2020 Foresight: Retail Banking and Social Media - Do the Ends Justify the Expense?

2020 Foresight: Retail Banking and Social Media - Do the Ends Justify the Expense?

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Social media presents a valuable opportunity for retail banks. As internet access and smartphone adoption increase, a growing number of internet users are becoming involved with social networking. Companies are changing their business models and product offerings to be able to cater to the ballooning market of social media users. Banks and other financial institutions are engaging customers with social media, which is shaping up as a strong channel to promote new schemes, identify customer needs and receive feedback. Although the use of social media remains risky territory for many banks, some have started to explore opportunities in this channel and have set out many best practices examples that can act as guiding principles for other banks and financial institutions.
A primary question plaguing the banking industry on the use of social media concerns return on investment (ROI). There are doubts over the credibility of social media as a key component of business models due to a lack of tools to measure quantifiable results. The potential benefits are more of qualitative in nature. Despite initial skepticism by retail banks, social media is expected to emerge as a complimentary channel, rather than replacing existing channels such as television and newspapers. Financial services companies use various channels to market products and services, and consumer opinion is now measured as an aggregation of experiences across these channels. Over the next five years, banks are expected to focus more on synergies that can be generated by social media and other key channels, rather than calculating ROI in the social landscape.

Key Highlights
  • Social media marketing has gained increased focus, and retail banks are changing their business models and product offerings to cater to the ballooning market of social media users. Social media interactions provide companies with a platform to reach out to customers and deal with issues in real time, increasing both the quality of their service and levels of consumer trust.
  • The increasing prevalence of the internet and widespread adoption of smartphones have fuelled social media expansion, with more than half the internet population now engaged in social networking. While Facebook, Twitter and LinkedIn have established themselves across the world, local social networks such as Vkontakte and Sina Weibo are more widely used in Russia and China.
  • Although the use of social media remains risky territory for many banks, some have started to explore opportunities in this channel and have set out many best-practice examples that can act as guiding principles for other banks and financial institutions. There is increased focus on the use of analytical tools, capitalizing on expertise of third-party professionals, and use of social platforms to engage customers in real time to improve brand image.
  • Retail banks are yet to fully exploit the benefits pertaining to their presence on social networks. A number of banks have still not made significant progress in social marketing, and others have also kept their investment to a low level due to limited awareness, concern for data security, as well as the legal and reputational risks associated with the media. However, despite initial skepticism by retail banks, social media is expected to emerge as a key complimentary channel for business development and banks are expected to focus more on synergies that can be generated by social media and other key channels over the next five years.
Scope
  • This report provides a comprehensive analysis of social media marketing strategies adopted by the retail banks across key emerging and developed markets.
  • It covers key trends and provides analysis of various stages in the use of social media by retail banks, with each stage's potential to influence customers.
  • It details various operational, technological and regulatory issues and challenges faced by retail banks while adopting social media marketing strategies.
  • It covers industry best practices and an effective framework for the adoption of social media as a marketing tool.
  • It provides case studies on social media marketing strategies implemented by various retail banks.
Reasons to Purchase
  • Understand the dynamics of the social media landscape across key markets worldwide.
  • Assess the current and future opportunities of social media marketing in retail banking industry.
  • Gain insights into the social media marketing strategies adopted by retail banks in key developed and emerging markets.
  • Gain insights into key issues and challenges to devise strategies and gain a marketing advantage.
  • Understand the implementation of industry best practices through detailed case studies.


Table of Contents

1 Executive Summary
2 Global Snapshot of Retail Banking in Social Media
2.1 Stages of Retail Banking in Social Media
2.2 Trends of Retail Banking through Social Media
2.2.1 Value perceptions across key segments
2.2.2 Key trends
3 Regional Analysis of Social Media in Retail Banking
3.1 Emerging Economies
3.1.1 Brazil
3.1.2 Russia
3.1.3 India
3.1.4 China
3.2 Developed Economies
3.2.1 The US
3.2.2 The UK
3.2.3 Germany
3.2.4 Australia
4 Issues and Challenges
4.1 Operational Challenges
4.2 Technological Challenges
4.3 Regulatory Challenges
5 Best Practice and Case Examples
5.1 Best Practices
5.1.1 Framework for effective adoption of social media
5.1.2 Operations best practice
5.1.3 Best practices in marketing and promotional campaigns
5.2 Case Studies
5.2.1 Citibank India using social media to increase online card use
5.2.2 Guaranty Trust Bank takes banking on Facebook
5.2.3 BBVA uses social media to improve customer loyalty
5.2.4 ING Direct's application of Twitter as a risk management tool
5.2.5 ICICI Bank improving customer convenience by capitalizing on popularity of Facebook
6 Appendix
6.1 Methodology
6.2 Contact Timetric
6.3 About Timetric
6.4 Timetric's Services
6.5 Disclaimer

List of Tables

Table 1: Impact of Social Media on Banks' Business Structures
Table 2: Social Media Across Retail Banking Functions
Table 3: Global Markets by Unique Video Viewers, December
Table 4: Social Media Marketing in Brazil
Table 5: Presence of Retail Banks on Social Networking Sites in Brazil
Table 6: Key Banks in Brazil and their Popularity on Key Social Networks
Table 7: Social Media Marketing in Russia
Table 8: Presence of Retail Banks on Social Networking Sites in Russia
Table 9: Key Banks in Russia and their Popularity on Key Social Networks
Table 10: Social Media Marketing in India


Companies Mentioned:

Facebook
Twitter
Linkedin
Citibank
Lloyds
Capital One
American Express
Orkut
Tumblr
Banco do Brasil
Itau Unibanco
Bradesco
YouTube
Promsvyazbank
Vkontakte
Stroycredit
Bank24.ru
Odnoklassniki
Sberbank
VTB Bank
Alfa Bank
Bank of Moscow
HDFC Bank
ICICI Bank
Axis Bank
Sina Weibo
Qzone
Tencent Weibo
Pengyou
Renren
Bank of America
Chase
Wells Fargo
Barclays
NatWest
HSBC
Halifax
Nationwide
Tesco Bank
Commerzbank
Deutsche Bank
ING DiBa
Targobank
Volksbank
National Australia Bank
Commonwealth Bank of Australia
Westpac Banking Corporation
Australia and New Zealand Banking Group Ltd
Suncorp Bank
SunTrust Bank
Cookerly Public Relations
SapientNitro
Hootsuite
Guaranty Trust Bank
Banco Bilbao Vizcaya Argentaria (BBVA)
ING Direct Canada