Blog — 23 March 2012

What does a bank mean to you? The friendly neighbourhood banker who tells you which fund to invest in? Or the bald-headed guy willing to give you some dough, without security when you’re really hard up? My bank is a bookmark in my web browser and an ATM. I can’t recall the last time I walked into an actual bank.

Unless you’re a business customer (with cash transactions) or one of the super rich with a personal banker, you’re also likely to transact into the cloud, like me!

No-one at my bank knows me at all, and I don’t know them! Over 90% of my transactions in the past 3 years were on online  or at an ATM, or through ‘Self-Service’ channels.

To futher the distance, the bank announce new technology features, every month, designed to enable me to bank remotely. Currently, the only time I choose to go to a branch or talk to an unhelpful ‘phone banker’ is when I’m irate with an unresolved problem. The issue with this is; I associate ‘human’ contact with mistakes – not the seemless 90% service.

Unfortunately, but not sureprisingly, banks seem to prefer this scenario, clearly underestimating the long term impact upon their customers. After all, a branch transaction is nearly a thousand times the cost of an online transaction. Somehow, navigating between the ATM, internet banking, card payments, the much dreaded phone banking and now half-baked mobile apps, the ‘social’ touch of banking has almost vanished.

‘Why should that be a problem?’ you ask, “It’s all so much more convenient for the consumer now!”

Not for the Bank it isn’t. Having worked with a large private bank for nearly 10 years, I know how difficult it is to get the customers to trust the ‘banker’.

When a friend wanted a home loan with a higher requirement, he went to a public sector bank (PSU), instead of going to the tech-savvy private bank he usually banks with. His reason; the PSU Branch Manager remembers him by name, even though he has just a small savings account with the bank. He required a loan of a little more than usual; the PSU bank obliged, gladly. He also didn’t know where the private bank’s nearest branch was, he’d opened the account from the ‘convenience of his home’.

The biggest problem with ‘self service?’ When a customer has a problem and approaches the bank, the bank officer has very little knowledge of the customer or the background of a problem. So it becomes very convenient for the bank officer to tag the problem with a ‘service request number’ and push it into a workflow process system and expect it to be magically solved by the invisible ‘someone else’. Disgusted with lack of solutions in this normal course devoid of transparency, another acquaintance of mine decided to make the MD of a bank his ‘personal banker’. Even when he wants the smallest of the issues solved, he shoots off a strongly worded email to the MD and recieves his solutions, instantly. Nobody else takes ownership.

When I read the Cluetrain Manifesto, I thought of these banks. It is true that the markets now speak in a ‘human voice’ which is natural, open, honest, direct, funny and often shocking. On the other hand, the tech-savvy banks are still telling us that our-call-is-important-to-them while we wait endlessly! The Manifesto foresaw the dawn of the social media and its impact upon businesses!

The reality is; customer loyalty isn’t a problem for the bank. It won’t affect the balance sheet or the stock price. However, in extraordinary situations like a run on the bank, such as the ones in 2008, the sudden appearance of a human face trying to pacify panicked customers is of no avail. The preceeding marketing blitzkrieg did not rebuild the kind of trust a human can.

Banks failed to realise the power of word-of-mouth and the powerful far reaching medium of social media. These conversations are the exact social interaction banks desparatly need to nurture and engage in. The Manifesto says, ‘Companies need to realize their markets are often laughing; at them.’

A recent example made me read the Cluetrain Manifesto all over again. ICICI Bank recently launched a Facebook page to much fanfare; in the process, managing the nearly impossible task of marrying ‘asocial’ to the ‘social’. The first few posts were celebratory, unveiling the page. The unavoidable promotional offers followed. The tone quickly became apologetic after some of the promised features were discovered to be non-starters. The ‘fans’ were polite, initially. How do I use so-and-so feature? I want a card, I want an account, to I want a response to my complaint etc. Eerily, there were no direct replies from the page owner. Fans started answering each other, with no participation from the Bank. Some fans are telling prospective customers not to bank with ICICI for whatever reason, with absolutely no efforts from the bank to intervene. It was a social media crisis, left to fester amoung the Pages fans.

With no direct replies and efforts to convince people that genuine bank employees are manning the page, fans will quickly move away from creating conversations. What remains on the page is the same robotic posts promoting the latest product. What’s the point of a social media property, without the conversations? What’s a Facebook page without ‘social’?

ICICI Bank managed to put a self-service app on the Facebook page and is vigorously promoting more self-service channels like the automatic Bill Pay on its wall. In reality the real reason for the page is to show off a cool new tech app, helping customers avoid the banker, in a brand new way. The intention was never really to have genuine conversations with customers. It is apparent that the bank missed the point of ‘social media’, that contrary to the corporate perception, social media isn’t about the technology or the ad space. It is about genuine human networking!


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