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Bank Whitepaper

Joshua Waldman
Joshua Waldman

This document proposes a social media strategy for MBank. It discusses the business benefits of social media marketing, including improved customer service, reduced costs, increased brand awareness and loyalty. There are three focuses of a social media campaign: amplification to manage brand perception, listening to understand customer needs, and interaction to build human connections. The proposal recommends using Facebook, Twitter and LinkedIn to target specific demographics and provide customer service at low cost. It also outlines how to measure return on investment through increased website traffic and engagement. The banking industry has started adopting social media successfully despite regulatory challenges.

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A CASE FOR SOCIAL MEDIA AT BANKS Prepared for: MBank Prepared by: Career Enlightenment LLC Date: Tuesday, April 20, 2010 Proposal Revision #: 1
MBank Internet Marketing Consulting Proposal 2 Overview Why Social Media Strategy Social media marketing offers companies expanded and low cost marketing channels where messaging can be highly targeted and bi-directional. Where traditional marketing relies on interrupting an unqualified population though print of other medium, social media asks for interaction from a focused and qualified demographic. According to a recent study called, The Feed Report, published every year by The Razor Group: 65% of consumers have had a digital experience change their opinion about a brand 97% of consumers say their digital experience influenced whether or not they eventually purchased a product or service from that brand The business benefits of Social Media Marketing include Improved customer service Reduced costs associated with customer service Increased brand awareness and ultimately brand equity Increased customer loyalty Reduced Marketing costs, with improved demographic targeting Low cost, if not free, new product or service development crowd-sourcing Through derivative, higher revenue and higher profits There are essentially three focuses of a social media campaign 1. Amplification 2. Listening 3. Interacting Amplification Your company has a brand. And according to a Nielson study in 2009, 70% of people look at other peoples reviews of your product or service before making a decision. Negative sentiment or positive sentiment online seems to have very high impact on the purchasing decisions of the consumer. A good social media campaign will strive to manage negative reviews while providing value and other reasons for positive feelings about the brand. If online brand attitude is not managed by the company, then someone else is determining it.
MBank Internet Marketing Consulting Proposal 3 Listening Social media demands that the traditional sales cycle become reversed. Where companies used to sell, they are now asked to listen. Where companies used to react to complaints, they are now asked to interact, in dialogue, with a community of users. Customers will not listen to companies who do not listen to their needs. The chart below illustrates this reversal. During a Greenpeace campaign geared at preventing whaling in the Sea of Japan, several whales were tagged with GPS devices. Each tagged whale was given a name. Most of the names were quite wonderful: Fecity, Serendipityand then there was Mr. Splashy Pants. Greenpeace wanted to choose one of these whales for an official maskot of this campain. So they put it to vote on social media. Mr. Splashy pants won the vote, but Greenpeace didnt want a maskot called Mr. Splashy Pants and rejected the vote. The outcry online was very heavy handed. So after several bouts with public opinion, Greapeace let go or control and really listened. Their campain was a huge success. A good social media campain includes active listening to really understand the needs of the customer. Interaction When a customer tweeted that they were stuck on the tarmac for four hours on their Continental flight to Chicago, Southwest airlines told them, on Twitter, that a free ticket was waiting for them at their gate, if they could get to it. For the price of a free ticket, Southwest not only earned a new lifelong customer, but showed the Twitter community that they were listening and that there was a human behind that interaction. In general, a feeling of animosity to big brands that dont see their customers as human pervades the internet. A great deal of loyalty and social equity can be earned just by having human interactions. And though these interactions might not lead directly to a sale, they certainly lead to precursors to sale, such as more website visits, questions answered, and social buzz. An ROI can be correlated with many such campaigns.
MBank Internet Marketing Consulting Proposal 4 The Big Three Most businesses have very little risk in using Facebook, Twitter and LinkedIn for their marketing. These medium forms the foundation of any social media campaign and when you work with me, I begin setting up and optimizing these tools immediately. Facebook Facebook is by far the highest leverage tool for consumer-based influence. With more than 400,000,000 registered users, and the average amount of time on the site clocked at about 50 minutes, businesses will not find a better community to target. Facebook advertisement, for example, gives businesses 36 data points so that their messages can be targeted to very specific demographics at very low cost. The following Google-Trends chart shows site/search traffic volume over the last four and a half years. Facebook is clearly on an upward trend and exceeds high volume words such as the and porn (understanding that until recently, pornography was the largest source of internet traffic). Twitter Despite a popular opinion, Twitter is not just for young people bored at work. In fact, HP boasts about making over $6 million just from Twitter. The following chart shows that the median age for Twitter is 18-34, white females with no kids. Though, from my own experience, people under the age of 25 do not really use Twitter as much as people between 25-34 years old. Yes, I have even heard a 21 year old tell me that Twitter is for old people. Go figure.
