Do banks need a shower in social media?
January 12th, 2011 by Jon Clements
Week 2 of 2011 and already UK bankers are back on the ropes in reputation terms.
Barclays boss, Bob Diamond’s appearance in front of the Treasury Select Committe yesterday is described by the Mirror’s Ros Wynne Jones as a “despicable performance”; the Telegraph’s report on Diamond’s roughing up by MPs quotes Tory, Andrea Leadsom, who trounced the banker’s claim to high levels of customer satisfaction and support for SMEs saying “the evidence doesn’t stack up”.
Elsewhere in the banking firmament this week, RBS has been fined £2.8m for what the Sun calls “shocking customer service”. And late last year, the British Social Attitudes survey showed that the public’s trust in banks as well run and managed has plummeted from 90% of people in 1983 to 19% today – a lower trust level than for the media and trade unions.
So, what are the banks to do?
Niall Harbison at The Next Web reckons that using social media provides “A great opportunity for them [banks] to chip away at their negative reputations”, citing Citibank’s launch of a Twitter feed to field customer complaints and training 100 staff to handle this new customer engagement channel.
As Harbison recognises, a general banking embrace of social media may be slow in coming, as being open is “not in their DNA”. But can banks afford to ignore the social media movement if customers are demanding better customer service and resolution of complaints?
Closer to home, one bank that has taken social media seriously is First Direct. It’s social media strategy first came to PR Media Blog’s attention in November 2009 and since then it’s embarked on open dialogue with customers in its “Talking Point” online forum and maintains a regular Twitter presence - though it appears to be a more promotional than customer engagement tool. Then again, if that’s what the customer wants, so be it.
Just a thought, but maybe reinvesting a smidgen of a banker’s bonus in genuine customer interaction via social media may lay the seeds for a resurgence in public trust and satisfaction for the banks.
Twitter Trackbacks for Do banks need a shower in social media? » pr-media-blog.co.uk [pr-media-blog.co.uk] on Topsy.com Says:
[...] Do banks need a shower in social media? » pr-media-blog.co.uk pr-media-blog.co.uk/do-banks-need-a-shower-in-social-media/ – view page – cached Week 2 of 2011 and already UK bankers are back on the ropes in reputation [...]
David Phillips Says:
Yes, but….
Overspending politicians have brought the financial structure of a lot of economies to their knees. Having borrowed to the hilt from the banks to bribe electors, among other financial institutions, and now having to re-structure debt, what can they do. Huff and Puff. Not an edifying experience.
Meantime the interesting thing about Bob Diamond’s meeting is that his bank did not take money from the government and he did make it clear that failing banks should be allowed to fail. That sounds like a competent man worth his salt.
But the pot calling the kettle black is not a good ploy for politicians.
The real issue in my mind is the nature of public relations inside banks. Is it acceptable for relationships between banks (who trade inter-bank) to be at such a low ebb that they cannot trust each other with their own financial instruments. Trust is a PR issue and so I guess that the bank crisis is more a PR issue than a bankers issue.
We cannot, as a profession just preach. We have to do as well and when we don’t we must not blame others.
banking PR reflects on the whole profession and its not nice or comfortable.
John Owens Says:
Investing in core skills would be a better way forward.
1) Tell less lies, to yourselves first then the outside world.
2) If you are supposed to be safe, secure and wise – make it so rather than following every fashion like dogs on heat.
You take in money, re-invest or loan it out wisely, allow savers to earn more than zero interest and let lenders have an opportunity to make more out of the money than you charge them – and en route you make a profit.
It worked for years. What was so hard in all that ? Why did you change your model ?
Adopt the 5 p’s of Marketing and get your Product right then worry about what Promotional channels to use to tell us you have done.
John
p.s.
In the meantime. If you have any PR influence at all tell the guy from Barclays that NO, now is not the right time for the bankers to stop apologising.
Making a quick turn on some investments using British taxpayers to underwrite your risks while they are losing out is no way near enough recovery !
Amanda Brown Says:
Hi Jon, thanks for the link – when it comes to Twitter we’re pretty clear on the page that it’s a media focussed stream, that said, when we do get people talking to us we try to respond reasonably quickly, and pass on queries to the relevant part of the business. Talking Point is entirely about customer engagement. We have a team that monitors it almost 24 / 7 and responds to customer queries / feedback and this all gets fed back into the business. In fact if you check back over the next few days you’ll see an example of what I’m talking about with something we’ve got coming up. (http://bit.ly/i0V0zT)
Jon Clements Says:
David, John, Amanda – thanks for reading and for your comments.
Amanda – I wasn’t criticising your Twitter feed but just noting that the majority of the tweets I saw (looking back to October last year) were either sharing news or retweeting other content rather than customer engagement. As I mentioned in the post, customers must be content with that and are clearly getting the service interaction they need via your other channels. Either way, the work First Direct is doing via social media sets you apart in the industry and others should learn from it.
Should banks use social media to say sorry? No - have they anything to be sorry for? | Contently Managed - Digital PR, Social Media, Traditional PR Solutions and Strategy Says:
[...] Jon Clements has written a good piece over on the PR Media Blog about banks and social media that’s well worth a read given the recent fury over banking bonuses but it got me thinking [...]
