How Social Media Is Shaping Financial Services

Social media is transforming banking relationships in very significant ways, from improving customer service to allowing users to send money to others via online platforms. New financial technology companies are using social media data to help people get access to credit or even simply open a bank account. Social media can even impact your ability to get a loan. Integration is happing so quickly, it is possible to argue that social media platforms may be the banks of the future.

Social media platforms can no longer be considered places where people simply connect and communicate in real-time with the click of a button. Platforms, such as WeChat and Viber in Asia as well as the global powerhouse that is Facebook, are increasingly providing a broad range of services to their users either directly or through partners, making them central to people’s lives.

Such high levels of penetration, use and engagement have meant that financial institutions are starting to recognize the opportunities social media can bring to their businesses. They are looking to gain a competitive advantage over other institutions while also trying to mitigate the threats posed by social media, such as when people share highly sensitive information publicly.

In addition, regulative complexity and a traditional cultural mindset has meant that until recently, the financial services sector has lagged behind some other sectors in their comprehensive adoption of social media and technology.

But things are moving very quickly. Financial Technology (FinTech) has emerged as its own industry, encompassing companies that use technology to make financial systems more efficient. A report by Accenture and the Partnership Fund indicated that global investment in FinTech ventures has tripled from around $1 billion in 2008 to nearly $3 billion in 2013. Many of these companies are using social media to revolutionize the traditional business models that the finance sector has relied upon for decades.

There are five key areas where social media is changing financial services around the world:

1. Customer Service

A growing number of customers expect real-time responses from their service providers. When customers are not happy with the service they are receiving and want to vent their frustration, they increasingly turn to public channels, aware that no company wants the negative publicity. Thus more and more banks and insurance companies are adding social media (usually Twitter and Facebook pages) as a permanent channel for retail customer interaction, fully integrated into Customer Relationship Management (CRM) systems. In September 2014, Econsultancy compared the response rates of 16 retail banks on social media in the UK. The quickest response time was three minutes, and the longest was one hour and twenty-four minutes.

This type of public customer service requires caution. The biggest challenge is maintaining security standards when customers unknowingly provide personal information. As a result, banks have had to implement sophisticated social media policies to handle situations with sometimes emotional clients, since conversations that were previously private and one-on-one are now being broadcast for everyone to see.

2. Marketing

Social media marketing can no longer be disassociated from a company’s overall marketing strategy, forcing them to adopt not only a data-driven approach but also a test-and-learn mindset that can handle an ever-changing social environment. According to Accenture, the results are clear: better segmentation, real-time marketing, reduced acquisition costs and quicker time to market are requirements of a solid marketing strategy.

Many online retail P2P lenders such as Lending Club and Prosper, and small business lenders such as Kabbage and OnDeck have grown exponentially by using online and social media as their core marketing channels. More traditional companies are also investing in social media integration. American Express, for example, links a client’s Amex card with his or her social media profiles on platforms such as Facebook and FourSquare, and then delivers deals based on activity such as likes and check-ins. The credit card company has won awards for this social innovation.

3. New Product/Service Development

Social media is not just being used to deliver new products and services, it is also being used to design them. In Turkey, DenizBank has revolutionized the banking model by offering banking services through Facebook: customers can connect to their Facebook account and access their bank account to initiate wire transfers and manage daily expenses by monitoring their credit cards. Another example is Barclaycard’s Ring Mastercard, which was developed through crowdsourcing on social media to design and pick the most popular features for the new product.

4. Reducing Costs and Improving Efficiencies

In addition to using Facebook to reduce the costs of customer service, banks are using it as an alternative to online banking and an efficient way to process applications. In October 2013, ICICI bank, an Indian multinational banking and financial services company, launched Pockets, a mobile app that allows users to login to their bank using their Facebook credentials. The app allows users to send money to friends, pay utility bills, recharge mobile phones, and buy movie tickets. The fact that banks are using Facebook credentials to verify identity marks an important turning point for banking institutions.

5. New Business Models

Chinese social media platforms are leading the way in the exciting area of creating new business models using social media. A useful summary of the scale of this innovation in China is provided here by Bloomberg; an individual can pay their rent using Alipay from Alibaba, bank using WeChat’s WeBank and buy mutual funds from Baidu. More than 100 million of the 815 million active users of Tencent’s QQ messaging service have already integrated their bank cards with the QQ Wallet.

