Financial Services Companies and Digital Marketing
Some industries are slower than others in adopting the use of new technologies. In the financial services sector, companies have been hindered by concerns over security and poor strategies on the use of technology and compliance hurdles.
That is starting to change as the acceptance of social media as a means for corporations to reach and develop relationships with potential clients is on the rise. A report from the McKinsey Global Institute called “The Social Economy: Unlocking Value and Productivity through Social Technologies”, found that social media boosts productivity and adds top-line revenues to those organizations who can best utilize it.
Three ways that social media is jump starting the marketing effort for financial services companies are
- Tapping into Customer Data – the use of social media generated data can move companies away from mass marketing techniques and into targeting consumers based on their needs. As consumers “broadcast” major life events on social sites, financial services companies can leverage this information into specific programs that will attract potential new clients.
- Increasing Customer Loyalty – consumer acceptance of connecting with companies over social media has increased over the years. As more consumers adopt on-line financial transactions, integrating social features with on-line services could increase customer loyalty over time and increase the amount of available on-line transactions as well.
- Lowering Customer Acquisition Costs – customer acquisition costs can be huge for financial services companies. One credit union in Canada acquired more than 2,000 new clients by launching a social media contest to find a new spokesperson for them. Leveraging social sites in new and innovative ways can reduce the costs of marketing campaigns significantly.
While tapping into social media is in itself critical, it must be done in concert with great marketing content. Since financial companies deal with significant regulations and compliance issues, it’s easier to get trapped into what you can’t say instead of focusing on what to say! Though there are challenges here, financial institutions also have an advantage in all of the data they have at their disposal. Using this data for developing rich content that is engaging and insightful is a great opportunity to differentiate themselves from their competitors.
To really benefit from social technologies, companies must transform their thinking, processes and approach to these new tools. They will need to become more open and less reliant on traditional acquisition approaches. Ultimately, the successes that can be realized from social media sites will depend on how eager companies are to integrate them into their customer facing systems.