Why banks need blogs to engage their customers
Financial institutions need to engage in corporate blogging efforts without delay as a major brand-building and customer connection exercise, according to a research report from Javelin Strategy & Research.
According to the study of over 3,500 consumers, one in five reads blogs. This contrasts sharply with the fact that blogs are offered by less than 1% of financial institutions worldwide.
Brand damage control As a result, the company warns, banks are largely losing control of discussion about their brands in the 'blogosphere'. But bankers may also find that none of their long-standing face-to-face customer interaction rules apply to blogging - a technology that can provide relatively low-cost marketing benefits that few other channels can produce.
James Van Dyke, president for Javelin, explained: "Blogs are quickly becoming vital to many consumers that seek advice or opinions on a variety of topics with a more informal tone. Financial Institutions need to realise that brand management, customer-centricity, and even customer loyalty can be strengthened through a blog at relatively little cost, but only if the new rules are understood by established bankers."
Key findings According to study author and research analyst Jean Garascia, blogging only poses a risk to financial services firms that ignore it while the phenomenon positively impacts the brands of competitors. Garascia said: "Successful blog sites require preparation and research of both consumers and peers, and can pay big dividends through higher customer interaction levels."
The report's main findings included that:
- 34% of tech-wise consumers (those who possess or use multiple technology products) read blogs.
- 20% of all online US consumers read blogs.
- Social media is becoming ever more pervasive, impacting the financial lives of consumers, and blogging is an extension of this phenomenon.
- Financial institutions can use blogs to proactively address consumer concerns.
- A blog represents a non-intrusive way to reach consumers and develop the brand while also providing more effective customer service.