A recent report entitled Social CRM in German Retail Banks made the case for banks adopting social communications, saying: “banks that have an effective social-media strategy have a huge advantage in being able to develop a closer relationship with their customers”. They went on to map the performance of retail banks in Germany according to their social media engagement with customers (above).

Yet the same report went on to say ““The social-media platforms have also provided banks with a new channel of communication and a CRM tool that is being effectively used by only a few banks. While some industries, such as the lifestyle industry, telecommunications or the automotive industry, have realised the importance of social media, most banks are still struggling to get their social-media strategy right.”

In the emerging world of social CRM (sCRM) banks are faced with a raft of issues that go way beyond the technical, financial, logistical and cultural challenges of implementing “social business”. There are laws – both international and national – the prevent them from matching up customer data with social media records. There are industry regulations that prevent them from revealing that customers are in fact customers, or giving financial advice via a public medium. And, of course, there are the T&Cs of the social networks themselves, which restrict how (and where) businesses can communicate with their customers. They also need to contend with the rules of fairness, openness and courtesy that we all expect from them.

Many of these restrictions apply to banks everywhere – and, as a result, banks have been hugely reticent in exploring social media – hence my recent delight at discovering that several large banks in Asia are adopting Facebook and Twitter as primary communication channels. Yet there are some promising European examples too…

• Caja Navarra in Spain puts the customer at the centre of its operations, using Twitter, Skype, Facebook and YouTube to provide customer support and build communities around social causes.
• Jyske Bank in Denmark is has a social TV channel through which it provides interactive Q&A sessions with financial experts. It has also published iPhone and iPad apps to enable its customers to communicate more easily on the move.

It’s clear that some banks “get” social. It’s also true that the challenges it raises have dramatically slowed the adoption of social CRM in other industries too. Faced with myriad regulations, accountants, for example, have tended to shy away from social communications completely. The same could be said of utilities, though again, there are some pioneers emerging, such as the UK’s British Gas.

I’m going to be in Frankfurt next month for the latest of our Social CRM 2012 conferences – and given that it’s the centre of banking in Germany – I’m hoping we’ll provide some new insights for our financial friends. In addition to case studies of Telekom Deutschland, Deutsche Bahn and Playmobil, we have a session on “How Social Apps Innovate CRM in Banking and Financial Services” featuring an analysis of how Sparda International implemented a suite of innovative social CRM tools to stimulate creativity, boost efficiency, enhance information-sharing and improve collaboration at the bank.

To kick start our promotions around this event we’ve created a version of our hugely popular Traditional CRM vs Social CRM infographic in German (below). Please feel free to share this.

For anyone who can’t make Social CRM Frankfurt, the conference will be in Brussels on 26th September too.

Why do customers ‘like’ a brand on Facebook? And how do brands respond? Using recent research by the CMO Council, we set out to produce this infographic as a thought-provoking reminder as to why brands need to engage with their fans on social media.

The top motivation for ‘liking’ a brand’s Facebook page is because you are a loyal customer, but brands are failing to engage these customers and are missing the opportunity to deepen their relationship. Only 1.3% of ‘fans’ actually engage with the brands they ‘like’.

The reason this is so low? Customers expect something in return for their click and, in general, they aren’t getting it. Over two-thirds say that they expect to be eligible for exclusive offers via social media, but less than a quarter of brands actually offer this. Brands need to give something back, whether it’s exclusive offers, content, prize draws or otherwise.

Perhaps the biggest mistake brands tend to make is overloading their ‘fans’ with marketing. Excessive posting and irrelevant content are the main reasons why customers click the ‘unlike’ button.

We’re going to be digging into this more in two free webinars we’re hosting over the coming month. If you’d like to know more about the science and emotion of social media, join us for these:

• May 9^th – The Science of Social: How to Analyse & Optimise Your Campaigns to Increase ROI.
• June 20^th – The Emotion of Social: How to Identify & Reward True Advocates

Register for free

What’s the difference between traditional CRM and social CRM? This is often the first question in the long and tricky process of “socialization” that many large organisations are currently experiencing.

Having listened to experts from American Airlines, IBM, VistaPrint, Peugeot, Everything Everywhere, British Gas, Expedia, Spotify and many more brands explaining their approaches to social CRM at recent Our Social Times conferences – I think we’ve got a pretty clear vision of how organisations should approach social customer engagement and the management, tools and processes they need to set in place around it.

With this in mind – and prior to our upcoming social CRM conferences in Frankfurt, Brussels and Paris – we thought we’d publish an infographic to set out the key points of differentiation between traditional and social CRM.  We hope it’s useful.