FreshNetworks Blog

When working with the big banks and insurance companies, as they embrace the potential of social media, their adoption of change can be fairly slow. The highly regulated (and risk averse) financial services industry often lacks the appetite to engage in online social conversations and (they could argue) “why do we need to?”. The answer is that, if you don’t, then you get left behind. There are competitors and some new entrants already building a successful social media presence.

As an example of a new entrant, in the banking sector, I’ve been following Zopa for some time. It started in the United Kingdom, and promotes itself as the first marketplace for social lending. This means that members of the Zopa community lend and borrow money with each other, sidestepping traditional banks. The premise is that both lenders and borrowers get better rates, because Social Lending is more efficient than traditional banks, which, with large overheads, must take bigger margins on the money that passes through them.

With over 400,000 members, Zopa appears to have hit upon a successful formula, and one that is now being copied in other countries, such as Prosper in the US, Smava in Germany and Boober in the Netherlands

And because it has empowered their online community, it becomes natural for it to add the social media features that further enhance its proposition, such as frequent blogs and online conversations between its members.

Time will tell whether this business model will be successful and sustainable. But it demonstrates that a new entrant into the marketplace such as Zopa can shake-up an otherwise cautious banking industry, and maybe move them faster towards embracing social media. It’s going to happen – it’s simply a question of when.

Read all our posts about social media for financial services

Many community manager positions advertised online ask for someone to help supervise and develop a newly launched community. In my opinion this is far too late to look at employing a community manager. They should be involved from an early point in the development cycle, ideally when plans for the community are still being developed.

There are a number of reasons why ensuring the online community manager is onboard from this early planning phase:

1. They can get to know the platform the community is built on
   Knowing your platform, how to add and update content, how to moderate, how to make changes to user profiles is core to the community management job.
2. They can be involved in the user testing
   If your community manager finds something awkward or confusing you can be certain your community members are also likely to.
3. They can prepare engaging content
   Having time to prepare content for your community, be it forum topics, a list of future polls or a schedule of blogs will aid the smooth running of the community in the first few weeks.
4. They can be involved in seeding the community
   Being there to seed the community with content and invite those all important first few members in allows a community manager to identify trends and get an instant feel of how the community is likely to develop.
5. They can develop internal relationships
   Often under-rated, having the time to develop relationships with other employees who may provide content, or be able to help with questions that arise about your brand or services, provides long term benefits to the community.
6. They will have time to develop a library of external resources
   Sourcing resources such as external blogs and relevant news articles allows you to quickly update the community and provide a talking point for community members.

When that “go live” date passes and you offer your community out to the world, having a community manager who has been given a chance to familiarise themselves with the environment and build internal relationships before the traffic arrives will only help with the long term success of the community.

Over the past few months, I have consulted with around 20 banking and financial organisations, and I have got “under the skin” of their frustrations with, and their aspirations for, the untamed beast that is social media. In this series of posts I will outline the opportunities for financial institutions when entering into an online dialogue with customers in a risk-averse industry. I will look at why the answer isn’t simply a Facebook page and Twitter feed, but instead it’s about identifying and engaging with an online community that has a shared interest and the passion to get involved. There are some great examples (often from the US), and some not so great, that will enforce my argument.

Let me start by challenging the convention that financial organisations benefit from a Facebook fan page. It can help, of course, but the benefits are usually overstated. There is consensus among my clients that simply looking at the volume of Facebook fans flatters to deceive. If this was simply a numbers game then Facebook would win every time. So, instead, let’s look at the quality of the fans, not the quantity. Many of the Facebook fans that have been gathered by the banks and the insurance companies are employees of the organisation using the channel as another route to keep in touch with their business and each other. And, in general, the Facebook fans from the target audience (i.e. the prospective customers or existing customers) are generally inactive, and certainly more inactive than conventional Facebook fan sites.

The Facebook dilemma was nicely summarised by a comment on mashable recently as follows:

FaceBook taught its members that the social media platform was for socializing… not for purchasing. The wrongenvironment for business! The argument of ‘Be where the people are’ does not always apply. I have been to funerals with a lot of people but that does not make it a good place to market. FaceBook is packed with members who are there for one purpose only… to interact with friends and families. The fastest way to get me to de-friend you is to try and sell me something!

Preparing my keynote presentation for the Dutch Marketing Conference Digitaal willen we allemaal in Utrecht later this month I’ve been considering both the danger of building your social media strategy on tactics (“We need to use Twitter” or “We need to use Facebook”) and also the role of the social media agency. I wrote a post about how long-term success in social media is about more than tactics – the importance of exploring and critically evaluating why you are using social media and how you will measure success rather than jumping straight to tools and tactics. The second part of my presentation will consider the role of the social media agency and how and why they should work with brands.