MBank Internet Marketing Consulting Proposal 5 During an engagement with me, I leverage several powerful tools to create large and focused Twitter audiences for your organization. I will help your communications team develop an editorial calendar and schedule broadcasts, as well as train your team on how to interact with others on Twitter. The following chart show the average growth trend that I will be able to provide for you during a typical 3 month engagement. LinkedIn Over 50 million people use LinkedIn for professional networking. Companies use it for talent acquisition and job postings, as well as for collecting poll results. Individuals use it for networking, informational interviews as well as for making B2B purchase decisions. Having a strong LinkedIn presence can help reinforce a businesss professional image, and by having the executives listed, adds a human element. Finding an ROI According to marketing strategist Oliver Blanchard, social media presents a very complex path to ROI. Where in traditional marketing, tracking efficacy of each campaign is fairly straightforward, the relationship focus of social media can be more round-about. But it is not impossible. Oliver
MBank Internet Marketing Consulting Proposal 6 presents several steps in determining ROI. The crux of his argument lies in statistical correlation. If an organization can measure in increase in the precursors to sale, such as website visits, interactions, impressions, views etc. then increases in revenue and profit may be effected indirectly. The following illustrates the point, showing that slopes with drastic increase after a social media launch are labeled impacted. Beyond theory, just look at some other ROI trends reported by large companies (from Social Media in the Banking Industry): Online community users remain customers 50% longer than non-community users. (AT&T, 2002) 43% of support forums visits are in lieu of opening up a support case. (Cisco, 2004) Community users spend 54% more than non-community users. (EBay, 2006) In customer support, live interaction costs 87% more per transaction on average than online forums and other Web self-service options. (ASP, 2002) Community users visit nine times more often than non-community users. (McKInsey, 2000) Community users have four times as many page views as non-community users. (McKinsey, 2000) 56% percent of online community members log in once a day or more. (Annenberg, 2007) Customers report good experiences in forums more than twice as often as they do via calls or mail. (Jupiter, 2006) Banking Industry and Social Media Despite what must seem to be a regulatory nightmare, many banks are adopting social media marketing. According to Jeremiah Owyang (one of the greatest Social Media thought leaders of our time) there are 19 major financial institutions currently leveraging social media, http://www.web- strategist.com/blog/2008/06/23/ongoing-list-of-social-media-in-the-financial-industry/ For example, here is a screenshot of Bank of America using Twitter to handle customer service issues.
MBank Internet Marketing Consulting Proposal 7 Here is a screenshot of 1st Mariner Bankss Facebook Fanpage: According to, The Community Bankers Guide to Social Media, Social networking Web sites allow banks to accomplish one or more of the following objectives: Improve customer understanding of products and services. Promote issues of social concern (e.g., mortgage defaults, green initiatives, etc.). Promote products and services. Facilitate sharing of knowledge between bank employees and consumers. Increase brand awareness. Because of MBanks focus on Community Banking, setting up and maintaining community based web services will be an important part of the companys strategy. There are many of examples of other banks from which to draw significantly diminishing much of the business risks. And with proper policies in place, the rewards for modernizing customer outreach far outweigh and of the drawbacks.
MBank Internet Marketing Consulting Proposal 8 In 2006, Wellsfargo started the first Bank Blog, and has grown their web services to include online games that teach children financial literacy to Twitter based customer service. Hundred of Wellsfargo employees use blogs to brainstorm and develop new services and ideas as well as interact with customers. Steve Ellis, EVP of Wells Fargos wholesale solutions group said, A blog is informal--a great way to get away from the corporate thing and let people inside our heads.
