The Bankwatch

Tracking the consumer evolution of financial services

The Social Media Myth | socialmediamyth.com

In one of the clearest pieces on social media, Michelle covers it well in this white paper entitled The Social Media Myth. My favourite quote, and an initial hint as to the content.

Because people don’t go on social networking sites to hear your pitch – people go on social networking sites to talk to their friends!

She answers the question on what is the one thing you need to know.  I won’t steal the reports thunder, so you can download and read for yourself, and I do recommend it to all banks.  As a hint, it differentiates beteen building link credibility and building personal credibility.  Marketers who read this, must keep an open mind because it requires new skill sets, and much of what is required here is not a requirement for marketing departments, and will engage other departments.   There are useful things here that all banks can participate in, no matter your cultural issues.

Written by Colin Henderson

February 2, 2009 at 11:43

12 Responses

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  1. People don’t watch TV for the commercials, read magazines for the ads… or generally do ANYTHING in order to hear advertisers pitches. So is that more of a comment on the value of advertising, or the appropriateness of social media as an advertising medium?

    Ron Shevlin

    February 2, 2009 at 12:01

  2. Colin,

    On one level I understand your view, but on the broader plane, I think you may be unwise to dismiss this.

    Sure, Facebook would be tricky to monetise. Of that there is little doubt.

    But don’t throw out the concept on the basis of one model. Take this for example.

    Henry Ford created the Model T. This was a popular car, but only for a specific section of the market.

    Did the wider market then decide that motor vehicles had no application for them?

    No, the market adapted the concept into a form more appropriate to what it needed – trucks, vans, motorcycles – even tanks.

    Its about the wider picture, not the initial sketch!

    Neil Robinson

    February 2, 2009 at 12:38

  3. I agree. Here’s another excellent resource, The Community Banker’s Guide to Social Network Marketing (December 2008) available for download at: http://www.docstoc.com/docs/2873849/The-Community-Bankers-Guide-to-Social-Network-Marketing.

    A couple other handy articles are:

    Bank Technology News “It’s About the Social Not The Network” http://www.americanbanker.com/btn_article.html?id=200901269RQJN5M8

    Bank Director Magazine “The Next Generation of Banking: Is Your Institution Ready for Them?” http://www.bankdirector.com/issues/articles.pl?article_id=12008

    Jesse Torres

    February 2, 2009 at 14:16

  4. @neil – not sure I agree with the metaphor. The Model-T highlighted through consumer utility, the additional potential for motor vehicles. The restriction was a choice for Ford in their manufacturing model.

    In the case of social networks, the restriction is not from the “manufacturer” per se – its is from the end users in that they are chatting with friends and do not want to be bothered.

    Now I agree if there is a middle ground that says, its ok to interrupt me in “this new and innovative way because I see value there” then of course the equation changes, but for now I buy the argument and approach suggested in the document for fear of alienating people before the model(s) develop further.

    Colin

    February 3, 2009 at 11:49

  5. I apologise for a somewhat inaccurate metaphor, Colin!

    The point I was trying to make is what we are seeing the seed-growth of something that will shape the products we make, provide, market, buy and judge going forward. So how do I arrive at that conclusion?

    Well, its like any technology, its not what it is, but what it enables. How do we market a product today?

    We pay an agency millions of dollars/pounds whatever to tell us what they think people want to buy. And this is the laughable part. Those agencies use social networking to gain that knowledge. They simply call it market sampling or focus groups.

    They sell us the knowledge we could have for free if we could find the courage to ask our own customers what they want from us. So why are we so afraid of people?

    Banks and large conglomerates surround themselves with submissive, unimaginative staff who are expected to toe the line and comply. Don’t make waves, don’t question, just do. Customers, well they kind of don’t play ball, do they?

    They question, they complain, they argue. Well, I’m not having that. I don’t want to talk to people like that. But why are they complaining?

    Because they don’t get what they want. But post-sub prime, the days of multi-million sum gambles on products is dying. To sell, we desperately need to know what people want because people won’t spend so easily any more. And they now hate banks. Like it or not we are going to have to engage with our customers.

    And no, we’ll never be able to gatecrash conversations on Facebook. But then again, that Model T could did bulldoze a quarry. But something that evolved from that initial idea did.

    Neil Robinson

    February 3, 2009 at 13:08

  6. @Neil – aha! Your comment is worthy of being its own post! I have nothing to add except – agreed! I was looking too narrowly at just social media tactics but the longer term promise is here!

    Colin

    February 5, 2009 at 01:27

  7. Thank you, Colin. I’d like to leave this with one last point. Social Networking is the logical extension of the empowerment of the consumer and the shift of power away from the producer.

    Before the Internet, we were driven by the producer. We had no input, we simply listened to a monologue. “Buy this, your life will be improved”, “Guinness is good for you”.

    As the Internet evolved, the consumer became empowered and began to have wider access to products. We could compare and choose better. We became knowledge richer. Power shift 1.

    As we became more connected, along came Social Networking. Now the monologue became a dialogue, we can say what we like and what we don’t. (HSBC Facebook campaign to remove student overdraught fees?). Power shift 2.

    But beyond this, could we see the producer becoming the servant of a market driven solely by “I want to have this made for me” rather than the producer saying “you will have what I make for you”?

    Is this the dawn of the true demand driven society?

    Neil Robinson

    February 5, 2009 at 04:11

  8. Wait, but…Guinness IS good for me right?!!?

    Dan Dickinson

    February 5, 2009 at 09:08

  9. Interesting posts and comments. There’s an extension to the valuable lament Neil post: a deep need for banks and financial services vendors to adopt “deeper” marketing that is indigenous to the social media. We at Royal Media Group have been running three social networks for the financial services industry since last August. What we have found is that there is a dramatic difference in the way people engage with the social network. They generally fall into two categories: A) those who talk “at” the network; and B) those who talk “with” the network. Those who talk “at” the network don’t interact with it; they don’t engage the network — and they are the site members who post marketing blather when instead they can post marketing messages that engage prospective clients. In other words, don’t just throw informatino to me about your product. First, understand me and my needs so that we can together understand whether your product is right for me.

    Engagement, that’s really what is missing at banks, to truly understand the customer wants. Social media allows for a type of interaction that is spot on for engagement. You can be “friends” with someone, which grants you permission to engage, without really being friends with someone, meaning you don’t have to invite them to your son’s wedding. We try to explain this to our networks, but some people don’t understand that, and end up losing a tremendous opportunity. The upshot is that in order to take advantage of social networks, banks need to commit in a completely new way to their own social networks. Obviously, this requires a remarkable commitment too adhering to brand values across the entire spectrum of an organization. It can be done, and it will work.

    JJ Hornblass

    February 5, 2009 at 09:48

  10. @Dan – best social media post here !

    Colin

    February 5, 2009 at 17:41

  11. @neil – re demand driven society. Have been reflecting on that and have to agree. There is a thing out there that few agree with, but I fundamentally believe will play out. Its called VRM (Vendor Relationship Management) that is centred on the idea that people own their own advertising and will accept it only when they want and on their terms.

    Colin

    February 8, 2009 at 13:51

  12. […] Archivado en: General — Álvaro Martín Enríquez @ 12:58 La semana pasada conocía por The Bankwatch un informe de Michelle MacPhearson titulado The Social Media Myth, en el que la autora, […]


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