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Social Media for Financial Services

The Use of Social Media for Financial Services Companies

We have all heard of the power of social media to transform internet start-ups into online juggernauts, and the far-reaching impact of a proper social media platform on a company’s brand cannot be denied.

Consumer brands have fully embraced the latest trends, but can the same be said for financial services companies?

Benefits are difficult to measure

As the benefits are much more difficult to measure for financial services companies, more and more companies are being asked to truly explain the effectiveness of social media.

The hesitation in adopting a more sustained social media strategy, in part due to the fact that tangible results are difficult to define, is widespread among many financial services companies. Companies that may have tried using Twitter or Facebook to build brand recognition are now abandoning those strategies and turning back to more traditional forms of communicating with the public.

There are countless stories of inappropriate pictures or tweets from companies that use social media, and these miscues can be crippling for a company looking to build a consistent image. The public will always remember the mistakes a company makes and rarely recognize the good messages that are communicated.

As a result, companies are more wary of minimizing their downside risk with any missteps and instead focused on communicating a single unified message.

One real benefit that social media gives a company is…

A wide range of statistics and information related to company reputation, brand image and performance measurement.

Many of these statistics are completely foreign to traditional competitive intelligence departments and a consistent data mining process is now needed to properly digest this plethora of information available.

The real challenge of financial services companies

Perhaps that is the real challenge of financial services companies – being able to develop a corporate strategy to consistently track and retrieve information gathered from benchmarking statistics related to social media.

A company deciding to implement a social media strategy must first ask itself what the benefits might look like. If they are not able to track and measure those benefits, it is ineffective to employ such a strategy. Not only will results be difficult to measure, even if a strategy is effective the company will have no way to understand and track what the benefits of such a strategy would look like.

With proper analysis more and more firms will be able to answer whether or not social media is a worthwhile tool or merely a passing fad.

15 years working in digital, an SEO & Social Media geek with an evident passion for the web, running my consultancy ThinkSearch, I'm loving life, technology, sharing, and particularly my 8 yr son old Archie and 2 year old daughter Lola. Living in Hove, UK.

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{ 5 comments… add one }

  • Sudipto September 1, 2014, 2:29 am

    Hey Tim,
    Nice post and Yes, Social media sites are really very helpful these days and many people are using it to make their business more effective. These tips really gonna help many newbies.
    Sudipto recently posted..Best Android Phone Under 12000My Profile

  • Ron March 20, 2013, 6:05 am

    I can tell you it’s one heck of a job to stand out among the many financial service providers out there. Social media definitely can help, but too much noise is what you have to be careful of.

  • Muhammad Reaz February 23, 2013, 11:57 pm

    Really appreciate with your article. valuable content share about social media. Thanks.

  • Sarah Park February 23, 2013, 6:27 am

    Social media is indeed playing a big role in every business nowadays. Enough knowledge and constant dedication are two great key to fully maximize its uses.
    Sarah Park recently posted..How to Become a ChefMy Profile

  • Randy Pickard February 22, 2013, 1:03 pm

    While you make a good case for why financial services companies should have a presence on social media and utilize it for data mining I remain a naysayer in regard to potential payback from major social media initiatives. Personally, I don’t really care about having an online relationship with my financial services providers. Heck, I work for a prom dress designer, and despite having a terrific target audience and product for social media, and an engaged base of fans on multiple social media platforms, we still can’t figure out how to engage followers via Google+. Just as our target audience is tough to connect with via Google+, I perceive that with the exception of blogging, financial services companies will find connecting with their audience via social media to be very challenging.

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