MBank Internet Marketing Consulting Proposal 9 Appendix A: Generic Metrics per Channel Paid Traffic Benchmark Click through rate 2% Conversion rate 1% ROI Banner Ads Benchmark Click through rate 0.50% Conversion rate 2% ROI SEO Benchmark Google Page Rank 5 SERP Rank 1 to 3 Quality of Incoming Links # Incoming Links Unique visitors Bounce rate Conversions Brand:non-brand What keywords are driving traffic Main traffic sources Pages Indexed Keyword density Social Media Benchmark # positive mentions Customer involvement Unsolicited Testimonials Company Feedback 5% # of retweets # of blog comments # twitter fans 1,000 Benchmark Video
MBank Internet Marketing Consulting Proposal 10 Marketing Views iPhone Apps Benchmark Downloads Email Marketing Benchmark Open Rate 24% Click rate 10% Conversion Rate 2.50%

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Bank Whitepaper

  • 1. A CASE FOR SOCIAL MEDIA AT BANKS Prepared for: MBank Prepared by: Career Enlightenment LLC Date: Tuesday, April 20, 2010 Proposal Revision #: 1
  • 2. MBank Internet Marketing Consulting Proposal 2 Overview Why Social Media Strategy Social media marketing offers companies expanded and low cost marketing channels where messaging can be highly targeted and bi-directional. Where traditional marketing relies on interrupting an unqualified population though print of other medium, social media asks for interaction from a focused and qualified demographic. According to a recent study called, The Feed Report, published every year by The Razor Group: 65% of consumers have had a digital experience change their opinion about a brand 97% of consumers say their digital experience influenced whether or not they eventually purchased a product or service from that brand The business benefits of Social Media Marketing include Improved customer service Reduced costs associated with customer service Increased brand awareness and ultimately brand equity Increased customer loyalty Reduced Marketing costs, with improved demographic targeting Low cost, if not free, new product or service development crowd-sourcing Through derivative, higher revenue and higher profits There are essentially three focuses of a social media campaign 1. Amplification 2. Listening 3. Interacting Amplification Your company has a brand. And according to a Nielson study in 2009, 70% of people look at other peoples reviews of your product or service before making a decision. Negative sentiment or positive sentiment online seems to have very high impact on the purchasing decisions of the consumer. A good social media campaign will strive to manage negative reviews while providing value and other reasons for positive feelings about the brand. If online brand attitude is not managed by the company, then someone else is determining it.
  • 3. MBank Internet Marketing Consulting Proposal 3 Listening Social media demands that the traditional sales cycle become reversed. Where companies used to sell, they are now asked to listen. Where companies used to react to complaints, they are now asked to interact, in dialogue, with a community of users. Customers will not listen to companies who do not listen to their needs. The chart below illustrates this reversal. During a Greenpeace campaign geared at preventing whaling in the Sea of Japan, several whales were tagged with GPS devices. Each tagged whale was given a name. Most of the names were quite wonderful: Fecity, Serendipityand then there was Mr. Splashy Pants. Greenpeace wanted to choose one of these whales for an official maskot of this campain. So they put it to vote on social media. Mr. Splashy pants won the vote, but Greenpeace didnt want a maskot called Mr. Splashy Pants and rejected the vote. The outcry online was very heavy handed. So after several bouts with public opinion, Greapeace let go or control and really listened. Their campain was a huge success. A good social media campain includes active listening to really understand the needs of the customer. Interaction When a customer tweeted that they were stuck on the tarmac for four hours on their Continental flight to Chicago, Southwest airlines told them, on Twitter, that a free ticket was waiting for them at their gate, if they could get to it. For the price of a free ticket, Southwest not only earned a new lifelong customer, but showed the Twitter community that they were listening and that there was a human behind that interaction. In general, a feeling of animosity to big brands that dont see their customers as human pervades the internet. A great deal of loyalty and social equity can be earned just by having human interactions. And though these interactions might not lead directly to a sale, they certainly lead to precursors to sale, such as more website visits, questions answered, and social buzz. An ROI can be correlated with many such campaigns.
  • 4. MBank Internet Marketing Consulting Proposal 4 The Big Three Most businesses have very little risk in using Facebook, Twitter and LinkedIn for their marketing. These medium forms the foundation of any social media campaign and when you work with me, I begin setting up and optimizing these tools immediately. Facebook Facebook is by far the highest leverage tool for consumer-based influence. With more than 400,000,000 registered users, and the average amount of time on the site clocked at about 50 minutes, businesses will not find a better community to target. Facebook advertisement, for example, gives businesses 36 data points so that their messages can be targeted to very specific demographics at very low cost. The following Google-Trends chart shows site/search traffic volume over the last four and a half years. Facebook is clearly on an upward trend and exceeds high volume words such as the and porn (understanding that until recently, pornography was the largest source of internet traffic). Twitter Despite a popular opinion, Twitter is not just for young people bored at work. In fact, HP boasts about making over $6 million just from Twitter. The following chart shows that the median age for Twitter is 18-34, white females with no kids. Though, from my own experience, people under the age of 25 do not really use Twitter as much as people between 25-34 years old. Yes, I have even heard a 21 year old tell me that Twitter is for old people. Go figure.
