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Banking is changing. Formerly faceless institutions are developing online personalities through social media engagement, and experimenting with new ways of creating and maintaining customer relationships. But away from the customer service revolution, other seismic shifts are occurring. Financial institutions process millions of transactions each day, every one its own set of data points, the whole forming a vast trove of potentially valuable information known as Big Data.
Just think: every transaction tells a story, and every story has a lesson, but how can we extract the stories from the numbers? All four of the major banks in Australia (NAB, CBA, Westpac, and ANZ) are competing to unlock the valuable insights hidden in the Big Data mountain, with CBA taking an early lead thanks to a recent modernization of its IT systems, followed by strategic investments in social media, mobility and analytics.
The results of CBA’s focus on Big Data analysis has led to some startling bottom-line consequences: check fraud is down 50% and internet fraud by a staggering 80%. By reading patterns in the data and creating systems which recognise suspicious transaction patterns, every aspect of the business benefits: customers gain confidence, which is reflected in a healthy brand identity, and less revenue is lost to fraudsters.
With the other three big players forced to play catch-up, the big question is whether CBA can hold on to the top spot. As you can imagine, NBA, Westpac and ANZ are making their own strategic investments, and the next few years look set to be a period of unprecedented competition, and as everyone knows, competition means better products, better service and better business.January 3, 2014
Social Media is the wild frontier of the contemporary business world, a place where huge success and catastrophic failure sit side by side, a shifting landscape which requires constant vigilance and engagement to survive. The key to success lies in understanding your customers’ likes, dislikes, wants, intents and even their innermost feelings, and targeting your social media presence so that it gives people more of what they do want and less of what they don’t.
Luckily, social media users are constantly expressing themselves: on Twitter, FaceBook, LinkedIn and Google+, existing and potential customers are generating a vast trove of valuable marketing data, but how can enterprise make use of this chaotic mass of opinion?
Sentiment Analysis is the collective name given to a variety of techniques all aimed at mining the gold beneath the social media landslide. The most modern and accurate techniques make use of software based on Natural Language Processing (NLP), which assesses the nature of feelings and opinions, even taking into account tone of voice, sarcasm and irony, before organising statments into positive, neutral or negative sentiments.
The resulting data offers businesses of all kinds an incredible resource, and a powerful insight into what customers really think and really want. But how does this knowledge translate into value for your company?
The first benefit is a deeper relationship with your customers. Using Sentiment Analysis, you can create a targeted customer service approach which gives customers exactly the service they want. As well as satisfying your customers and promoting positive word of mouth, this kind of evidence-based business structuring can lead to major efficiency savings, generating material value for your company.
This kind of empathetic customer engagement is of course highly desirable, but what about more concrete, immediate benefits?
One of the most incisive aspects of Sentiment Analysis lies in the potential for gaining commercial intelligence. As well as analysing sentiments about your own company, you can discover what consumers think of your competition, and develop ways to differentiate and improve on rival services, ensuring that when it comes to customer satisfaction, you are always one step ahead. For companies who wish to build or rebuild a brand, sentiment analysis is an indispensable source of inspiration and a fantastic metric of brand success.January 2, 2014
Consumers have changed, and the line between customer and partner has blurred. A decade ago, financial services marketing was an impersonal affair, with faceless institutions throwing huge marketing budgets into largely intuitive strategies. Now, thanks to the advent of social media, financial institutions have the opportunity to really get to know their customers, and to embark on a mutually beneficial relationship.
One of the biggest surprises of the social media revolution is in its demographics: while we might expect social media to be dominated by teenagers, it turns out that some of the most sought-after consumer profiles are also the most active on social media. Mass Affluents (investors with assets of £60,000 to £600,000, excluding the value of their homes) are a highly visible, highly influential presence on multiple platforms. Over 84% of Mass Affluents confirm using social media, with 40% engaging directly with financial companies and 32% using content created by financial companies. In terms of usage by social media channel, about three-quarters are using Facebook, half are using LinkedIn, and roughly one-quarter are on Twitter.
Thanks to the constant feedback of analytic data provided by social media marketing, we now know more about Mass Affluents and their investment habits than ever before, and some of the information may surprise you:
Out of those surveyed, Mass Affluents learned about a financial institution through:
- Ads = 60%
- Content Marketing = 38%
- A friend on a social network = 34%
- Industry expert = 30%
Mass Affluents learned about new financial products through:
- Ads = 55%
- Content Marketing = 34%
- A friend on a social network = 25%
- Industry expert = 28%
As a result, 63% of Mass Affluents have taken some form of action, including opening or closing an account, or by purchasing a new product.
