Discuss about the Global Retail Banking Digital Marketing Report.
This research would investigate the role of social media for engaging consumers in the banking sector. A case of HSBC is considered for understanding issues that are causing hindrance to the development of the engagement strategies that are effective for the organization. The research would explore various engagement strategies used by the banking sector to identify best practices that can be used for HSBC to improve its engagement with its customers. This document is the research proposal which suggests use of a mixed methodology involving a secondary case study analysis on engagement strategies, secondary quantitative data analysis of HSBC social media campaign results, and thematic analysis of the interview responses of marketing managers of HSBC.
With drastic changes in social media technologies in the past decades, multiple industries are now adopting the technologies for various purposes including consumer engagement. The use of social media is on rise even in the banking and financial sector. Banks are able to directly interact with their customers and engage them in different ways using social media (Marous, 2014)..
In HSBC, customer satisfaction is seen to be declining in recent past as the organization is unable to fulfil the demands of the technology savvy consumers. The bank is unable to engage consumers over social media sufficiency despite its heavy usage. HSBC has a very low like ratio with only 7-8 posts getting likes between 1000 posts. This suggests that the company is unable to understand consumers sufficiently or are unable to engage them properly over the social media. Thus, there is a need to explore the challenges that the company is facing in the social media space while engaging consumers and identify best practices used by other banks so that the same can be recommended for HSBC so that its social media engagement can be enhanced (Ahluwalia, 2015).
The Aim of this research is to explore how social media is used by Banks for engaging their customers so that an engagement strategy can be formulated for HSBC, UK to improve their engagement with consumers over the social media.
The research objectives include:
The potential outcomes of this research would be:
The output of these outcomes of the research project would be:
Banking is growing in its usage over the digital that includes online banking and mobile banking. There is a trend of increasing use of internet by banking consumers over past decade. Thus, this digital presence of consumers demand banks to use digital media also as a channel for marketing and promotion. Thus, over past few years, banks have taken significant efforts to use digital channels to run their marking campaigns with social media playing a major part which is used for engaging consumers by banking organizations (Desmares & Sharma, 2013).
Consumer engagement involves interactions between a brand and its consumers who resposd to the marketing efforts taken by the companies in different ways such as by participating in activities, providing feedback through answering questions, spreading word of mouth through referrals and recommendations or participate in community activities.
Consumer engagement can be viewed considering two dimensions that include development of the relevant offer or message that can add value to customers and sharing of these offers or messages using a right mix of the social media channels in a convenient, consistent and contextually appropriate manner.
Customer engagement is an important goal for organizations as it can bring customer satisfaction and loyalty in them. An emotional attachment could be achieved with this engagement in consumers. When considering the use of social media by banks, most often organizations use social media to allow customers to share their personal information such that in return financial advice is given to them. Such engagement builds trust in consumers and thus, helps in forming relationships between customers and the bank. Engaging with consumers this way is only one consumer engagement strategy out of many.
Choice of strategy can also be dependent on the social media channels and their popularity. For instance, YouTube is a very popular channel through which companies can post their advertisements in the social videos as they have high social engagement and there the chances of a consumer or customer clicking the ad posted in the social video can bring in engagement. Snapchat is another social media platform that has become very popular over the past few years. The platform can be used for providing real time updates about what is happening in the bank or the industry to consumers. Snapchat has over 10 billion video views daily that include views from consumers in the age range of 18 to 35 who use live stories and geofilters or smart lenses to engage with brands. For instance, March Madness Live Story that ran around NCAA basketball tournament was used by an insurance company to create a buzz on social media for consumer engagement.
To build a sound engagement strategy for customers, it is essential that the whole customer life cycle and customer touchpoints during the same are analyzed to understand how they can engage with the brand at different levels and times. More personalized the interaction is between the bank and the customers, more influential would be the engagement strategy as t would increase the confidence in consumer on the capabilities of the bank (Pilorge, Ebstein, Schrezenmaier, & Turner, 2017).
Before developing any strategy for customer engagement, the first step would involve identification of the profiles of the target customers for each type of social media platform. Various platforms that can be explored for demographic profiling of customers include Facebook, twitter, Instagram, LinkedIn, Pinterest and several more. There are also some third-party solutions that can help organizations identify customer segments in the finance industry such as Acxiom and Datalogix. These solutions can help identify customers that have similar potential through the use of CRM for segmentation. This data can help companies understand consumers and even make predictions about their future behaviour as consumers. For instance, 47% of the digital consumers who are active Pinners are seen to be having some major life even within 6 months as per Milward Brown study. These events could be purchase of a home, purchase of a car, marriage or birth of a baby. Thus, Pinterest engagements can be explored to understand their affinities such that their future plans can be predicted (Johansen, 2012).
