Australians are increasingly turning to social media for financial advice and have no qualms sharing their bad experiences with online friends – particularly when it comes to poor service from banks and super funds.
Respondents to a recently released Core Data Consulting’s Social Media: Engaging Financial Services Consumers Survey, were largely negative about whether financial services companies could effectively position themselves to offer trustworthy and useful information through social media platforms.
Generally, the research concluded that most people are unlikely to use online communities for detailed information on superannuation, mortgages, term deposits, financial advice or insurance.
“The financial services industry still has a long way to go in terms of being used for online consultation during the decision-making process,” the survey states.
However, while many Australians are inherently suspicious of advertising through social media and do not feel this is the correct platform to discuss their finances, respondents who are more receptive to this marketing avenue say it provides an easier way to access information and is now a socially acceptable medium for interaction.
“Because social media is just another platform for marketers to reach out to consumers,” said one respondent. “It’s a changing landscape and marketers are realising that people’s habits have changed with regards to media consumption, and it would make a lot of sense to start marketing where the eyeballs are going.”
The figures in a changing landscape
Banks were perceived as the best placed to position themselves via social media but only three in 10 respondents (30.7 per cent) felt it could be done.
A quarter of respondents (24.1 per cent) felt the same about superannuation, while only 20.3 per cent felt financial advice brands could do this, and even fewer (18.4 per cent) felt mortgage brokers could effectively position themselves in this way.
Of the banks, the largest number of respondents thought that the Commonwealth Bank of Australia was best positioned to offer information on social media platforms (21.5 per cent) – more than twice the number that voted for any of the Big Four competitors.
Of those who believed there were superannuation brands that are well placed to offer information through social media, 13.8 per cent selected industry super funds.
The second most popular response was “all super funds” (12.2 per cent), and then AMP (10.5 per cent).
AMP also headed the list for financial advice, with 10.8 per cent considering it best placed to provide information on social media platforms, followed by “all/any adviser” (10.1 per cent) and major institutions (8.1 per cent).
The FPA example
While the role of industry associations in bridging the gap between online consumers and financial services, marketing was not directly addressed by the survey, the Financial Planning Association (FPA) is having some success using social media platforms to remain in contact with its members.
The association recently notched up 1000 FPA members who have joined its LinkedIn members’ forum, launched in November last year.
On average, 40 FPA members join the forum each week.
While the LinkedIn forum enables FPA members to discuss and debate issues that are important to them, Twitter provides an efficient channel to keep members updated on news and developments.
“Social media is important to make sure that we are keeping in touch with our members across a range of communication channels and enabling them to engage with us in different ways of their choice,” said Mark Rantall, chief executive officer of the FPA.
“Communicating with our members is especially crucial in the current climate, with so much industry reform and business change taking place.”
Financial Planning Association chief marketing officer, Lindy Jones, believes the organisation’s Twitter and LinkedIn channels have proved extremely successful in breaking new ground to communicate with its members.
“The LinkedIn forum is only open to FPA members and provides a means for them to discuss views and exchange opinions with each other on the issues that affect them as professionals,” she said.
“The subject matter, collegiate tone and calibre of insight distinguish this forum from any other online media for financial planners.
“We’ve also found the LinkedIn forum has been very effective in testing the temperature of our membership on a range of issues, as well as gathering member views to develop our government policy submissions.
“For instance, the federal budget submission in January prompted a debate in the forum about the hot topic of the tax deductibility of advice fees.
“The forum’s views were taken into account when we developed the submission.”
Hi
Interesting article. I believe Social Media is still developing (but very quickly) and just about anyone in business will benefit from it. The comments from Mark Rantall of the FPA are the most telling, highlighting that it an opportunity to communicate and engage with its members. The engagement is the difference, just using social media to pass on information is not so beneficial.
Not so long ago the web and email were new innovations and companies were hesitant to get on board. They are now mainstream communication channels. All Social Media does it take those channels to a new level offering greater engagement with clients/members/prospects etc
One big difference is that social media is very cheap, just about anyone can get up and running for next to nothing and create opportunities for themselves that simply did not exist just a few years ago.
Cheers