- 44% of Mass Affluent social media users engage with financial companies
- 31% read their content
- 30% follow or like them
- 23% review multimedia content
- 34% of Mass Affluent social media users engage with the content they consume from financial institutions.
However, before you direct your entire social media strategy towards attracting Mass Affluent business, heed these words of caution from Jacqueline Anderson, director of social media and text analytics at J.D. Power and Associates: ‘Companies that are focused only on promoting their brand and deals, or only servicing existing customers, are excluding major groups of their online community, negatively impacting their satisfaction and influencing their future purchasing decision. A one-pronged approach to social is no longer an option.’
What this means in practice is that any good social media strategy needs to maintain existing relationships as well as develop new ones.December 30, 2013
We live in an age of constant technological revolution, where new innovations disrupt established business paradigms and solid ground rarely remains solid for long. This shifting landscape necessitates a fundamental change of strategy in almost every commercial sector, including financial services. Social media is the crucible where new business practice is born, with consumers and companies engaged in a passionate conversation about the future of connected business.
At the core of our age of productive disruption is the connected customer, whose network of influence has the power to influence brand perception. Every interaction with customers now has potential consequences, placing a huge premium on intimate, empathetic customer relations and unimpeachable brand ethics. Financial institutions which fail to properly engage with and monitor this inbound stream of social conversations risk missing out and being left in the dust.
The problem of disruption, like all problems, is actually a solution: properly engaging with social media can deliver real benefits to financial institutions and companies of all types. Australia’s largest bank, NAB, is a fantastic example of how embracing disruptive online technologies can lead to material benefits: by setting up a dedicated social media command centre, every part of NAB has access to consistent intelligence and insight across teams, departments, divisions, and locations.
This allows them to:
- 1. Decrease operational costs via social and community customer service, which can replace impersonal, expensive call centres and postal response teams.
- 2. Grow revenue through lead generation and nurturing existing relationships, which can lead to an increase in ROI over time.
- 3. Be more responsive, innovate faster and differentiate the brand among its competitors, helping to establish a corporate personality.
This third point may not seem as attractive to bottom-line watchers as the first two, but if your business is going to be the disruptor and not the disrupted, your online strategy needs to be responsive enough to turn on a penny: the key to staying ahead in the social media marketplace and surviving the waves of disruption is flexibility.December 27, 2013
Social media is much more than a vehicle for delivering promotions and advertising. For financial services companies, whose profitability depends on maintaining customer relations through changing conditions, social media is an opportunity to create a mutually beneficial relationship with consumers. Correctly implemented, a unified social media strategy can result in a massively improved customer experience, which in turn leads to gains in profit and efficiency for companies.
Availability, accountability and reassurance: the benefits of social media for consumers are clear, but what about the benefits for financial service companies? There are four distinct areas where a well-designed social media strategy can support and enrich your business:
1. Increased Efficiency: Social Media can help banks centralize teams and target marketing spends, helping to make the most of existing resources. Financial institutions can also reduce operational costs by using social networks to crowdsource solutions.
2. Lead Generation: Brands can capture new business leads and revenue opportunities in social media which may not surface through other channels.
3. Innovation: Socially aware banks are already using social media to gain insight into how their customers behave in real-time, through social listening, moderation, and engagement. Companies can then use this data to target new products, services, and support.
4. Improved Brand Perception: Quick responses to customers on social media channels can help banks improve brand perception and drive long-term loyalty. This is an increasingly important consideration as social channels become venues for product discovery and consideration. Using social media strategy to nurture these online relationships can lead to real, offline relationships which in turn lead to greater loyalty, referral, and advocacy.
But what kind of customers are waiting in social media networks? A decade ago, social media was the preserve of teenagers and socialites, but modern social media is a great way to target some of the most desirable demographics: Mass Affluents (current investors with £60,000 – £600,000 in assets, excluding the value of their homes) have been found to be heavily engaged in social media, with over 84% using social media, 40% using social media to engage with financial companies, and 32% actively engaging with content created by financial companies.December 23, 2013