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Followers and friends prove vital source of fresh prospects
Published on Friday, 18 Feb 2011
Photo: iStock
Rosetta Fong, CEO and executive director, Convoy Financial Services Holdings

The power of social networking is not in doubt. From the online campaign that helped bring Barack Obama into office in 2008 to the recent Facebook-led revolt that toppled Egyptian president Hosni Mubarak, social media has proven itself a formidable political tool. But can its power make an impact in the banking and financial services sector?

Convoy Financial Services Holdings has been testing the waters on that front since 2009. CEO and executive director Rosetta Fong says the medium offers wide marketing possibilities but also has potential downsides, such as negative publicity.

"My view is [that] social networking platforms [are] one of the channels to reach potential customers, but will only be effective if it is not seen as an advertisement," she says.

Convoy is already using social networking in its operations, primarily to allow its customers to get quick responses to inquiries or requests for information from the company.

It's also a useful medium for the company to get its market views across to customers. It's a method of customer service the company intends to expand, Fong explains, but it's not without risks.

"Ideally, we would like to use the social networking platform to fill the service gap, which means to provide a more timely response to people about our views or actions," she says.

The downside is that the nature of social media relies on multiple sources of information, including customer feedback and product comparisons. Thus, companies have limited means of controlling whether comments about them are positive or negative.

"A successful viral marketing [platform] is built on real user experiences, which is a double-edged sword," Fong says. "You have to build a `real' community in order to achieve success, which means you have to accept negative, as well as positive comments about your services, and you need to show people how you handle negative feedback."

Another company to have jumped on the social networking bandwagon is Bank of America, which launched a Twitter site in 2009, according to a New York Times report. The bank said it would use the site to listen and respond to customers. "We are entering new territory. A place not familiar to many in financial services - but a place with tremendous opportunity," it said.

Clients benefit from an alternative to having to call the bank and, from having an identifiable contact, to make the experience more personal.

Communication is necessarily succinct - Twitter limits users to 140 characters per message - but bank employees manning the site often offer to call customers to discuss questions or problems in more detail.

It is difficult for companies to assess how successful their social networking campaigns are in terms of sales. Fong believes that while many users of sites, such as Facebook, exchange product information and check other users' comments before purchasing, such exchanges may not result in anything more than online chat, with a neutral impact on sales.

"I seldom see anyone buy anything relying just on Facebook pages, but you can see a lot of searches for real user comments before buying," she says.

Before launching a social networking presence, companies need to ensure they can provide the high standard of online service that internet users have come to expect.

"People using social networking platforms expect interactions, fast responses and transparency," Fong says. "The turn-around time and data accuracy [requirements] are much more stringent."

Another consideration is finding the right people to moderate the content and manage the site. There are career opportunities for Web designers, programmers and researchers for content development.

Convoy is looking for a senior officer to act as a moderator or co-ordinator for the company's social media development. Someone with financial reporting experience could be suitable, Fong adds.

Those with most expertise in handling social networking tend, such as the users, to be in the 25-35 age group, although this is expanding to the over-40s, Fong says.

This is one job where hands-on experience counts more than qualifications for candidates aspiring to work in the field.

Content providers need to ensure information provided in social networking platforms meets the same high standards as those practised in the rest of the company.

However, to draw users, the information also needs to be new, in order to avoid information overload, and well-presented.

"To some extent, the content provided by us reflects the professionalism we have. It is very important to make sure the information is accurate, professional and updated," Fong says.