Turning the Tide

A point of view
Introduction
The social media boom has coincided with the global financial crisis. This means that banks are being most talked about at a time when they are least popular. And on social media, not only is every comment highly public - it also has the potential to go viral, whereby the negative sentiment could snowball. To complicate matters further, the banks ability to respond is often restricted by concerns about regulatory compliance, privacy and security. The prevailing public cynicism also impacts the success of the banks own social media initiatives, with the result that many well-meaning campaigns are not well received, and actually end up being counter-productive. This paper aims to explore ways in which banks can reverse the tide of negative sentiment and make customer opinion work in their favour, rather than against them.

The Potential Risk

Despite the apparent protection of regulatory policy, big banks are currently at their most vulnerable. Until recently, their customer base was largely captive, in the sense that customers felt that the only viable option to a big bank was another big bank. And since all the big banks seemed largely undifferentiated, there was not much to choose between them, which reduced the likelihood of churn. The lack of clear differentiation also meant that negative public opinion was not regarded as a major worry, because it did not specifically target any one bank in particular - it was equally directed at all their competitors. Suddenly, this scenario is changing. In the first place, the nature of competition is changing extremely quickly, with new players finding innovative ways to bypass the banking license requirement. Secondly, - thanks to social media - customers are also discovering these new options much faster,

and are in a position to compare their pros and cons to those of the big banks. Why is this trend a cause for concern? It is mainly for three reasons:
Small-time competitors are emerging as viable alternatives: Every time a big bank slips up, it seems to drive more people to the credit unions and local banks, and social

media is a key driver of this trend. Witness the response - not just the social media outcry, but also the actual account closures - when one of the American Big Four banks announced a debit fee.
Apart from such spontaneous movements, there are organized initiatives like Bank Transfer Day in the US, and

Move your Money in the UK again driven by social media.

Also, smaller banks are getting very creative in their use of social media. The Build a Billboard campaign by a

Michigan bank is a great example - it crowd-sources, it is fun, and it highlights the banks key differentiator against the global banks.
While credit unions and local banks have used negative advertising against big banks even in the past, their

campaigns today are getting a lot more effective because of the following reasons:
Firstly, social media offers them a great deal of visibility as clever campaigns go viral purely because of their

entertainment value.
Secondly, any attack on the big-bad-banks resonates very strongly with their irate customers. New competition is emerging, and it is dynamic: Banks may need to change their definition of competition.

Non-banking institutions are providing banking services that are getting increasingly popular. Banking fronts like Bank Simple and P2P exchanges like Zopa are just two examples of players that are openly leveraging the prevailing anti-bank sentiment to draw customers. Going forward, even telecom companies could prove a threatthe already popular mobile wallets are just one example of how telecom companies can leverage their technological advantage. As more new players find innovative ways of getting around the requirement for a banking license, all this competition could open up the market like never before.
The customer is getting impatient: Social media has empowered customers across industries, with brands

striving to fulfill their customers slightest - and fast-changing - expectations. This empowered and informed customer now expects similar treatment from his bank. Hitherto, changes in the banking industry have been fairly slow and deliberate, and customers have largely been followers rather than drivers of change. This is not likely to be the case any longer. As customer sentiment approaches critical mass, the transformation in banking will be dramatic.

A Possible Solution
A bank has restrictions on what it can say and do on social media. However, customers are not bound by these regulations, and can freely voice their opinions about every aspect of the bank - its products, services, staff, and management. What is more, their opinions are perceived as being unbiased, and worthy of trust. When these customers talk, their peers listen.

If these very vocal customers could be converted into brand advocates for the bank, the results could be spectacular. The challenge is that in recent times, the waves of customer opinion have been largely negative, working against the bank rather than in favour of it. They have even taken the form of mass movements against large banks in general, as in the case of the Occupy Wall Street and Bank Transfer Day initiatives. Changing these perceptions is not going to be easy. However, given that the potential benefits are so huge, it is definitely a possibility worth exploring.

Specific Steps
Brand Differentiation - The lack of differentiation among the big banks might currently serve to protect individual banks from being singled out as targets of public ire. It is actually counter-productive in the longer term, though, because it just reinforces a negative association. In fact, the prevailing sentiment against the industry as a whole actually makes it easy for any first-mover to improve its own image at the expense of the other banks. Take the example of the leading Australian bank - the archetypal typical big bank - that managed to reinvent their brand by actually leveraging the tide of negative sentiment, making it work in their favour. Basically, the bank announced that they were dissociating themselves from the rest of the big banks, and the unpopular practices associated with the industry. Their break-up campaign quickly went viral, and the rest is history. Internal Cohesion - Social media exposes organizational silos within banks. Internal communication within the bank is critical, because the bank needs to send out a consistent brand message through all that it says and does, and to ensure a consistent brand experience across communications channels, geographies and business units. All marketing channels need to be aligned with each other as well as with the organizational leadership. When a British banking giants Facebook campaign coincided with the breaking of the Libor story, it made the campaigns message of frugality seem completely out of place. While a seamless customer experience is not always easy to achieve - especially if it involves working across the banks internal organizational silos - it is increasingly crucial. Integrating Social Media - Almost every big bank has an active presence on Twitter, and usually on Facebook as well. However, customers usually wont find these links on the banks corporate website. One of the largest American banks has a page devoted entirely to social - with comprehensive links and guidelines - but this, too, is not easy to find. For many big banks, even the Twitter handle for customer service is not listed among the helpdesk/customer service touchpoints. Not only does this make things difficult for the customer; it also sends the wrong signals about the banks seriousness regarding social media engagement.

