Saturday, July 20, 2013

Social Media in financial services industry

Retail industry has been taking advantage of social media from early days. However, in past few years, financial services industry including banks, online brokerage, and consumer credit card companies has started using social media for variety of purposes such as brand awareness, lead generation and connecting with customers. This trend has forced marketers in big financial firms to reconsider social interaction strategy that deals directly with customers. Companies now don't always need to use expensive TV and radio campaigns or direct mail for brand awareness but can also create dedicated page on social media platforms to directly interact with customers.


In general, there are few challenges faced by financial services companies that prevent using social media channels for products and services. After Global Financial Crisis, there are even tighter regulations, preventing wealth management companies to use social media to their advantage. Though companies generally sell more products and generate more brand awareness by word of mouth. However, social media poses another challenge i.e. a mistake can be really costly for attracting more customers due to social behaviors and endorsements in public. While mobile and social world continue to evolve, social media can still be used for increasing brand awareness, bringing traffic to the e-commerce portals and presenting value added services such as educational videos etc. 

A new social media platform, Finect, has been recently launched for financial advisors, asset managers and individuals seeking investment advice. Keeping fingers crossed for this new social media!!!.

1 comment:

NKW said...

As an extension to this, I have been thinking about the implications of digital marketing on B2B more broadly throughout this semester. My firm sells a relatively expensive subscription product that tends to have a sales cycle that lasts months. Obviously channels like paid search do not apply as obviously as they do in consumer firms, where ROI can be measured in a very straightforward way. SEO can be helpful for generating leads, but measuring the effectiveness and return can be a challenge given how long it takes to move down the funnel.

From a brand perspective, large B2B firms will need to continue moving significant dollars online as time is increasingly spent there. Is Facebook or Google advertising really accretive to major brands? Do tie-ins with LinkedIn make a company like IBM more present in our minds, or do they reduce the gravity with which individuals think of the firm?