Banks have to be strategic about using social media and ensure that all four phases of the social media loop are in place. They also have to conduct a social media audit, establishing the rate of frequency of posting content and the percentage each of the social media loop quarters holds.
This is according to Dr Nikolaus Eberl, CEO and founder of the Disruptive Innovation Centre, who explains that the four phases of the social media loop are social listening, social influencing, social networking and social selling.
Social listening, he explains, is monitoring and responding to customer service and reputation management issues on social media, while social influencing consists of establishing authority on the social Web, often through the distribution and sharing of valuable content.
"Thirdly, social networking is about finding and associating with authoritative and influential individuals and brands on the social Web.
"Social selling is of vital importance in generating leads and sales from existing customers and prospects on the social Web, he reveals.
He points out that banks need to be clear about how to use social media to drive revenue and reduce costs, rather than just wasting time on interacting on various platforms without a strategic intent to grow the business.
"Banks have to use all four social media engagement levers, unfortunately, most try to shortcut the social media loop and jump straight to the social selling quadrant without spending time on building relationships through social listening, networking and influencing.
"This is possibly the biggest mistake banks make on the social Web and the primary reason why so many banks complain about the lack of return on investment on social media," says Eberl.
Philip Cohen, general manager, Digital Marketing at Absa, says banks can source rich customer feedback from their social platforms, including recurring customer service issues, customer sentiment, customer conversations, needs and wants, customer responses to media reports and market fluctuations.
"As a bank, we use multiple social media mechanisms to amplify our content and stimulate engagement, including compelling headlines and photos, infographics, polls, gamification and new technologies such as periscope and advertising units.
"To effectively communicate and engage customers through social media platforms you must know who they are and what they need from you, he explains.
Cohen adds after getting an understanding of what your clients need, the next step is to create relevant, compelling and engaging content.
"At Absa, we aim to add value with every one of our posts and to make it sharable. The 'sharability' of content more often than not determines the reach and engagement that posts achieve.
"Companies that value customer feedback on social media are able to use this information to refine their product and service offerings," he adds.
As opposed to simply having customer service-related discussions on Twitter and Facebook, Cohen says it's important for banks to use social media to focus on their role as a publisher of relevant, engaging and valuable content that enables customers to make the most of their money and realise their aspirations.
Examples that illustrate the effective use of social media initiatives abound from highly successful global concepts, to crowdsourcing a new chip flavour, and to turning a pizza franchise's fortunes around - from the worst to one of the best in the industry, notes Cohen.
"The opportunities and benefits of social media have no bounds. If your concept is built on sound customer insights and benefits, you will most likely succeed," he continues.
Eberl says there are two primary types of engagement channels on the social Web, namely the seeker channels and the engagement channels.
He explains that users of seeker channels use the social channel to seek specific content, and to consume content on the social channel. These channels are best for social selling and social influencing, for example Youtube and Pinterest.
"The engagement channels are used to engage with others and share short form content that can often times link to longer form content, examples of these are Twitter, Facebook, LinkedIn - these channels are best for social listening, social influencing and social networking," he explains.
He notes the biggest challenge hindering South African businesses from hopping onto the social media bandwagon is the fear of doing the wrong thing and getting pilloried in the court of public opinion.
"However, doing nothing and stopping their employees from engaging on social media, is the single biggest reputation risk South African brands are facing, they need to make a deliberate decision to spend the time and resources required to educate their workforce on how to use social media correctly," concludes Eberl.
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