Document Type
Conference Proceeding
Conference Track
Social Media/ Internet/ Mobile/ Direct Marketing
Publication Date
2014
Abstract
Innovative strategies set a company apart from its competitors. Lindsay and Hopkins (2010) said strategy is making the most of a current situation and devising a plan for the future. Likewise, if banks and other financial organizations want to enhance their brands, reduce costs, increase customer satisfaction, boost innovation, increase revenue, and maintain their competitive positions, they need to embrace social media. Social networks are used by marketers to connect and communicate with customers (Mangold & Faulds, 2009). Organizations must be receptive and flexible to remain relevant in the business environment (Bouckenooghe, Devos, & Van den Broeck, 2009). The environment outside of an organization is constantly changing (Burnes, 2004). Banks and financial organizations must decide how they will respond to social media as a disruptive innovation. This non-empirical paper will discuss financial organizations and the competition they are facing. It will discuss how the financial organizations competitors are using social media and other innovative technologies. It will discuss the influence of social media in the financial services industry and how financial organizations are using social media. It will also explain how and why the financial services industry can use social media to market products and services and build brand awareness. Finally, it will also discuss how financial services organizations can use social media to reach out to employees, develop interpersonal social networks, and build effective relationships as part of a successful Integrated Marketing Communication (IMC) program. Kaplan and Haenlein (2010) said that social media allow firms to engage in timely and direct end-consumer contact at relatively low cost and higher levels of efficiency than can be achieved with more traditional communication tools. Social media is on the top of the agenda for many executives. Decision makers, as well as consultants, try to identify ways firms can make profitable uses of applications such as Wikipedia, YouTube, Facebook, Second Life, and Twitter. Yet despite this interest, there seems to be very limited understanding of the term social media. Mangold and Faulds (2009) found that the tools and strategies for communicating with customers have changed significantly with the emergence of social media. Therefore, when developing and executing integrated marketing communications strategies, marketing managers should include social media in the marketing mix (Mangold & Faulds, 2009). According to Farshid, Plangger, and Nel (2011, p.220): Social media has changed the way both organizations and their brands interact with customers, as well as the way in which business gets done. The emergence of the phenomenon known as Internet-based social media has made it possible for individuals to communicate with thousands of others about companies' products, services and brands. Organizations use social media not only to reach existing customers and capture new ones, but also to become part of their customers' conversations to build or maintain their brands’ credibility and reputation. When facing disruptive innovations, organizations must be receptive and open to change. In times of change, people are not motivated to change unless there are compelling reasons to do so. Bouckenooghe, Devos, and Van den Broeck (2009, p. 59) said that “a key issue in managing and planning change is creating a basis that supports change.” Therefore, when facing disruptive innovations, organizational success may be related to the internal circumstances under which change occurs, the process of how change is dealt with, and the level of readiness for change in understanding the processes that lead to successful change implementation The pace of change in the use of social media is increasing and can be generated from both internal and external forces (Burnes, 2004; Kotter, 1995; Luecke, 2003). In developing a social media strategy, organizations must be and flexible in order to remain relevant in the business environment (Bouckenooghe et al., 2009).
Copyright Statement / License for Reuse
Digital Commons@Georgia Southern License
Recommended Citation
Gibbs, Nathaniel and Haan, Perry, "Social Media in the Financial Services Industry" (2014). Association of Marketing Theory and Practice Proceedings 2014. 49.
https://digitalcommons.georgiasouthern.edu/amtp-proceedings_2014/49
About the Authors
Nathaniel Gibbs is a DBA learner in the School of Business and Technology at Capella University. Gibbs holds a MBA with a concentration in Marketing from the College of Business at Argosy University, Atlanta, Georgia. He is a member of Sigma Beta Delta Honor Society. Gibbs is currently employed as the Marketing Director with Creative Enterprises Foundation in Atlanta, Georgia.
Perry Haan (DBA, University of Sarasota) is Professor of Marketing and Entrepreneurship at Tiffin University in Tiffin, Ohio. Haan served as Tiffin University Dean of the School of Business from 2007-2010. He has authored or co-authored over 60 peer reviewed articles. He co-authored a textbook Practical Statistics for Business. His research interests include entrepreneurship, international business, ethics, sales and sales management, education marketing, and sports marketing.