Is social media a new frontier for financial institutions?

Any discussion on corporate digital media trends inevitably touches on the value of social networks for business interactions, though it’s a frontier that many bank executives may consider insurmountable. Banks are not often known for being accessible, much less socially active. When it comes to seeking support, more consumers are familiar with calling their bank – and waiting for minutes on hold – rather than tweeting it and expecting an immediate response.

However, ignoring social media outright could represent a significant missed opportunity, some experts say, particularly in light of the fact that many more banks are looking for new ways to connect with consumers. Customer engagement is a multilayered effort that requires access to comprehensive consumer data, sophisticated portfolio management software, and, at times, a little social savvy.

In October, the Wall Street Journal published the account of one Citibank customer who tweeted her frustrations with the long hold times on that company’s customer service line. She received a reply via Twitter and a request for her phone number nearly instantaneously. Minutes later, she was on the phone with a customer service representative.

Social media isn’t a major part of Citibank’s customer service model, but it is one service that could enable the company to make new, stronger connections with customers that feel better served.

Such initiatives open the door to new opportunities for banks, which could include improvements in customer service, portfolio building and marketing. However, to guide such strategies, and to prevent misuse, financial institutions will need reliable portfolio data.

With customer management software that offers insight into the history and needs of a client population, banks will be in a better position to implement new customer engagement strategies.

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