-run banks can monitor the sentiment of and actively engage with customers, prospects, and key opinion leaders. At a time when the amount of data and information created by social networks is expanding exponentially, it’s more important than ever for banks to have robust support for listening and responding to social network commentary.

3) The Right Tools for the Job: Banks can easily leverage current technology to imbue the customer experience with a social touch. Banks can create the consistent experience across traditional and social media channels needed to strengthen their customer relationships.

Successful customer relationship strategies driven by social media rely on:

1) Responsiveness (listening carefully and replying quickly)
2) Relevance (keeping responses personal and meaningful)
3) Convenience (interacting with customers at their preferred time and channel)

Technology can put this all in place. But banks must, first, be willing to embrace the new opportunities for collaborative, two-way interactions with customers that social media outlets provide.

Core Processor Gets Into Social - Five Tips to Banks

Fiserv, Inc., one of the major core processors in the banking industry, shared Five Steps to Social Media Marketing at the 2011 BAI Retail Delivery Conference on how financial institutions can add social media to their marketing mix.

Five Steps to Social Media Marketing

1) Strategy Development: Developing a social media marketing strategy includes assessing customers' current social activities, determining goals and objectives, planning for how relationships with customers will change and deciding which social technologies to use.

2) Listening and Monitoring the Conversation: To get started, financial institutions should simply listen to what consumers are saying about their brand, their competitors and the industry. This can be done by using a listening tool, such as or Google alerts. Listening will reveal where customers and prospects are participating online, which may guide the decision on what sites to start with and where to focus initial efforts.

3) Laying the Internal Groundwork: Be sure to establish and share social media guidelines, which can be done in the form of a policy book, education video, fact sheet or other form of internal communication. Also be sure to establish a brand voice, whether it is professional, casual, upbeat or reserved, and create a response matrix outlining how to respond in a variety of situations. Develop a content calendar outlining future content.

4) Integrating Marketing: Promote the financial institution's social presence in other marketing materials. Adding social icons and links to websites, emails, brochures and other materials lets consumers know the bank or credit union is active in social media and makes it easy for them to connect.

5) Metrics and Reporting: The metrics measured will depend on the goals and objectives initially identified. However, when starting out, financial institutions can measure social media impact by looking at how far messages are traveling, the gain in visitors to their website, the number of engaged discussions and the number of users who return to financial institution social media sites.

Friday, October 7, 2011

Social Media Password Policies - More Than An Ounce Of Prevention

In early September, the Bank of Melbourne had its Twitter account hijacked by someone that used it to send phishing messages to its followers, many of whom were customers. The tweets sent from the Bank of Melbourne Twitter account contained malicious links.

The likely cause for the account compromise was a weak password used by a staffer with access to Twitter.

This event should serve as a lesson to banks with a social media presence. Just as banks maintain effective password policies to access internal systems, similar policies should be required for external systems.  Employees should be made aware of the damage that can result from lax/poor controls over passwords.  The lack of effective controls can result in reputational harm, regulatory criticism and legal action.

Thursday, October 6, 2011

Social Media is Social Business

Boxley Llewellyn and Chitra Dorai from IBM came up with these four ways that social media is transforming the banking industry.  They provided their analysis in a

1) Social business is critical for forging new connections, as well as elevating the brand.
Banks that can use it wisely can generate immediate, impactful results on increasingly social customers, many of whom use social media as an underlying "operating system" for their work and social lives.

2) Social business is a pivotal outlet for building communities.
Selling banking products and services can be understandably complex. However, building communities around products and services opens up a new way for consumers to inquire, engage and share material. Focusing on customer service and adopting the personalities of the people they serve, banks can bring new meaning to customer centricity.

3) Social business can be an invaluable tool for product research and education.
Whether you're crowd-sourcing to find out what customers think of your services, or using social media to encourage customers to develop new products, the social network provides a channel to solicit ideas and input. In fact, social customers expect to be able to input ideas, rate experiences and debate ideas. Banks are redesigning their websites to include new features to gather ideas and feedback. They deliver videos on product information via YouTube and ask customers to rate the site and suggest new products.

