Banks can tweet but will it get them in trouble?

Image by Cieleke / Stockxchng

A recent study has shown that customers who engage through social media spend 20-40% more and demonstrate greater loyalty. It’s a compelling benefit that financial institutions are keen to realise as they run campaigns to engage with their customers through social networking platforms: those ‘likes’ are translating into dollar benefits.

Like any organisation using social media to connect with customers, there are risks inherent in this comparatively new channel for communication and engagement. This is even more fraught for financial institutions who are subject to legislative requirements, financial regulations and, more subjectively, want to maintain a reputation as trustworthy and secure. This all means that Australian financial companies face unique risks when engaging through social media, such as:

These are not new risks for organisations in the financial services sector and you may well think that the existing mitigants would address these risks: these might include customer service employee training, employee policies around customer data, IT controls to prevent and address phishing attacks. Aren’t these enough?

Let’s take a closer look at Commonwealth Bank Australia, they have the most social media followers of any Australian bank and connect with their customers across multiple platforms, customers can even pay each other through facebook using the Kaching mobile application. Their customers are interacting with the bank through official social media channels such as the @commbank twitter account. What’s different to more traditional channels of communication is that any employee, not just authorised customer service staff, may be identified as a Comm Bank employee and comments they make on platforms  with their personal accounts such as facebook or twitter could be linked to the bank. Whereas previously any bank employee who comments on a cranky customer they dealt with at their mate’s backyard barbeque might not be behaving ethically but their behaviour is exposed to a close group of friends. Now, a comment made on twitter after what might have been a long and frustrating day for a branch employee can be seen by anyone!

image from darrendean at stock.xchngMany organisations are recognising the importance of a social media policy to address the risks inherent in employees engaging in social media platforms where their personal profile might be linked to the organisation, through naming their employer, their linkedin profile or other means.

Comm Bank’s social media policy, in line with many other organisations’ policies, requests that employees posting on social media sites broadcast they are CBA workers and they do not speak officially for the company. However their policy attracted a great deal of publicity last year as employees and their representatives objected to the wording of the policy and the consequences for non-compliance. This has been since been revised however it highlights the importance that a policy is not just aligned to the social media strategy, but also developed and adapted to in line with the rights and needs of employees.

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14 thoughts on “Banks can tweet but will it get them in trouble?

  1. Hi Amanda,
    Adapting new technology or new application always has its concerns specially when talking about a bank. I’m currently Commonwealth bank customer and to be honest it is my first time to know about “Kaching mobile”. Thanks for introducing such a great application.

    I really enjoyed reading your blog.

  2. I recalled reading a news headline on CBA that the bank threatens to sack staff over social media comments. Although the bank was acting in its own interest, it sounded rather harsh to the employees. I think educating the staff in doing the right thing is more powerful than inflicting fear when doing the wrong thing. I am glad they reviewed and toned it down to be fair to their employees.

    • I disagree. Education can only take you so far. For example, we’ve all been taught since we were little that it’s illegal to cross the road when the little man is red, but most people do it anyway. We look around, check to see if we’re going to get caught, and then we make a dash for it. It’s the same thing here really, staff should not be discussing work issues in such a public way. I know I would be mortified if I found out that after I’d gone into the bank with a query, the staff member that served me posted a rant on facebook about how stupid I was. While I would disagree with a one strike and you’re out clause (depending on the seriousness of the incident of course), I think that the threat of losing your job would encourage staff to make themselves aware of the social media policy and abide by it.

  3. Amanda,

    A few years ago a garbage truck was overloaded and when driving down a local street it accidently dumped some rubbish next to a local park. Amongst this rubbish was very detailed and highly confidential bank information of a certain bank and their clients. It turned out someone was not disposing of forms in the confidential bin and was just throwing it out in the general rubbish.

    Risks come in all shapes and forms, from the low tech garbage truck spilling out company details to social media risks which you have highlighted in your post. There are risks everywhere, but with the right policy in place some of these hopefully will be reduced.

    -David Taylor

  4. You say many organisations are adopting social media policies to protect themselves and protect their customers – I feel as though this distances the company from interacting with the customers honestly. I understand the need for proper form and process but have you seen any examples of companies that “keep it real” with their social media policies and are up front, honest and more free flowing in their form of customer interaction?

    ~origamiJoe

    • I think its a major challenge for organisations like banks. Social media communication channels seem to work best when it’s a ‘human’ voice behind the tweets. But then our expectations of banks may preclude a personal style, for example, I think it’s fine for queensland rail to acknowledge a train running late but I’m not sure whether it’s fine for a bank to acknowledge the late fees are unfair. To answer your question, I think there are companies that come across as ‘real’, as responding with honesty to the dialogue addressed to them. I’m not aware of any bank that does this with the same ease, perhaps because of a reluctance to embrace the more casual nature of social network communication, and perhaps because there are widely varying expectations of an appropriate level of informality for a bank? Do you think bank twitter accounts could be more real?

      • I definitely do find them stiff like cardboard cut outs so they could do with more reality. They have a fast and easy way to do market research on their customer base with the media’s, and while that doesn’t encapsulate their entire market it would be very useful for feedback on online services with the leaders of social media hopefully being able to represent the needs and wants of the technologically savvy.

  5. This is all about information leak from employee who engage customer using social medias. I think it is very scary in many ‘what if situations’ that could happen from the information leak. The amount of money that customer lost could be extreme so the employees have to be very careful. The social medias policies can help but people still make mistake so it’s a risk that the organization and the employees need to face.

    Cheers,

    Prapat W.

    • It’s a good point, a policy isn’t enough on its own, there needs to be monitoring in place to protect against mistakes and also deliberate breaches of a company’s policy. Thanks Prapat.

  6. I think a bank is a different kettle of fish with their social media policies. I think they have the right to be more harsh than other organisations. If someone is contacting a customer from a legitimate bank address how is the customer to know that they are not genuine, that the employee is acting on their own accord and not actually representing the company. I say if bank employees abuse social media (especially for personal gain) the penalties should be harsh.

    • Yes, it’s so much more complex than just a cookie cutter social media policy for all industries, isn’t it.

      We need to be able to trust our banks with our private information. It’s true, bank employees should be aware of their responsibilities when representing the company. I guess this is why a social media policy is so important in this industry.

  7. Hi Amanda.
    Good post. That makes me think in what sense a broken social media policy can impact the employee? For example if by impulse a employee blog something about a confidencial new product going to market soon and that affects the expected outcomes because the competitors lunched similar products. Apart from being fired :), what other impact can the employee be affect by?
    Anyone has read an study case about that?
    Cheers,

    Charles (http://charlestontelles.wordpress.com/)

  8. Morning Amanda,
    When i read banks tweeting, you had me worried! Your post was extremely well written. Love how well you adapted the risks to the specific financial industry. I would hate to be the one authorised to maintain and oversee the social media implementations.
    There are so many risks in what Commonwealth Bank are implementing but do you feel secure knowing that bank is commonwealth supported and have such a decent reputation? I don’t suppose you know of any risks that have come into fruition?
    Thanks for the quality read,
    Caleb

    • Currently there’s a hashtag #commbankwont and a protest against the scale of CBAs profit: the tweets are along the theme of ‘while I spent 30 minutes on the bus to work, commbank made $404,680 profit’. The approach they have taken is to not respond to the campaign but it’s a small example of the reputation risk being realised.

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