Andy M Turner Says:
Jon, the answer is undoubtly ‘no’ in my view because the problems most of us have with banks are systemic and long standing. So turning to social media would be like placing a sticking plaster over a great, big gaping wound. You’re making the mistake of assuming that all banks (and bankers) give a flying toss about what everyone else thinks about them.
For years they’ve operated a deft strategy of collectively hiding from speaking to the media, occasionally wheeling out the politically-savvy Angela Knight of the British Bankers Association to defend themselves when under attack. The stark fact is they know consumers and most small businesses have no choice but to use them. This UK market dominance of the ‘big 5′ (HSBC, Lloyds-TSB, Barclays, RBS and the recently-enlarged Santander) is something successive governments have known about for years but have never really been willing to do anything about.
The credit crisis was an unprecedented opportunity to change things for the better but it was missed and all that happened was that there are now fewer market players offering banking services.
First Direct has always been different but remains too small to do anything but feed off the crumbs from the others’ table. We now have some new entrants such as Metro (in London only so far) and may soon have Virgin (once Sir Richard overcomes whatever obstacles are in his way) but perhaps the real game changer will be Tesco, which was making some very bullish statements in the FT before Xmas. Whatever you think of them, they certainly know about service and customer care.
Craig McGill Says:
Jon, a cracking post. I think in part the problem is mindset – bankers do see the world different to many other people – but also the conservative nature of the financial industry. It’s a reactive industry in terms of media, not proactive (disclaimer: I used to do a little business journalism and did PR for a major UK bank) and the best social media and digital engagement involves being proactive (and taking negative flak without running away).
I’d love to see the financial sector do more with social media. I posted some thoughts over at A good post and I’ve added some thoughts and ideas here: http://www.contently-managed.com/blog/2011/01/13/should-banks-use-social-media-to-say-sorry-no-have-they-anything-to-be-sorry-for/
Jon Says:
Craig
Thanks for that!
It probably runs even deeper than mindset into the whole cultural fabric of the sector.
Personal finance can’t help but be a torrid affair between customer and company when things are going badly. However, it strikes me that the braver providers – and those that will help their own reputation bank in the bad times – will be those that choose to engage and establish a different relationship with the customer.
With the resources at their disposal, it shouldn’t be a question of investment, but taking a leap of faith.
Jon Clements Says:
Andy
Thanks for your comment and for the frank counterpoint you put forward.
Looks like you’re not on the look-out for a banking client any time soon!?
Andy M Turner Says:
Jon, any bank that wants to work with me as their ‘critical friend’ would have to stand in line behind the dictators of dubious African regimes, oil sands extractors, FIFA and Darth Vader himself – all of whom would be preferable as clients (if Sir Tim Bell didn’t already represent them of course).
It’s not hard to be vitriolic about banks – I just wish we could see some more concrete, Cantona-style action. Although he failed, he reminded us that the French know better than most how to take direct action when something upsets them badly.
If Craig McGill is going to pimp his blog then I’m going to as well. Here’s the entry, in which I conclude ‘the only sensible motive for walking into a bank has to be robbery’
http://bit.ly/bd3Kwm
Jon Says:
Andy
When you say Cantona-style action, I assume you mean propogating the mass withdrawal of bank account deposits as opposed to launching kung-fu style attacks on members of the public (see link below you may recall)?
http://www.youtube.com/watch?v=u-WmfTIRUWY
Andy M Turner Says:
Jon, thanks for sharing that. Yes, it was the former. I’d forgotten how ‘passionate’ a player he was! Launching kung-fu kicks on members of the public cannot be condoned, however much provoked. But I’ll bet there are plenty of people who’d be very happy to see their feet connect with Bob Diamond’s rear end, not to mention Alfred Saenz, the liar in charge of Santander who’s just lost his appeal and had his jail term increased.
Just to reinforce my original point about banks dealing with more fundamental issues before they dip their toes into social media, here’s an example that defies logic. I was recently in Rotherham town centre (don’t ask) and found myself deliberately back tracking a little to check that I had, in fact, just passed three identical Santander branches, all within 100m of each other. Imagine the cost of that one decision, in premises, staffing, re-branding and unnecessary duplication of services?
Joe Wiggins Says:
I think there are two problems here. The first is that banks can’t decide internally who should own social media so normally this get’s pushed towards corporate communications because of the reputation risk. It’s then a significant challenge for the communications team to convince the rest of the business that social media is a tool for customer service over and above PR. Don’t underestimate what a big battle this is.
The second problem is that even if social media is recognised as a significant opportunity to improve customer service, it is likely to get lumped in the generic ‘internet’ pot, which as a channel normally has much smaller budgets than the branch networks.
I think the pace of social media scares banks. They are used to keeping customers at arm’s length via call centres and taking weeks to deal with complaints via post. Unless regulation states that they must respond to social media complaints within 15 minutes, they aren’t going to do it.
Jon Clements Says:
Joe
Great comment. From your background it’s clear you have an insider’s view of the challenge facing banks.
And yet, it’s ironic that such a critical customer-provider relationship – one that has the potential to cause probably more angst than any other – would not be subject to the latest thinking and customer engagement approach, which social media clearly is.