The best person to represent your brand online is you

It may seem counter-intuitive for us to say this (FreshNetworks is a social media agency after all) but the best person to represent a brand online in the long-term is probably the brand itself and not an external agency. Social media should sit alongside your existing channels of engaging customers and should provide a way for you to have a sustainable relationship with them. You should be having conversations with them, working with them, sharing ideas and learning from them. The power of this engagement being with the brand directly is huge. And the value to any organisation of having a route direct to your customers and stakeholders is great.

However for many organisations this is a daunting prospect. Who should represent your brand? What part of the business do they sit in? How do you engage people online? What do you do if people talk about you? How do you find brand advocates and what do you do with them once you’ve found them? These and many other questions are often raised when brands think about engaging online using social media. And these are jsut some of the reasons a social media agency can help, at least in the short- or medium-term.

Why a social media agency can help your brand online

So, whilst a brand is the best to represent itself online in the long-term there can be strong, pragmatic reasons for working with a social media agency first. At the conference later this month, I’ll be talking through three main reasons but would love to hear your thoughts:

1. When you start engaging online a different set of skills are required

Building a growing social media engagement is hard work. It takes skills and experience to grow a community of people and manage the conversations and discussions in a way that is of interest to the community and of use to you as a brand. Taking the overall strategy and turning this into a set of tactics that you use to engage customers and other stakeholders needs experience and people who have been there before. Once the engagement is up-and-running a different set of skills are required and this is really where the brand comes to the fore.

2. It can be difficult to know where social media sits in an organisation

For many organisations it is difficult to know where social media, and engagement online, should sit. How you organise yourself is often very different to how customers and stakeholders think of you. One of the real benefits of engaging people online is that you can get real insight into your organisation that helps your brand. People won’t split themselves in the same way that you do and so a PR team may find itself being presented with new product ideas, or an insight team with needing to react and respond to customer complaints. This can be difficult and it takes time for social media, and the benefits it brings to your organisation, to be fully realised. A social media agency can act as the glue between you and the people you are engaging online and also help you to learn and to understand where it can fit into your organisation (or indeed what changes are needed internally to make the most of it).

3. Most organisations would benefit from social media skills transfer

Most brands could benefit from learning and practicing the skills needed to engage customers and stakeholders online. The role of the online community manager is becoming more and more established and is one that businesses can hire. The role of the social media manager (in its broader sense) is still developing and requires a number of skills and experiences. You need to know how to engage people, facilitate discussions online, run campaigns, respond in a crisis and to work with customers to co-create new ideas. You also need internal management skills to make sure you engage the appropriate people across your business and engage them at the appropriate point to contribute to discussions online. Finally you need a range of analytical and reporting tools so that you can analyse and report on the impact the engagement is having. Any good social media agency will use a team of people with different skill sets to help you in all these areas, and then coach and mentor internal to raise skill levels internally and transfer these skills to you.

So the most appropriate solution for many (if not most) brands is to work with a social media agency at first but to plan to transfer skills internally and take more responsibility for representing your brand online as the engagement changes in style and nature and the relationships you are building online grow.

At FreshNetworks, we aim to bring you the best posts in social media, online communities and customer engagement online. In case you missed them, find below our top five posts in March.

1. The seven harsh realities of social media for any brand

In our most popular post last month we looked at seven ‘harsh realities’ for any brand getting started in social media. There can sometimes be a tendancy to ‘do social media’ without any proper thought about why and what you want to achieve. Facebook is not always the answer and what works for one brand will not necessarily work for another brand. In this post we look at seven harsh realities of social media unless you get your planning and strategy right – from nobody to read your blog, to users will not generate content.

Working with any social media tool, just as with any marketing or communications tool needs proper thought. Here we look at the hash realities of using social media if you don’t put in this thought.

2. The Economist on Social Networking

At the end of January, the Economist published a special report on on social networking.Their special report on A World of Connections, provided an excellent overview of the current state of social media for those still trying to get to grips with it. You can download a free pdf of the report here. Or check out our summary of key highlights in this post.

3. Russia: the fourth largest social networking market in Europe

In a post from almost a year ago we look at data showing that Russia was the fourth largest market in Europe for social networks behind the UK, Germany and France.

4. How the Global Fortune 100 are using social media: some statistics

A useful survey from global PR firm Burson-Marsteller looks at the ways in which the Global Fortune 100 companies are using social media. The tools they are using and how they are developing a social media strategy. The survey highlights the ways in which these firms are using social media and is also insightful in terms of the tools and platforms (Twitter, Facebook, YouTube or a corporate blog) they are using. It is interesting to compare the use of the different tools – Twitter is the most popular and blogging the least. And to compare how behaviour differs by regions – particularly the differences between Asia-Pacific and the US and Europe.

5. Why Drupal is a great social media platform (in layman’s terms)

Five reasons why the content management system Drupal is a great social media platform. Easily explained in layman’s terms. From having the component modules that are suited to building an online community, through being great for SEO to good scalability. Drupal is a popular CMS and social media platform used by large brands and governments.