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How the Banking Sector Can Benefit From Social Media

By CIOReview | Friday, August 28, 2020

Consumers have become more sociable than ever. As a result, financial institutions like banks where profitability and sustainability are long term goals now involve homogeneous groups of consumers in an online dialogue that helps build relationships through participation and reciprocity

Fremont, CA: The financial sector has always been open to the adoption of new technology. In today’s data-driven world, disruptive technologies dominate how business is conducted, and industries have been forced to accept these changes or perish. Technology is no longer a tool for enhancing business operations, but in fact, essential for the survival of the business. Social media has become increasingly trending today. The volume of bankers on social media is too small to overlook. Social media has turned into an exciting marketing platform for the banking sector. Here are some of the functional benefits offered by social media to the banking sector.

Forming an Online Community for Consumer Engagement

Advertising and promotions need to be well thought off by banks due to the concerns about regulatory compliance. Social media offers banks a platform to enhance their reach and spread their wings to connect and communicate with many people. The banking sector has traditionally been associated with money, finance, and structuring growth and safety. Consumers have become more sociable than ever. As a result, financial institutions like banks where profitability and sustainability are long term goals now involve homogeneous groups of consumers in an online dialogue that helps build relationships through participation and reciprocity.

Relationship Banking

Banks can use social media to form financial bonds, relational bonds, and structural bonds with customers. Financial bonds intrinsically have a monetary connotation. It involves some transactions where the parties make economic gains, like customers feeling they are benefiting financially from a relationship with a bank. When a customer makes a fixed deposit and is happy at the interest they receive, or takes a loan and feels they have struck a good deal, it means they have entered into a financial relationship with the bank. When the bank provides higher returns on investment for long term deposits, the customer makes monetary gains from the financial bond. Social media campaigns highlighting the benefits of a financial relationship with banks can contribute significantly to the growth of these financial relations.

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