  • 5. MBank Internet Marketing Consulting Proposal 5 During an engagement with me, I leverage several powerful tools to create large and focused Twitter audiences for your organization. I will help your communications team develop an editorial calendar and schedule broadcasts, as well as train your team on how to interact with others on Twitter. The following chart show the average growth trend that I will be able to provide for you during a typical 3 month engagement. LinkedIn Over 50 million people use LinkedIn for professional networking. Companies use it for talent acquisition and job postings, as well as for collecting poll results. Individuals use it for networking, informational interviews as well as for making B2B purchase decisions. Having a strong LinkedIn presence can help reinforce a businesss professional image, and by having the executives listed, adds a human element. Finding an ROI According to marketing strategist Oliver Blanchard, social media presents a very complex path to ROI. Where in traditional marketing, tracking efficacy of each campaign is fairly straightforward, the relationship focus of social media can be more round-about. But it is not impossible. Oliver
  • 6. MBank Internet Marketing Consulting Proposal 6 presents several steps in determining ROI. The crux of his argument lies in statistical correlation. If an organization can measure in increase in the precursors to sale, such as website visits, interactions, impressions, views etc. then increases in revenue and profit may be effected indirectly. The following illustrates the point, showing that slopes with drastic increase after a social media launch are labeled impacted. Beyond theory, just look at some other ROI trends reported by large companies (from Social Media in the Banking Industry): Online community users remain customers 50% longer than non-community users. (AT&T, 2002) 43% of support forums visits are in lieu of opening up a support case. (Cisco, 2004) Community users spend 54% more than non-community users. (EBay, 2006) In customer support, live interaction costs 87% more per transaction on average than online forums and other Web self-service options. (ASP, 2002) Community users visit nine times more often than non-community users. (McKInsey, 2000) Community users have four times as many page views as non-community users. (McKinsey, 2000) 56% percent of online community members log in once a day or more. (Annenberg, 2007) Customers report good experiences in forums more than twice as often as they do via calls or mail. (Jupiter, 2006) Banking Industry and Social Media Despite what must seem to be a regulatory nightmare, many banks are adopting social media marketing. According to Jeremiah Owyang (one of the greatest Social Media thought leaders of our time) there are 19 major financial institutions currently leveraging social media, http://www.web- strategist.com/blog/2008/06/23/ongoing-list-of-social-media-in-the-financial-industry/ For example, here is a screenshot of Bank of America using Twitter to handle customer service issues.
  • 7. MBank Internet Marketing Consulting Proposal 7 Here is a screenshot of 1st Mariner Bankss Facebook Fanpage: According to, The Community Bankers Guide to Social Media, Social networking Web sites allow banks to accomplish one or more of the following objectives: Improve customer understanding of products and services. Promote issues of social concern (e.g., mortgage defaults, green initiatives, etc.). Promote products and services. Facilitate sharing of knowledge between bank employees and consumers. Increase brand awareness. Because of MBanks focus on Community Banking, setting up and maintaining community based web services will be an important part of the companys strategy. There are many of examples of other banks from which to draw significantly diminishing much of the business risks. And with proper policies in place, the rewards for modernizing customer outreach far outweigh and of the drawbacks.
  • 8. MBank Internet Marketing Consulting Proposal 8 In 2006, Wellsfargo started the first Bank Blog, and has grown their web services to include online games that teach children financial literacy to Twitter based customer service. Hundred of Wellsfargo employees use blogs to brainstorm and develop new services and ideas as well as interact with customers. Steve Ellis, EVP of Wells Fargos wholesale solutions group said, A blog is informal--a great way to get away from the corporate thing and let people inside our heads.
  • 9. MBank Internet Marketing Consulting Proposal 9 Appendix A: Generic Metrics per Channel Paid Traffic Benchmark Click through rate 2% Conversion rate 1% ROI Banner Ads Benchmark Click through rate 0.50% Conversion rate 2% ROI SEO Benchmark Google Page Rank 5 SERP Rank 1 to 3 Quality of Incoming Links # Incoming Links Unique visitors Bounce rate Conversions Brand:non-brand What keywords are driving traffic Main traffic sources Pages Indexed Keyword density Social Media Benchmark # positive mentions Customer involvement Unsolicited Testimonials Company Feedback 5% # of retweets # of blog comments # twitter fans 1,000 Benchmark Video
  • 10. MBank Internet Marketing Consulting Proposal 10 Marketing Views iPhone Apps Benchmark Downloads Email Marketing Benchmark Open Rate 24% Click rate 10% Conversion Rate 2.50%