This article first appeared in the Winter 2012 issue of Consulting Insights.
In early April, Corporate Insight will publish a new syndicated report on the use of social media by financial services companies. This Social Media Leaders report will mark our third such study since we began tracking the topic back in the spring of 2008.
The industry has certainly evolved over the last four years. When we published our first report, Social Media: Trends & Tactics in the Financial Services Industry, roughly a quarter of the firms we tracked at the time were actively participating in the social Web. A few pioneers had developed their own proprietary blogs and communities, and some had created profiles on Facebook and still-nascent Twitter. Most firms, however, were unsure of the benefits of social media and frightened of potential compliance ramifications, and thus remained on the sidelines.
Today, nearly ever firm we track has some social presence. Blogs and online communities continue to grow in popularity while Facebook and Twitter pages are now widespread across the industry. No longer the sign of an innovative, forward-thinking company, participation on these sites has become an expected part of a firm’s broader branding, marketing and communications strategy.
In our past social media reports, we helped our clients understand the complete social landscape and what each of their competitors and other financial services companies were doing to harness the power of these communication tools. But with so many firms now participating in the social Web, we feel it has become much more important to start measuring the effectiveness of individual firms’ strategies to identify the industry’s best practices.
As we developed our grading criteria, we isolated metrics that will allow us to measure things such as activity level, engagement with clients and prospects, and overall commitment to a social media channel. In this article, we share some of the broad findings from our initial research.
Building a Fanbase
The most visible Facebook metric has always been number of fans. It provides insight into the popularity of the company’s brand and the reach of its communications. Traditionally, credit card companies have dominated this category, especially American Express and Chase, both of which have multiple pages in the top ten among the financial services.
The average number of Facebook fans across the financial services industry is a rather impressive 180,000. However, when we remove the top ten accounts, which includes six firms with over a million fans, that number decreases dramatically to roughly 35,000.
“Talking About This”
Of course, having a lot of Facebook fans is a good thing, but it doesn’t tell the whole story about the effectiveness of one page versus another. Fortunately, Facebook recently started providing a new “Talking About This” metric, which measures user-initiated activity related to the page including wall posts, likes, comments and shares. Credit card companies and insurance firms dominate this metric, with an average of 2,000 people talking about their pages, well over the industry average of 1,300. Of course, it’s important to note that the industry average is again much lower – 400 – when you remove the top 10 firms.
Weighing Likes, Comments and Shares
The “Talking About This” metric is a quick and easy way to understand how successful a firm is at getting their fans to interact with their page. However, we believe there should be a distinction between actions such as likes versus comments. After all, it’s easier and takes less time to simply click a “like” button than it does to write a response. Sharing content, on the other hand, doesn’t necessarily require more time, but it does demonstrate that the underlying content is relevant or interesting enough to the fan that they advocate it themselves.
In order to better understand how often firms receive feedback from their fans in the form of likes, comments and shares, we collected data from each firm Corporate Insight tracks over the period starting October 1, 2011 and ending December 31.
Some firms benefited from the timing of our research, as it coincided with major marketing and/or advertising initiatives. In the instance of American Express’s Small Business Saturday page, the firm’s activity was so unusual — the firm received seven times more likes per post and 46 times more shares per post than any other firm — that we removed the data from our industry averages.
Overall, financial services firms are doing a good job engaging their fans with the content they publish on their Facebook pages. Once again, the credit card industry leads the pack in terms of comments and likes per post. When it comes to sharing content, insurance firms edge out the rest of the industry with an average of over five shares per post.
Of course, there’s more to the success or failure of a Facebook page than the industry it represents. In fact, the focus or purpose of a page is much more important. While general company pages can be and oftentimes are quite successful, we’ve witnessed a few particular page types do extremely well in gaining fans and encouraging interaction.
Charity-related pages like Chase Community Giving and the American Express Members Project have long been in the top ten in terms of number of fans, but they also do a great job generating likes, comments and shares. Company sponsor or mascot pages, like Progressive’s “Flo,” Discover’s “Peggy” and Geico’s “Gecko,” also appeal to a wide audience. While the messages posted on these pages are often unrelated to the products and services offered by the firms, their humor and entertainment value resonate with fans, helping to promote the brands they represent.
So who has the most effective Facebook page and overall social media strategy? Stay tuned for our upcoming report, due out later this quarter. We’ll provide effectiveness scores for firms’ individual properties and social media channels, as well as a score for their overall social media efforts. We will also provide in-depth reviews of the leaders in each industry segment (e.g., credit card issuers), property type (e.g., blogs) and social network (e.g., Twitter).