On August 30, 2011, The Financial Brand posted a great article on the use of location-based social media platforms such as Foursquare. According to the article, "most retail financial institutions have spent the better part of the last decade shooing people out of costly branch networks, choosing to push online, mobile and paperless solutions over one-to-one, personal interactions. Most banks and credit unions have done what they can to keep consumers out of branches and reduce transaction volumes."
It's true. Since online banking and ATM availability have become ubiquitous banks have looked to leverage these lower cost options in lieu of the higher costs associated with branch operations. So why are banks now trying to drive the traffic back into the branches through "check-in" campaigns associated with location-based social media platforms? Confusion.
In an attempt to make use of these very fun and interesting tools, marketers are unintentionally undermining years of effort in moving customers to lower cost distribution channels. While there is some advantage to drive traffic to branches - to open accounts. In most cases the transactions can be managed through online banking or automated phone banking.
If bank marketers insist on using location-based social media tools - and I believe they should, they need to get just a bit more creative. For example, banks can identify their best business customers and reward consumers for checking in at bank business customer locations. Or even better, how about struggling bank borrowers. Send business to them so they can make they loan payments this month!
Banks are extremely supportive of community-based events and sponsor many such events. How about rewarding customers for checking in at the local YMCA fundraiser or farmers market or similar community event.
Location-based social media platforms are great. But marketers need to think a little bit before unleashing their power. With a little thought banks can make use of a great tool while creating significant benefit for the bank and the community - without having to hire more tellers.