Financial Providers Laughing on Other Side of their Facebook

When the words “Facebook” and “Twitter” first started making an auditory appearance in the upper stratosphere of banking boardrooms, they must have seemed so irrelevant as to be laughable.

With Experian’s recent release of a report describing the financial importance of the young generation of social media users however, it seems dismissive smirks are no longer so clever.

The report reveals “that this increasingly powerful group” wants “immediate information, instant decisions, faultless customer service and the ability to manage finances on the move. Providers that fail to tick all these boxes could fall behind.”

So important are these young and demanding button-clickers that the credit agency has even coined a name for them (cue drum roll) – “The Facebook Generation’”.

Experian’s report highlights what many have know for quite a while now; namely, that social media has changed the way buyers and sellers interact forever. A survey carried out by econsultancy.com revealed that 97.09% of people questioned said their buying decisions are influenced by social groups.

According to Ankur Shah, co-founder of Techlightenment: “With Facebook accounting for one in every six web pages viewed, financial services organisations need to use the unique insight capabilities of social media to create a robust digital strategy that identifies customer needs.”

While some financial services companies are dismally failing to keep up, others are bravely journeying into the shifting sands of social media land.

In June, Morgan Stanley launched a pilot programme that allowed 600 of its financial advisers to market themselves and share their expertise through sites such as Twitter and LinkedIn. If, at the end of the year, this has proven successful, the firm’s 17,800 employees will join in.

Citi and Bank of America have also made a start, using sites such as twitter Twitter and Facebook to improve their customer service. More modestly, and rather sweetly, the Bank of England says that it uses “a range of social media channels to promote public understanding”. These include a flickr account, where consumers can enjoy “images from Bank publications, together with photographs of senior staff, gold and Bank premises”.

From a financial services perspective, the problem with social media relates to the strict regulatory framework in which they operate. The industry wonders aloud at meetings of the Financial Services Club how it is supposed to use social media when it can’t promote its services and needs things like archives of communications. It seems that no-one really has the answers. While we wait patiently, we’ll try and ignore the rumours that Facebook and Google aim to become banks…

This is a guest post from consumer credit card comparison site, Choose.