social media & the financial sector

Social Media and the Financial Sector

Parakum Pathirana Head of IT Security & Compliance/ Principal Consultant – LOLC Technologies MSc, FBCS, CISA, CISM, CGEIT, CISSP, ISO 27001 LA, MCP, CHFI, QCS, ITIL

Dilbert on Social Media

Agenda

Introduction

Social Media potential in the finance sector

Untapped potential

Fears and challenges

How the finance sector is utilizing social media

Social Media Growth

Social Media : Core Principles

Challenges for the Financial Sector

What interests your organization most about social media?

Five Financial sector fears of social media

Current social media interactions

Who holds responsibility for social media

Introduction

• Match made in heaven? Or ?

• Similarities

• “Many talk about it? Few are doing it and those that are, aren’t doing it that well, with one or two exceptions”

• Realities

• Marketing of financial products are highly regulated

• Financial crisis & potential customer backlash

• Lost of customer trust

• “In 1983, 90% of public agreed that banks in Britain are well run, compared to 19% in 2003” – British Social Attitudes Survey

Social Media Growth

Social Media potential in the finance sector

• 25% of respondents felt that social media offers a new way to communicate to tomorrow's consumers

• 57% of financial services professionals are interested in social media

• 41% interested in discussions of their brand on social media

• 30% see social media as the future of communications

• 81% feels that Twitter is more important than Facebook or LinkedIn

-Cicero Consulting 2012-

Untapped potential

• Nearly 60% think that their industry has so far not been effective in utilizing social media

• 38% are concerned that they are missing out due to lack of time and resources dedicated to social media

• Less than half of surveyed firms are making effective use of social media, and a tenth are not even considering how they could do so


Fears and challenges

• Five fears: potential brand damage, compliance issues, lack of expertise, difficulty in measuring ROI and resource

• 25% are daunted by volume of traffic and how to monitor and manage

• One third are concerned of lack on internal understanding within their organization to make the most out of it

• 38% concerned because lack of time and resources dedicated to it -Cicero Consulting 2012-

How the finance sector is utilizing social media

•36% to support business activity, 11% have fully integrated into their business strategy

•40% interested because their brand is discussed online

•59% of firms spending less than 50,000 GBP per year, while 29% are spending nothing -Cicero Consulting 2012-

Social Media Growth

Facebook users in millions Source: Benfoster.com

Social Media : Core Principles

“Man is by nature a social animal”


•External • Loosing consumer trust

• Consumer behavior

• E.g. National Union of Students protest against HSBC, #occupywallstreet

• Other movements


•Internal

•Strictly regulated with detailed compliance and guidelines

•Regulators fall behind

•Inability to enforce certain controls due to social media’s fluidity

What interests your organization most about social media?


Five Financial sector fears of social media

Current social media interactions

Who holds responsibility for social media

Questions and Answers