Thursday, May 2, 2013
The banks had their turn , its now ours
Only 140 Characters to Blow up Your Business LOOKS LIKE ITS TIME TO REALLY BE STARTING UP THE MESSAGE BOARDS WITH THE TRUTH. WE’RE HEARING it was one of the most dramatic scenes in the movie “Independence Day” when the White House exploded on screen after an attack by aliens. Of course, it wasn't real, but it had a real effect on the characters—and the audience. In fact, it was so real on screen that Jeff Goldblum had to save the world (which is a big leap up from having to survive a weekend with college buddies a la “The Big Chill”) while negotiating with Bill Pullman who played the role of the president (and more recently played a polygamist on HBO—I don’t know what’s harder, being the president or having multiple wives!). In any case, the explosion did create an audience reaction, a lot of discussion (wow, did you see that) and landed the movie on the list of top 40 highest grossing movies of all time. So, we saw the same thing happen last week when a hacked Twitter account spread the news (in only 140 characters) that terrorists had bombed the White House. This, too, was fiction and did not have the special effects of a Hollywood movie, just the purported headline of the disaster leaving the reader to their own conclusions. Of course, the White House did not fall to the ground, but the stock market sure did. In the financial markets, information is like ammunition. It can have a definite impact on the field of action, and you don’t always know if you are in the line of fire. For banks or mortgage companies, there is also the possibility that bad news can drive bad results. There is a lot of damage a disgruntled customer could make by airing their grievance through social media, and there is a lot of good that can be done from good messages, too. That is one of the reasons that our MortgageSAT product includes not just a measurement of customer satisfaction but also customer behavior, including whether the customer will recommend a lender and even whether the customer will discuss their experience on social media. Of course, the use of social media is now creating social media regulation. Earlier this year, the Federal Financial Institutions Examination Council came out with recommendations for banks relative to their use of social media. Once finalized, the FFIEC guidance is expected to be adopted by the agency members of the FFIEC, including the CFPB. The proposed guidance is far broader than existing regulations and it’s not just a list of rules around advertising and communication. Certainly, abandoning the use of social media is not a viable solution, as social media is becoming a standard medium for public communication. In our discussions with banks, I find that too many are pretending that their employees don't use the stuff. That's a dangerous position to take, and even worse since it’s obvious the customers are using it. Because more financial institutions are beginning to use social media for marketing purposes (and it can truly be a powerful weapon there), I'm having more conversations with mortgage companies and banks that are interested in using it right—and protecting themselves from the kind of problem that caused the panic last week. After all, when it comes to social medial, it does not have to be an intergalactic alien to reap destruction on your business. Garth Graham is a partner with Stratmor Group, and has over 25 years of mortgage experience, from Fortune 500 companies to startups, including management of two of the most successful mortgage e-commerce platforms. He was formerly with Chase Manhattan Mortgage and ABN Amro, where he was a senior executive during the sale of its mortgage group to Citigroup. SO LETS START WRITING PEOPLE USE TWITTER, LINKIN, FACEBOOK.. GET YOUR STORIES OUT THEIR!!