Skip to Main Content

Ant Ozok’s Daily Record Interview

Banks using tweets, status updates to reach customers

By: Anamika Roy Business Writer October 27, 2015

CoverPictureWhen your ATM card doesn’t work, instead of calling your bank and laboring through seemingly endless instrumental music while on hold, imagine posting a comment on its Facebook page and someone attending to your problem.

As more and more banks embrace social media, they are making space for themselves alongside retail giants and other corporations that use platforms such as Facebook and Twitter to promote their brands.

“We try to use social media to educate people and to be a resource to customers,” said Erica Starr, director of marketing at 1st Mariner Bank.

Banks of all sizes try to engage with customers on social media. Bank of America, the largest banking operation in Maryland, has nearly 2.3 million Facebook “likes.” M&T Bank, which has the state’s second-largest footprint, has about 77,000 “likes.” 1st Mariner Bank, a Baltimore-based community bank has around 4,300 “likes.”

Despite the differences in size and reach, the banks are similar in terms of their types of online content.

Starr describes 1st Mariner’s online content as having a “financial flair.” Whether it’s advice for couples planning a wedding on a budget or parents opening a 529 college savings plan for their child.

“Social media is a great space where you can liven your brand,” said Phil Hosmer, a spokesman for M&T Bank.

Online campaigns

Earlier this year, M&T held a “What’s Important To You?” social media campaign in which users submitted stories about what they would do with $5,000 to help other people. The promotion attracted more than 2,000 entries and 14,600 votes.

Aside from better branding, social media gives customers another way to contact their bank. And response times are generally short.

1st Mariner Bank’s marketing team has constant access to its Twitter and Facebook accounts, allowing them to respond to customer questions or acknowledge a query as quickly as possible. M&T has a customer service team that monitors Facebook and Twitter. The bank has a designated Twitter handle, @MandT_Help, for customer service questions that is regularly updated.

Despite these initiatives, Ant Ozok, an associate professor in the department of information systems at University of Maryland, Baltimore County doesn’t think banks have seized social media’s advantages in the way retailers have.

“Unlike retailers, banks have not found a way to crack social media in a useful, meaningful and profitable way,” he said, adding that mortgages and credit cards are often difficult to sell on social media, given the complexities and regulations surrounding those products.

Of the top 10 brands with the most Facebook fans, none are financial institutions, according to a social media guide for financial institutions published by Chapman and Cutler LLP. Among financial institutions, Capital One, Bank of America and Citibank have the largest number of fans on both Facebook and Twitter.

In 2013 the Federal Financial Institutions Examination Council developed a set of social media guidelines for financial institutions regulated by federal banking agencies, the Consumer Financial Protection Bureau and the National Credit Union Administration. The guidelines must be incorporated into risk management programs for financial institutions.

Data mining

Retailers, with help from Facebook’s sophisticated data mining algorithms, often use their social media following to gather information about their customers, but Hosmer at M&T said the bank doesn’t gather any third-party data nor does it have any way to determine whether its followers are actually customers.

1st Mariner can sometimes match its followers’ Facebook account email address with the email address they have on file with bank, but that doesn’t always give the full picture, Starr said.

“I haven’t come across any significant action that the banks take to improve their business through data mining on social media so far,” said Ozak, adding that customers may have a more negative reaction to getting targeted ads from a bank compared to a clothing store.

“Banks will have more issues,” he said.

Despite those reservations, banks believe customers are more open to interacting with them in the same space where they post status updates. 1st Mariner, which has been on Facebook since 2009, has seen that shift.

“It’s not so much a weird thing to follow your bank on Facebook,” Starr said.