Lenders are now using social media to credit rate applicants, and banks are asking people to use social media for references, meaning more people are receiving loans who would not have been given a second look previously. China has even given Tencent and Alibaba credit information bureau licenses.


Generally, adoption has been slow and most traditional banks today have only implemented limited programs, which are often run in isolation from the core business and not as an integrated solution. The opportunities social media provides do not concern only customer service and marketing, but more fundamentally affect the products and services themselves. New business models are changing the entire industry. Large, complex and highly regulated entities are being forced to learn how to innovate and roll out new ideas in agile ways to test and iterate quickly.

Many of the new players in the financial services sector are still trying to find long-term profitable business models that will stand the test of time. As they grow and time passes, they must be prepared for more regulation. It will also be critical for FinTech companies to build trust, something that banks have not always excelled at. Compliance, security and privacy will become more prominent as regulators struggle to balance the need to protect consumers and prevent money laundering while enabling greater financial inclusion throughout the world.

Finally, imagine a future where all deposits, payments, remittance and investment can be handled within social networks in easy and intuitive ways. In this world, cash becomes much less important and the friends you have online can support your path to financial freedom by transferring funds, vouching for you or supporting your financial goals. The friction that exists across the industry today would be dramatically reduced.

Social media is changing the way the financial services industry operates; the future is bright for increased financial inclusion, lower costs and better customer service. It remains to be seen who will ultimately emerge as the dominant force in finance, the traditional incumbents or the FinTech challengers.

Three Challenges

1. Banks and traditional incumbents must adapt to the new reality that social media is creating. Most have innovation departments, but can they translate their ideas into the core banking services that many new entrants are targeting through disruptive new business models?

2. Many of the potential benefits of social media to provide financial inclusion to millions more people and better service at reduced costs can be negated if regulation is imposed either directly or indirectly. In some cases, current laws have not been updated to allow organizations to realize the full potential of social media.

3. In the modern world, competition comes from everywhere. No longer do incumbents only have to worry about other innovative financial institutions; now social media platforms are moving into financial services and thousands of financial technology start-ups are being established each year.

By Richard Eldridge

Chief Executive Officer, Lenddo Limited.

What Marketers Need to Understand About Augmented Reality

Imagine being able to see how a couch would fit in your living room before actually buying it — or being able to see which sunglasses suit your face or which lipstick looks good on you without physically trying anything on.

Each of these scenarios is already possible. These are real examples from Ikea, Ray-Ban, and Cover Girl of how companies are currently using augmented reality (AR).

AR has been piquing marketers’ interest in recent years, as it has the potential to change a range of consumer experiences, from how people find new products to how they decide which ones to buy. AR technology enhances the physical environment you see by overlaying virtual elements, such as information or images over it, either through displays such as HoloLens and Google Glass or through the camera view on your smartphone.

In order for the potential of AR to be realized, though, companies have to resist the urge to hastily create AR apps (that risk appearing gimmicky), and instead focus on better understanding how consumers will interact with the technology. Based on research I have been conducting on consumer responses to AR over the past four years, I have found that designing and implementing valuable AR apps requires the following: a better idea of how consumers would use such technology; more collaboration among computer scientists, designers, and marketers; and a strategy for integrating the applications into the existing consumer journey.

When I started working on AR as the topic for my PhD, almost no established knowledge about it existed in the marketing field. However, computer science and human-computer interaction research have been tackling AR for years, and borrowing insights from those fields can greatly help marketers understand what this technology will mean in commercial contexts.

Companies first have to understand how AR differs from other digital technologies. While it is similar in some aspects (e.g., applications are frequently used on smartphones, the content is composed of text or images, and the apps are usually highly interactive), there is something inherently different about AR: the ability to overlay virtual content on the physical world and have the two interact in real time.

I conducted a lab experiment with 60 participants to investigate how such augmentation influences consumer responses. The study is forthcoming in the Journal of Marketing Management. Participants had to look for their preferred model of sunglasses or furniture, either using an AR app (Ikea or Ray-Ban) or an app that allowed a similar activity but without AR features. The results consistently showed that when participants perceived an element of the environment to be augmented in real-time (for example, seeing a pair of sunglasses simulated on their face or seeing a virtual chair in an office), that created an immersive experience for them, significantly more so than if the sunglasses were just stuck on their online photo or if they saw furniture in a virtual room.

