Pam McBrideThe financial services industry has embraced social media, using it to connect with their customers and build their reputations. However, just a few short years ago, banks, credit card companies and investment firms were nervous about wading into the often-unpredictable waters of real-time communication with their customers.
As more financial brands begin to adopt digital and social media strategies, we’re seeing some interesting trends emerge. Here are four that we’ve identified:
Trend #1 – A slow start out of the gate, and a race to the finish line
Due, in part, to strict industry regulations, financial services have been slow to adopt social media. However, now that regulations have caught up, and financial services have seen that social media is here to stay, the industry is seeing 31% growth on social networks – far above average.
Financial services are quickly making their presence known on Twitter, Facebook and other social networks. They are live tweeting, sharing new products, and even making recommendations.
Part of the reason for the surge in social media adoption is due to the fact that consumers are turning to digital banking in a big way. A McKinsey report suggests that within the next five years, digital sales could account for more than 40 percent of new inflow revenue in certain areas and customer segments.
Trend #2 – A firm understanding of the regulations
Financial services are one of the most regulated industries in the world, and their activities on social media are no exception. Strict recordkeeping and supervision regulatory requirements pertaining to social media means that any financial service that wants to tweet, post updates or snap Instagram photos must stay on top of regulations.
The SEC, FINRA, IIROC and other organizations have created social media guidelines for financial institutions looking to leverage the power of real-time communication with their customers.
Some common regulations include retaining records of all communications on social channels, pre-approval of certain messages by brokers or partners, appropriate training for social media representatives and more.
Trend #3 – An emphasis on customer service
The human touch is what sets great financial institutions apart from the pack. Brands like TD Canada Trust, American Express and Chase understand this, and are using social media to personalize their messaging and tailor customer service to each individual customer.
Financial brands are staying away from the impersonal, big-box feel and instead use social media for a warmer connection to their customers. They are able to answer questions, help with problems, and offer advice in a much more personal way than simply saying “call our 1-800 number.”
Trend #4 – Mobile-friendly apps
According to a recent study by Adobe, financial service mobile apps are the number one most-opened type of app by consumers. In fact, consumers use these apps 30 percent more frequently than any other category of app.
Two major reasons why consumers are turning to mobile banking and investing is likely because of security, and how easy it is to log in compared to a website. These apps securely store their private data, and require just one click to access all of their banking or investment needs.
Whether using social media for customer service or focusing on building out exceptional mobile apps, the financial service industry is turning to digital and social media to remain competitive. A decades-old company, like Transamerica, is using social data to guide their marketing strategies today. And trends across the industry indicate that this emphasis on digital is only going to grow.
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