While social media can be used to connect with the customers, it also provides metrics that can help company assess its situation with respect to the capability of engagement to build awareness about the brand, bring favourability in customers or lead a customer to a purchase intent. Social media is like a live platform that allows banks to engage with a large number of consumers and customers. Event targeting, a popular strategy is used by banks for reaching users in real time moments through the use of engagement tactics like tailored tweets that drive conversations. For instance, insurance brands in the financial sector have used sporting events like Super Bowl madness to engage with its customers (Adaptly, 2016)
Besides engagement of users, banks can also make use of the data obtained from these engagements to understand customers and serve them better as well as enhance their engagement strategy in future for increasing engagement. The data provides both qualitative and quantitative insights that can help banks build a unique experience for the customers through personalized strategies that create a value add over their regular services received directly through the bank. While customers see no difference between the services offered by different banks, this social media engagement can make a difference. A study conducted on 10,000 respondents of banking communication over 3 years by Viacom has revealed that people who face any trouble accessing services online are more likely to connect with the customer services of a bank immediately. Most of these consumers include the youth and young adults. Reaching older generation through the digital media is more challenging as they need more assistance for learning how systems work in the digital space. Several banks have taken effort to fill this gap such as Barclays bank that initiated Digital Eagles Program for providing basic teaching on internet skills to elderly consumers.
Banks today have their customers as the central point of considerations while deciding channel strategies. Forrester Research has conducted a study on customer experience which suggests that the holistic experience of the consumer can drive revenues for the bank. The study found that 10 incremental purchases made by the existing customers of the bank can generate up to $81 million of the revenue benefit while reduction in customer churn can help banks gain retained revenue of up to $73 million. Incremental sales that banks have received from the positve word of mouth of existing customers were found to be $7 million (Cooper, Jayakumar, Kim, Palmer, & Ruddenklau, 2011).
BNP Paribas bank had started a multi-channel model for servicing by migrating data from all its contact centres, websites, and branches to bring into a single CRM environment. Société Générale uses a similar strategy for building relationships with its customers relying on social media platforms like Twitter and Facebook. Satander, another banking organization from Spain used CRM for creating demographic segmentation and explored the data obtained from them for measuring the customer’s propensity towards future purchases. HSBC, UK makes a choice of a preferred channel for carrying out banking transactions by exploring the data for identification of most profitable customers and allows them to take more control over their transactions (Lee, Mathena, Goodall, Finklestein, & Wong, 2013).
To understand what is keeping HSBC bank from creating a good customer experience over social media, there is a need to assess its strategies and results against the industry benchmarks. Integration of different media channels may be done for gathering customer data for analysis of the customer utilization and identification of their preferences across different media channels. A consistency is required to be built in communications spread across media channels (Cognizant, 2014).
Newer strategies that are not used currently by HSBC may be explored to understand their potential to increase customer engagement. For instance, merchant funded offers are given to consumers using credit or debit cards for making purchases. For this, targeted offers can be shown to customers via different touch points such as while making ATM transactions or while browsing HSBC website (Taylor, 2011).
Choice of appropriate strategy would be largely dependent on the data provided by the consumers which would help the bank understand the behaviour and preferences of customers. A study conducted by Cisco Systems, Inc. Shows that a majority of 78% of customers prefer to share more of their information in return for the personalized services provided by the bank. 56% of the consumers receiving simplified management services for their finance are likely to give away more information to the bank. Thus, these strategies of engagement can bring up the customer satisfaction as well as help the organization in keeping consumers engaged throughout their experience journey (DeLaCastro, Pande, Kulkarni, & Vaidyanathan, 2014).
This research would use a mixed methodology as it first needs to understand the situation of HSBC so that the need for improvement can be identified and then it needs to qualitatively explore various engagement practices used by other banking organizations such that appropriate recommendations can be made for improving the situation of HSBC in UK.
For understanding the situation of HSBC, a quantitative inquiry would be done in which figures would be collected on the consumer engagement over social media by HSBC which would include the use of social media including number of posts and the engagement of consumers including the maximum and minimum likes they have given and the number of followers HSBC has over social media. Analysis of this data would help the research understand the effectiveness of the current social media engagement strategies and identify the needs for improvement. It would suggest what strategies are actually engaging consumers and what are not working.
Further, a qualitative inquiry on the use of social media by other banks would be helpful for the researcher in identifying the best practices in the industry such that appropriate recommendations can be made for HSBC to improve their social media engagement with consumers (Bryman, 2012).
This research needs an analysis of how social media is used for consumer engagement and why banking organizations are using it. As this research does not have any specific attributes defined for testing, there would not be any hypothesis development possible. Hence, a descriptive and exploratory research approach would be used for understanding the situation of HSBC and then exploring the best practices in social media engagement (Daniel & Sam, 2011).
For the exploration of the current situation of HSBC, a data would be collected from 50 consumers engaged with HSBC some way over social media for understanding how they can be segmented using parameters of demography and social media behavioural data. Further, it would include collection of the data on 100 social media campaigns run by HSBC with identification of the approaches taken by the company such as personalization of the marketing offers, testing and learning strategy, and event driven marketing. The data would also include the respective likes, shares, and comments gained from the consumers on these social media posts.