4) Social business can provide deeper insights into bank customers.
All of the information that is generated on social media sites is valuable data that can be analyzed and mined. New patterns can be uncovered and valuable insight gleaned -- from gauging what customers like and dislike, to understanding what products they respond to and assessing areas of improvement for customer service. Banks are just starting to use more advanced analytics to tap into this data and develop more customized services and offerings for customers to ultimately drive more business. They can deliver more tailored marketing and sales campaigns to generate more targeted results.

Wednesday, October 5, 2011

Rodney Dangerfield - The Father of Social Media Sentiment Analysis

When I was an undergrad at UCLA I had a horrible habit of staying up all night with friends, drinking Schaefer beer and eating Domino's while watching movies such as Caddyshack.  I gotta admit those were some of the best times. Cheap beer, good food and great friends. Of course, never did I think that anything other than bad hangovers would result from the experience.

I guess that's why I'm just a blogger and not a multi-gazillionaire.  You see, if I were paying better attention I would have noticed the wisdom in the words of the late Rodney Dangerfield.

That clip above wasn't the wisdom I was talking about. That was just funny.

Somewhere in the movie Rodney says "they're all buying, then sell, sell, sell!" It seems that the folks at, Inc. were also avid fans of Caddyshack. How else would they have come up with the idea of tracking company sentiment on social media as a means of determining which stock to buy and which to sell.

According to a Barchart press release, "researchers from Indiana University and the University of Manchester recently published findings that social media can have up to an 86.7% accuracy rate at predicting the market."  The Barchart product analyzes thousands of social media messages every second, compiling data that can be used for research, system development and real-time stock, futures and forex signal creation. The software instantly evaluates and generates trading signals based on the sentiment of investors using social media tools.

This product and the research behind it may be useful to banks relative to decisions and transaction that involve stock price such as merger and acquisition transactions.

Another example of the usefulness of social media.  But does it look good on you?

California Bankers Association Goes Hands On

NOTICE:  This post is a little off-track as it does not relate entirely to social media but relates generally to technology.  The next post will return us to our regularly scheduled programming.

If you're a banker chances are you've attended a conference or seminar hosted by a state banking association. As a long-time banker I've been to so many of these events that they have all started to look and sound the same. So when I received an email for the California Bankers Association Technology and Community Banking Conference I was pleasantly surprised.

According to the marketing materials, "this session will be unlike our prior seminars, in that to help get you more comfortable with these new technologies you will have a chance to try all of them out! Our goal is to allow you at least as much 'hands on' time to use the products as to just hear about them."

What a great idea!

As new technologies evolve and as more and more options fill the technology landscape, having these types of hands-on opportunities provides real value to conference goers.  One job of staff attending conferences is to report back to executive management about trends in the industry and the tools that benefit the organization.  Too many times all we have are Powerpoint presentations containing screen shots.

As an experienced conference speaker I understand the risks of letting the technology loose on the conference room floor.  If there was ever a call for gremlins, this is it.  But that is exactly why I commend the California Bankers Association for taking a risk and requiring their presenters and vendors to let the attendees "test drive" their wares.  At the end of the day, the money and time will be much better spent if  bankers get a chance to play around with the technology and decide for themselves whether the product is the real deal or just good marketing.

Kudos to the California Bankers Association for taking the risk and providing a meaningful experience to the attendees.  This should go a long way in engaging attendees and should earn the California Bankers Association some positive buzz.

Monday, September 26, 2011

"Like" the Fed

According to a Sentiment Analysis And Social Media MonitoringSolution RFP, the Federal Reserve Bank of New York has decided that it is time for the Fed to "join the conversation" and begin monitoring what is being said about it on social media platforms such as Facebook, Twitter, etc.  As traditional media has increasingly lost significant influence over the masses - particularly the younger masses, the Fed appears to be interested in what is happening among the "mass of niches," a term used by Chris Anderson in his book The Long Tail.