I also found that the augmented experience resulted in positive attitudes toward the application and willingness to use the app again and talk about it to others. But these effects didn’t seem to extend to the products themselves or the brands, just the technology.

However, another study showed that this might change depending on how the app is integrated into the consumer journey. Working with professor Yvonne Rogers from the UCL Interaction Centre and AR designers Ana Moutinho and Russell Freeman from the AR agency Holition, we conducted one of the first studies of how consumers use AR to “try on” make-up in a store. The app we used allows people to put on virtual lipstick or eye-shadows that moves with their faces.

We found that using this AR mirror in the store helped the consumers decide what to buy. The majority of them enjoyed the playful experience that allowed them to experiment with looks that would be much harder with physical testers. More importantly, when the AR app was integrated in a familiar retail setting as a part of the shopping experience, people not only thought highly of the technology, but they also positively related to the products. They were more likely to buy them and view the app as a convenient tool for shopping, not just for playing around.

Another study that we conducted online showed that when participants frequently used a similar AR make-up app on their phones over a five-day period, they also reported positive reactions towards both the technology and the products. They perceived the app to be not only enjoyable, but also useful for shopping for make-up, which again translated in their intentions to purchase the tried-on products.

Basically, if the AR experience is just a one-off episode, which was true of the lab study, the augmentation will most likely direct people’s attention towards the technology. But if it is well integrated in an environment or in a process, it has the capacity to positively impact purchase activities and have a more far-reaching influence.

It is important to note that because shop assistants invited consumers to use the virtual mirror and showed them how to use it, it remains unclear whether customers might have a different experience without any help.

Marketers should remember that AR is not about creating a completely new reality; it’s about enhancing what already exists. When the virtual is well fitted with the physical and interacts with it, that’s when AR magic happens. As opposed to virtual reality, which immerses you into a different world (e.g. Oculus Rift), AR intertwines virtual elements that might be missing in a specific situation within physical reality (the latest best example being HoloLens’ holoportation feature). This is one of the reasons why people like Snapchat’s AR feature, where users can play with different visual effects to transform ordinary videos into shareable stories.

The crucial part of the AR experience is whether the technology adds real value. Simply overlaying something virtual on a phone screen doesn’t always cut it and can appear gimmicky. Having an ad pop up on your smartphone camera view from scanning a brand’s logo might be fun, but people would tire of it pretty quickly. Similarly, an app that overlays information and promotions on your phone screen when you point the camera to different stores on a street or products in a shop sounds useful, but marketers have to ask: Are consumers really going to walk down the street holding their tablets or smartphones in the air? Do they want to shop by scanning every product?

The answer at this point is probably no, even for digital natives. People will only change their behavior if they perceive the value is worth the effort of adding another information layer into an already saturated digital space. So it’s important to think about the contexts in which they may be willing to do this —f or example, exploring a cultural event, an urban environment, or a historical site with an AR app (similar to how people use headsets in art museums), or wanting to learn more about an expensive product or a brand they really care about.

The real mission for commercial AR is integrating the technology so that it enhances the customer experience — makes it easier, more fun, and more convenient. We don’t want to live in a world where tangible, physical elements are replaced with digital replicas. The idea of Google Glass failed because we don’t want to walk around constantly seeing everything augmented. (The way Microsoft has been positioning HoloLens may be a different story, because it is designed for specific occasions, such as meeting rooms or workshops.) So rather than thinking of how to overlay as many places as possible with additional virtual content, the key to understanding AR is defining the specific activities where it can create real value.

By Ana Javornik

The Role of Artificial Intelligence In SEO

Artificial intelligence is changing the face of SEO, with advancing algorithms which enable machines to make connections and “learn” how to process data based on human requests more effectively.

When you search for something, the results displayed take into account a bucket of considerations like your location, search history, favorite websites, and what other users have previously clicked on for a similar query. AI improvements mean that ranking factors can change from query to query, as the algorithm learns from how people are clicking on the search results and decides on the most relevant factors to take into account for each individual search.

So what does this mean for marketers? How does it change our jobs?

Here’s a summary on what developments in AI will bring for marketers, according to our four industry influencers, along with some suggestions on what you should do in face of these changes.

1. Increasing importance of SEO optimization for visual content

According to Sam Mallikarjunan, Head of Growth of HubSpot Labs, visual content will have an increasing influence on SEO

As Mallikarjunan says:

“…search engines are getting good at knowing what each video, audio clip, or image is actually about.”

