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Social media & the US banking industry

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UPO Students & Social Media

How many of you…

- Have a account ?

- Are fans of a brand on facebook ?

-Would prefer to connect through facebook or twitter to their bank instead of e mail, phone or branch ?

-Would like to learn more about customers’ needs, expectations and fears on social media ?

-Would like to learn more about how to design and implement a strategy on social media ?

-Would prefer to connect through facebook or twitter to their bank instead of e mail, phone or branch ?

How many of you…

- Have a account ?

-Are fans of a bank on facebook ?

-Would like to learn more about how to design and implement a strategy on social media ?

How many of you…

- Have a account ?

How many of you…

- Have a account ?

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If you have questions, we will have time to discuss further after the presentation….

But during the conference, you can connect to Twitter to @yvonmoysan and start to ask your

first questions !

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Social media & the US banking industry in 2011

Facebook

Twitter

Source : Social bakers, Juillet 2011 et Website-Monitoring, Avril 2010. Visible Banking Facebook & Twitter Watch, Août 2011. Twitaholic.

Focusing on commercial brands, Chase with 3 millions of fans is currently ranked at the 700th world position… far behind Coca Cola (14th position with 24 millions of fans).

Focusing on commercial brands, there are no financial institutions in the top 1 000 on Twitter.

…

Focusing on financial institutions, 9 US brands are in the top 10 in terms of fans on facebook !

Focusing on financial institutions, 3 US brands are in the top 10 in terms of followers on Twitter.

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… However, a couple of months ago, American banks were in a

completely different situation…

In the United States of America, in 2011 and after the financial crisis, banks regain customers’ trust. About 57 % of American bank customers trust their bank, compared to 47% of French bank customers…

Source : Etude Deloitte pour l’Institut Harris Interactive, 2011.

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After the financial crisis, trust in banks decreased in the US.

Social media as an opportunity to regain customers’ trust ?

Sources : Forrester Research. Citi Bank, Building the social bank, Social media strategies, Mai 2010.

Social media, a useful tool to regain customers’ trust ?

Primary objective : to rebuild customer’s trust

On facebook or Twitter, a lot of negative comments were posted by customers. But, these new communication channels allowed banks to answer and customers to notice, in return, their satisfaction.

Regional Bank58% Bank of America 31%

Ing Direct 46% Chase 31%

Wells Fargo 43% Capital One Bank 29%

US Bank 37% Citibank26%

Charles Schwab 34% HSBC 16%

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Social media & financial institutions, a real opportunity.

1 An opportunity84 % of Internet banking customers use social media, and among them, 11 % use social media to connect to their bank.

Source : Fiserv, Financial institutions and Social Media, Août 2010. Etude réalisée auprès de 3000 clients représentatifs de la population internautes américaine.

A new way to reinforce customer relationship For all generations, primary motivations to connect arerelational and not transactional.

2

A lack of awarenessAmong the customers who wanted to connect in the next future, 71 % declared that they did not know that this way of communication exists.

3

Online privacy and security: the fear factorsCustomers are uncomfortable with private life and personal finance mix.

4

The customer add value is not perceivedCustomers do not perceive the reason why they should connect to their bank through social media.

5

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Social media could be an opportunity for US financial institutions to reinforce customers

relationship…… but there are still some constraints and

challenges to manage.

Case study

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Problems / ComplaintsQuestionsRatings / Reviews / FeedbackCustomer-to-customer supportNegative commentsMisperceptionsKudos

Determine responseDevelop comms. approachApply policy / procedure

ServicingPublish contentEducateEnter dialogueTarget marketingEstablish communityEnhance Relationship

Page hitsCommentsActive users, Followers, InfluencersFavorites, Pass-alongsSentimentConversions

Fix systemic issuesReengineer processesImprove usabilityEnhance offerings

Listen

Adapt

Measure Engage

Analyze

Source : Citi Bank, Building the social bank, Social media strategies, Mai 2010.

By seizing the opportunity ! 1

Citibank social media strategy

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Citibank social media strategy

Source : Citi Bank, Building the social bank, Social media strategies, Mai 2010.

By designing a roadmap to reinforce customer relationship !

S1 2010Preparing

Competitive Challenger Industry parity Industry Leader Best practiceLeader

Organization Decentralized Centralized Centralized Distributed

Consumer Listening Dialog Engagement Advocacy

S2 2010Activating

S1 2011Scaling

S2 2011Winning

By engaging customers and employees.By integrating Facebook and Twitter icons in customers ads.By launching Citi 2.0, an internal social media website allowing to 50 000 employees all around the world to share information on projects and to work together

3

2

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30/09/12Source : Citi Bank, Building the social bank, Social media strategies, Mai 2010.

… and by personalizing the customer relationship (in progress)

By communicating on potential risks

To Reassure customers4

Citibank social media strategy

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A unique « bank » page

To deliver a clear add value to the customer5

Citibank social media strategy

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To deliver a clear add value to the customer5

Citibank social media strategy

To reach the customer service platform

through Twitter

To provide personalized offers

To interact with customers who have the same interests To support a cause To have fun

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« It takes time to develop a strategy on social media, because you have to convince people internally and it requires open-mindedness.

At Citi, it was a real cultural revolution,facilitated by our internal social media website Citi 2.0.

It requires also to adapt to the customers needs and expectations, as an example we are currently developing ‘‘click to chat” and “click to call’’

solutions to allow private communications.

In the near future, we imagine that our customers will use Twitter to communicate with their personal financial advisor

and to manage their bank account.» Senior VP Social Media

What about the other US financial institutions ?

Citibank conclusion

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What could be the future of social media in the US banking industry ?

« Our youngest customers do not reach their bank through physical channels like the branch, they also do not use so much phone or e mail compare to older customers. We think that social media will become a major communication channel for the millennium generation».

Senior VP Experiential Marketing

« Social media allow us to target a specific customer category like students or customers of a specific branch. We think that social media will allow us to develop a more targeted and more local communication».

Senior VP Retail Payment Solutions & Internet Strategy

Source : Interviews réalisées auprès des différents experts Média Sociaux, Août 2011.

« We consider American Express as a best practice. Their social media campaign had a direct impact in terms of purchases volume. We think that social media will become a tool to develop sales in the next future».

Senior VP Internet Managing Director

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Let’s connect ! Questions & Discussion welcome !

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