Social channels are integral brand touchpoints and should be treated as such, instead of being handled in isolation. Recognition of the Employee as Touchpoint - With social media, every employee becomes a potential touchpoint - because every employee can now interface directly with your customers. This makes employee engagement more critical than it has ever been. Employees of world-leading banks regularly disclose trade secrets and describe unethical practices - there are several dedicated blogs on these themes. When an employees resignation letter went viral, it cost the worlds most powerful investment bank billions of dollars of market value as their stock plummeted the next day. (Soon after that, incidentally, the bank hired a social media strategist, and started a Twitter account!) Internal social networks can help sound out your workforce, so that you know what your employees are thinking before the rest of the world does. They also help improve employee relations, facilitate crowd-sourcing and collaboration on ideas, get buy-in from employees and create an engaged workforce that can be the biggest advocate for a bank. Owning your Community - Banks might find it useful to create their own blogs, forums, or online communities, instead of relying solely on external channels like Facebook and Twitter. While banks typically create communities only for their Corporate Social Responsibility (CSR activities or for specific groups like retirees and students, a generic community for all customers provides a far greater level of engagement. A Texas-based financial services group - well-known for its services to military personnel and their families - has created communities which are vibrant conversation hubs. Apart from being a great way to engage with your customers, your own online community also provides highly relevant data. Controlling Mobile Payment Channels - Banks had a unique advantage over other industries in that they had access to data on almost every aspect of their customers lives - their lifestyles, spending patterns and life milestones. As the mobile phone replaces the credit card, banks need to ensure that they do not abdicate this space to telecom operators. Mobile payments provide the opportunity to collect very useful data on spending patterns. Co-relating data on preferred products, payment methods, locations, patterns between time-of-day/week/year, repeat purchase patterns, etc could provide invaluable insight. It also facilitates much better segmentation and targeting. Banks should retain control of mobile payment channels - whether through near-field communication (NFC), banktelco collaboration, or any other means - and leverage the wealth of information it provides.

Checking the Basics - Banks need to be perceived as genuinely customer-centric - transparent, responsive and helpful. Apart from assurance of security and privacy, friendly interfaces, speed and responsiveness, also ensure that your customer experience is consistent across touchpoints, and that all communication is simple and clear (Customers, already intimidated by the complexity of the content, often interpret the language as a deliberate attempt to obfuscate - hence the high numbers of negative posts about subjects like hidden fees). Sustaining Effort, Sustaining Relationships - Even if initial attempts at dialogue and transparency are greeted by cynicism, continue to be genuinely customer-centric - in the long run, it will pay. And if your initial campaign is highly successful, remember that is only half the battle won. For the Australian bank mentioned earlier, the break-up campaign was the easy bit. In the year that followed, they were subjected to continuous scrutiny, and criticized whenever they did not seem to live up to their initial promise. On social media, however, even criticism is an opportunity to build and strengthen customer relationships. A year-and-a-half down the line, the bank has the highest customer satisfaction rating among the large Australian banks. A bank that is seen to be making a genuine effort can evoke a highly positive response, without even having to run a major campaign. A leading South African bank is a case in point - and the success of their efforts is borne out by the vociferous social media support they received, when the banks claims were questioned by a competitor. That is what makes social media such a powerful channel, not just to evoke interest, but to build and sustain relationships.

Conclusion:
Customer advocacy could be a powerful tool, particularly for banks constrained by regulatory concerns regarding suitability, adoption, entanglement, approval, supervision and record-keeping. However, engaging the customer calls for sustained effort, and a level of commitment and transparency that banks are sometimes culturally unprepared for. Once the initial hesitance is overcome, though, banks will find that they have earned themselves a loyal community of advocates - one that recommends their brand, products and services through enthusiastic word-of-mouth.

Authors profile
Reeta Mehrishi is a Social Media Analyst. As part of her current role, she monitors trends in Social Media and Digital Marketing and develops enterprise-specific strategies. She leads a team of analysts with expertise in various industry verticals

Contact For more information about TCS' Banking & Financial Services, email us at bfs.marketing@tcs.com About Tata Consultancy Services (TCS) Tata Consultancy Services is an IT services, consulting and business solutions organization that delivers real results to global business, ensuring a level of certainty no other firm can match. TCS offers a consulting-led, integrated portfolio of IT and IT-enabled infrastructure, engineering and assurance services. This is delivered through its unique Global Network Delivery ModelTM, recognized as the benchmark of excellence in software development. A part of the Tata Group, Indias largest industrial conglomerate, TCS has a global footprint and is listed on the National Stock Exchange and Bombay Stock Exchange in India. . For more information, visit us at www.tcs.com

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