Banks told 'face up to change' for Twitter generation

FINANCIAL organisations are missing out on improving their customer service and building awareness of their brands by neglecting social media, according to a Yorkshire consultancy.

Tim Sinclair, chairman of Leeds-based consultancy Wolfstar, which specialises in social media, said sites such as Twitter have become powerful marketing tools for multi-national companies but banks and building societies are not exploiting the phenomenon.

Earlier this year, a report by market analyst Datamonitor said banks have adopted a "bury-their-heads-in-the-sand" approach to the part social media could play in both keeping and obtaining customers.

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It added that whilst social media can build awareness of brands, its real value comes through other, softer factors which build customer trust and brand loyalty.

Mr Sinclair said: "I feel like a baptist missionary in Africa. Most people do not get social media. They can see what is out there and don't know what to do with it."

One bank which has embraced the concept is Leeds-based First Direct. The bank developed a real-time feedback site called Live last September after the banking crisis prompted the brand to think about how to build a better relationship with its customers.

To date, 40,000 people have visited the site and 3,500 people have commented on First Direct's services.

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A First Direct spokeswoman said: "It is live and unedited and that is a really bold thing for a bank to do. It also enables us to have a conversation with customers and tell them when things are happening."

The site is only the beginning of the bank's social media campaign. Next, it plans to use Twitter as a customer services tool rather than simply a PR tool.

A quick poll of Yorkshire's other banks and building societies found that concern about resources was one of the reasons for not engaging in social media.

Once an organisation starts using online tools to engage with customers, there's an expectation that it will continue that conversation all the time.

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A Yorkshire Bank spokeswoman said: "We haven't engaged fully in social media but we recognise that it's definitely something we need to look at. We don't think it's a passing fad.

"We are exploring how we can be part of it and how we can have the resources to do it."

But Mark Hanson, deputy managing director of Wolfstar, said financial organisations could actually save resources by introducing these online tools.

"Banks and building societies would not have to employ as many people in customer services or in branches if they used social media because it reduces the number of people using other channels"

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Skipton and Yorkshire Building Societies said they were not currently using social media. Nobody at Leeds Building Society was available for comment.

A Skipton Building Society spokeswoman added: "A lot of our engagement with customers tends to be through branches and over the telephone but we are always looking at reviewing the ways we connect with customers and it is on our radar."

Financial Leeds warned that social media might not suit all financial services organisations and that banks and building societies would see how it develops over time.

However, Mr Sinclair insisted as long as it is used in the right way, social media can benefit any organisation.

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"The principles are the same for everyone but the way you do it is different," he said.

"If you believe in PR you have to believe in social media. Things will come and go but social media has fundamentally changed the way we operate."

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