Why banks need Instagram
Another version of this article was originally featured on The Financial Brand. Find it here.
Banks should exploit Instagram to show a human side to banking… while there is still an opportunity to stand out.
It helps to anticipate what your competition will do next
When Facebook first started showing ads, only a brave few companies signed up. Competition for ad space was low, so the price was negligible. There was much less noise, so getting seen by your target audience was easier.
But nowadays Facebook is cutting down ruthlessly on the amount of stuff people see, ads cost significantly more, and there’s high competition from other brands.
To illustrate, just four years ago, a brand could still reach an average of 11% of Facebook users without buying ads; today that’s just 4%.
The answer is to go where others aren’t. Instagram is one those places.
Instagram is under-exploited
Hold on. Isn’t Instagram huge? Yes, and already much bigger than the marketer’s other social media darling, Twitter.
Whilst Instagram has 500 million users — up 100 million since last year — Twitter has 310 million users…and falling.
But for brands Instagram is still relatively new and unfamiliar territory. While 93% of marketers say they use Facebook, only 44% have given Instagram a whirl.
Because competition among brands is lower, reaching customers is easier.
According to Forrester, brands on Facebook and Twitter get regular engagement with less than 0.1% of their total followers on Facebook and Twitter, but 4% of their followers on Instagram.
Furthermore, brands on Instagram can reach an average of 28% of its users without paying for their attention.
This raises a question: why is the channel under-utilized by retail banking providers?
Within the top 4500 brand Instagram accounts by number of followers (excluding celebrities), there are only 40 financial brands. The top financial brand on Instagram is Amex, but it ranks at 1481.
And not one major UK bank even has an account.
Banks lack the human touch
Let’s face it: financial institutions aren’t the most liked and admired companies out there.
A survey of 2000 UK adult consumers found that only 1 in 5 said they trusted the financial firms they dealt with. In the US, all 4 of the leading banks are among the 10 least-loved brands by millennials.
Half a decade of scandals has not done banks any favours.
The digitisation of banking is increasingly forcing banks to finally make themselves useful to customers; banks are scrambling over each other to update the functionality of their apps.
However, in the short term a move towards digital channels has the potential to exacerbate an already strained relationship between banks and their customers.
As banks try to cut costs, bank branches are being shut and Artificial Intelligence employed to replace them.
Finance experts gleefully announce that “Chatbots are coming to financial services”.
Unfortunately, research from Mintel suggests two thirds of consumers trust the staff at their local branch — much more than they trust other parts of the bank. Just 36% trust the call centre staff, and 33% trust what their bank stands for.
Add to this the bad press over staff reductions, and banks are set to have a tough job endearing themselves to their customers.
Instagram can re-humanise banking
Facebook is good for sharing information. Twitter is great for customer service. But Instagram’s visual nature gives it a role quite distinct from the others…
How? By sharing hidden stories.
Brands on social media are usually tempted to share every detail about themselves, their new app, their new ad, etc.
But this misunderstands not only human nature but the power of a channel like Instagram to emotionally engage customers through storytelling.
We can often forget that banks fulfil a critical function in our society. This is by lending money to all the businesses, particularly small businesses, that we use on a daily basis.
Banks should take advantage of this fact and share the stories of the small businesses that they work with.
The success of Humans of New York (with its six million followers) shows that people will engage in human stories and photography has a powerful role in bringing these to life. Citibank is a bank that has started to do this effectively.
The stories can come from inside the bank too.
That great case study of a staff member going above and beyond for a customer is perfect for Instagram. It’s also a way to create priceless good feeling with the business or employee in question.
This approach can be further enhanced when the stories involve the customers themselves, or people they admire.
For instance, American Express ran a campaign called #MyAmex in which admired Instagram users (aka ‘influencers’) shared how Amex impacts their business.
Over two weeks, Amex doubled its number of followers and the #MyAmex posts generated 23% more engagement than the brand’s other Instagram posts. In total, the campaign generated more than 10 million impressions and 40,000 engagements.
Similarly, Capital One created the campaign #walletstories, a play on their slogan “What’s in your wallet?”), in which influencers shared their life stories through the contents in their wallets.
Perception among millennials increased by 3% during their five-week campaign, underlining another of the channel’s advantages; Instagram has a higher reach among 18–25 year olds than any other platform except Facebook.
US Bank has also managed to bring banking to life for the younger generations.
It hired influencers to highlight, through captivating photography, the role of saving in being able to achieve the things we want in life, and how to get started.
What could have been dull marketing messages from a stuffy bank have been transformed by Instagram’s visual medium.
They also make the most of the bank’s position as an expert in personal finances.
Only 16% of UK adults believe they left school adequately equipped to manage money well. Therefore, regular money advice communicated visually could be an ideal way for banks to earn a following with Instagram’s users.
The time is now
With banks in the state that they are, not being on Instagram is a big missed opportunity. Acting now is the best way to take advantage of it.
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