According to the Request for Proposal ("RFP"), the Fed is looking for social media vendors that can assist the Fed in achieving the following:

A. Geographic Scope of Social Media Sites:  support content coming from different countries and geographical regions.

B. Content and Data Types:  the solution must be able to gather data from the primary social media platforms such as Facebook, Twitter, Blogs, Forums and YouTube. It must also be able to aggregate data from various media outlets such as: CNN, WSJ, Factiva, etc.

C. Reports and Metrics:  the solution must provide real-time monitoring of relevant conversations. It should provide sentiment analysis (positive, negative or neutral) around key conversational topics. It must be able to provide summaries or high level overviews of a specific set of topics. It should have a configurable dashboard that can easily be accessed by internal analysts or management. The dashboard must support customization
by user or group access. The solution should provide an alerting mechanism that automatically sends out reports or notifications based a predefined trigger.

It looks like the Fed has been watching, listening and learning relative to the power of social media.  As things have gotten dicey for the Fed during this difficult economic period, it seems the Fed would like to play a larger role in understanding what is being said in order to develop an appropriate response.

Of course, anytime the Fed does anything out of the ordinary there will be conspiracy theorists jumping to action.  For example, why is the Fed seeking to monitor Fed-related conversations of bloggers and others?  Is it to quiet the dissent?!  Most likely it is for the same reasons Citibank, Bank of America, U.S. Bank and other large multinational financial organizations as well as much smaller banks are doing head off trouble through a social media-based early warning system and create brand value.  Social media is a powerful tool for any size organization.  If it's good for bankers why not central bankers.

It will be interesting to see how the Fed ultimately uses social media monitoring.  Will it take advantage of the lessons learned to-date by banks and other businesses or will it assume the rules do not apply to it and create a public disaster of this opportunity.  We'll see.

Sunday, September 25, 2011

Using Facebook to Direct Community Contributions

First State Bank in Texas launched a social media-based contest to benefit local PTA groups. Through the use of a voting competition on Facebook, First State Bank will determine how to donate $8,500 to PTA groups in communities it serves. Along the way it will significantly increase the number of consumers that will track First State Bank's activities on their Facebook stream.

The contest will run for approximately a month. At the end of the month, the top three PTA groups will receive a portion of the $8,500.

According to First State Bank's Chief Lending Officer, the Bank's goal "is to help raise some money for the schools and get some interest in the bank." In just over two weeks the Bank has gone from 800 "likes" to over 7,800, making this a successful campaign for attracting consumers to the Bank's Facebook page.

Along with the rules of the contest, First State Bank provides participating PTA groups with the following tips for earning "likes" in their favor:


  • Make posters to hang in your school or community.
  • Tell your friends, neighbors, and relatives about the contest.
  • Ask them to vote daily!


  • Vote for your favorite school PTA / PTO every day between 9/15 and 10/15.
  • Set a reminder on your phone or calendar so you don't miss a day!
  • Use your social networking tools to tell everyone you know.
  • Post it on your Facebook page!
  • Tweet it!
  • Text it!
  • Assist your child in sending out emails or making phone calls to long distance relatives to get their votes.

School Staff

  • Ask faculty members to share a link to the contest on their own Facebook page after they've voted.
  • Include contest information in your weekly school newsletter and on your website.
  • Tell students about the contest during morning announcements.
  • Make an announcement to parents at your next PTA meeting.
  • Challenge each student to ask at least five relatives or neighbors to vote for their school.
  • Enlist a group of students to hold up signs about the contest during morning drop-off.
  • Keep a computer in your school's front lobby to give staff and parents easy access to voting. Put a sign next to it, asking people to log on to Facebook and vote.
  • Get the students and staff excited by giving them daily updates on how many votes the school has.

While these types of contests can be very effective in earning "likes," the challenge for banks is what to do once the contest is over.  Without subsequently engaging these individuals in meaningful ways, the first thing that will happen is the un-liking of the bank.  As such, any such contest should contemplate how the contest fits into the bank's overall social media strategy to maximize the time, energy and money put into the contest.