Not only does Google favor YouTube videos in search results, they’re also getting better at analyzing what visual content is about. And this changes things for visual content creators. Just like how content writers had to learn to optimize headings and keywords, visual artists will have to start thinking about SEO when creating visual content like images and videos.

SEO for videos, for example, means optimizing keyword targeting, descriptions, tags, video length, and more.

2. More emphasis on content quality, relevance, and focus

Google’s RankBrain, is an artificial intelligence system which attempts to understand the context of content on websites and match that to relevant queries.

As Google gets better at analyzing search intent, it’s more important than ever to get your keyword research right, and then tie those keywords back into your content.

Basically, content has to do a better job than ever at serving searcher intent. So rather than older factors like keyword density, things like content relevance, context, and value are now more important ranking factors. That means providing real value, answering what people are asking, and not trying to stuff as many keywords as possible in a blog post.

It’s no longer about writing a blog post about one keyword phrase you picked from your keyword research. It’s about creating a blog, or a series of blog posts, around a concept related to that keyword. In fact, the best option would be to focus your website around a single topic. This way, you not only help RankBrain learn the niche you’re in, but also narrow your competitors’ pool, because Google will compare your websites only to others from your niche, so you’ll have higher chances of ranking and getting traffic.

3. A more selective approach to link building

Larry Kim, founder of Wordstream, predicts that websites with “strong domain authority with lots of links pointing to it but mediocre content” will be most susceptible to Google’s AI improvements.

Since the smarter search engines will analyze whether people clicking on your links actually stay and read your content, SEO marketers need to focus even more on relevance and quality in their backlinks.

We’ve covered content quality, but how do you improve link relevance? Basically, your backlinks should come from the same category and industry as your site – or similar ones. This means you’ll have to be more selective with your link building.

Basic example – if you sell cat food, and your website is all about cats and their food, then you shouldn’t have lots of backlinks from websites selling lizards. RankBrain won’t like it, and may penalize you for it.

In addition to restricting your content to a single niche, you also need to restrict your links to the same niche. Any fast and dirty ways to purchase links are surely out of the question. Going forward, we’ll have to build links the “old-school way” – by building real relationships.

Find influencers talking about your niche and connect with them to find link opportunities.

4. Going beyond web optimization only with mobile and voice search

If you’re only thinking about SEO for web browsing on computers, think again.

First, there are mobile searches.

According to a Google study, 40% of searches are now mobile, and more than one in four users only use a smartphone on an average day.

As a marketer, if you aren’t optimizing the way your brand is reaching customers on mobile, you risk missing out on a quarter of your potential audience.How Will AI Change SEO in 2017? [Video] | Social Media Today

Source: How People Use Their Devices – think with Google

Whether you’re ready or not, Google has put more pressure on us to make our sites more mobile friendly when they announced making it a part of their mobile algorithm.

A positive note of this mobile shift is it opens new doors for brands to market. For example, If you have a mobile app for your site, you can make it show in mobile queries to increase exposure and brand awareness. If you search for Wall Street Journal on your smartphone, you’ll find the WSJ app among the first few results, and it stands out against other ranking websites. Currently, it’s still a relatively untapped market, so act fast.

Then, there are voice searches.

With the rise of mobile usage comes voice searches; Siri, Google Now and Cortana are now present and ready to cater to all our capricious demands, and this changes things for SEO.

Most of us are more concise when we type – for example, you’d type “best pizza place NYC” into a search bar. But when you do a voice search, you’re more likely to say a complete sentence like, “Hey Siri, what’s the best place to get pizza in NYC?”

As Rand Fishkin notes:

“…voice searches are getting longer and more conversational.”

Founder and CMO of, Aleh Barysevich, suggests that we should “seriously incorporate voice search strategy into our websites because voice search optimization is the future of SEO.”

That means doubling down on great content in a conversational tone, and doing keyword research for conversational queries.

Kiss black hat techniques goodbye

In short, a smarter Google means black hat tactics are closer to becoming obsolete.

Short-term strategies that try to trick and outsmart algorithms won’t work – investing in long-term best practices will be rewarded more than gaming the system.

It may sound like a lot of work, but with improvements in AI, SEO should also become more intuitive and natural – so focus on delivering relevance and value to searchers, and let RankBrain work out the rest.

By Joei Chan