For identifying specific challenge that the company may be facing while defining consumer engagement strategies, two marketing managers would be chosen from the bank and would be interviewed. For more qualitative data, secondary data sources would be used for collecting case studies of different marketing campaigns run by different banking organization. Each case would investigate a specific type of engagement strategy used by banks over social media to assess its effectiveness and potential to be used by HSBC.
MS excel would be used for the analysis of the consumer engagement data obtained from HSBC exploration and statistical tables, bar graphs and pie charts would be used to present the results of the analysis. For the analyses of the qualitative interview data, a thematic analysis would be used which would include identification of the thematic codes explaining the situation of HSBC and identification of gaps for improvement.
For the analysis of the qualitative industry data ob best practices of consumer engagement on social media, case study analysis would be used such that multiple case studies would be explored sequentially and then a comprehensive view of the same would be presented by combining the findings from the case study analysis which would be used for coming up with engagement strategy recommendations for HSBC. Each case study would deal with specific consumer engagement strategy used by banks over social media including personalized offers, and real time driven marketing. The objectives of these case studies would be to explore how these strategies are used and to assess how effective they have been in engaging consumers over social media as well as run a feasibility check on them to understand if the same can be effectively used by HSBC for engaging their consumers.
Chapter 1: Introduction – This would be an introduction to the research including its significance aims and objectives
Chapter 2: Literature review – This would contain the conceptual foundation of the research including al the related stories and models as well as pasts studies conducted in the field. A gap would be analyzed in the research that would be filled with the current research.
Chapter 3: Methodology – This section would explain the mixed research methodology that would be used in this research identifying methods that would be used for collecting data and analyseing the same.
Chapter 4: Data Analysis – The data collected would be analyzed and the results would be presented in this section with interpretations and relevant discussions on the object
Chapter 5: Conclusions and recommendations – In this section, the discussions and research findings would be summarized and appropriate recommendations would be made on the engagement strategy for HSBC based on the discussions.
The budget allotted to this project is $1200 and the project would be completed in 6 months as per the timeline presented below:
|
Research Task |
Starting Date |
Milestone Date |
Duration |
|
Full project proposal |
10th Sept 2017 |
4th Oct 2017 |
14 days |
|
Refining objectives |
4th Oct 2017 |
6th Oct 2017 |
3 days |
|
Literature review |
7th Oct 2017 |
7th Dec 2017 |
60 days |
|
Data collection |
8th Dec 2017 |
10th Feb 2018 |
62 days |
|
Data Analysis |
11th Feb 2018 |
10th Mar 2018 |
30 days |
|
Report preparation |
11th Mar 2018 |
20th Mar 2018 |
9 days |
|
Proofreading and editing |
20th Mar 2018 |
31st mar 2018 |
12 days |
|
Report submission |
1st Apr 2018 |
5th Apr 2018 |
5 days |
Conclusions
This paper proposes a research to be conducted on the use of social media for customer engagement for the Banking sector. A case of HSBC would be taken and the inquiry would be run on the system using data analysis for understanding their challenges and interviews would be taken of the managers to explore the challenges and opportunities in detail. The interview responses would be analyzed using thematic analysis. The mixed approach would also involve secondary case study analysis on various best practices of social media engagement.
References
Adaptly. (2016). Money Matters on Social Media: How Financial Services Brands Can Engage Customers with Paid Social. Adaptly.
Ahluwalia, L. (2015, August 18). Social Media in the Financial Industry. Retrieved March 02, 2017, from https://www.hallaminternet.com/social-media-in-the-financial-industry/
Bryman, A. (2012). Social Research Methods. Oxford: Oxford University Press.
Cognizant. (2014). How Banks Can Use Social Media Analytics To Drive Business Advantage. Cognizant.
Cooper, J., Jayakumar, A., Kim, W., Palmer, G., & Ruddenklau, A. (2011). The new digital tipping point. PWC.
Daniel, P., & Sam, A. (2011). Research Methodology. New York: Gyan Publishing House.
DeLaCastro, S., Pande, M., Kulkarni, S., & Vaidyanathan, A. (2014). For Effective Digital Banking Channels,Put Customers First. Cognizant.
Desmares, P., & Sharma, V. (2013). The Global Retail Banking Digital Marketing Report. WIPRO.
Gill, J., & Johnson, P. (2010). Research Methods for Managers. SAGE: London.
Johansen, M. (2012). Customer Engagement on Facebook:A Social Brand Experience? NHH.
Lee, L., Mathena, J., Goodall, S., Finklestein, P., & Wong, C. (2013). Who says banks can’t be social? Ddeloitte.
Marous, J. (2014, May 5). Minding The Gap in Social Banking Expectations. Retrieved March 02, 2017, from https://thefinancialbrand.com/39352/2014-capgemini-social-media-banking-research-study/
Pilorge, P., Ebstein, D., Schrezenmaier, T., & Turner, A. S. (2017). Defining the new drivers of customer engagement. EYGM Limited.
Taylor, J. (2011). Responsive Customer Engagement in Banking. Decision Management Solutions.
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