Social Media and Banking

5 Reasons Social Media Matters in Sales

2015-02-15T23:19:00.002-08:00

“Why are you all over social media?” That was the surprising question I was asked at a recent conference at which I spoke.

What surprised me was not so much the fact that someone questioned my extensive use of social media – many people have done that (mostly my wife!). The shock was that the person asking was involved in business development and sales.

If you follow me on LinkedIn or Twitter you know I am a fairly active on social media. Since the days of Compuserve and Egghead Software I have been an advocate for technology and the tools that create a competitive advantage in business.

Notwithstanding my obsession, anyone involved in business development – regardless of the industry - that has not included social media as part of their business development strategy, does not get it!

Research has shown that the use of social media has a significant positive effect on sales. Salespeople using social media experience 78% greater sales than similarly situated salespeople not using social media. With these numbers I cannot understand why salespeople would even think of balking at social media.

The following are five reasons why every salesperson and business development officer should implement a well-thought-out social media strategy.

1. Social Media is a Workhorse. Successful salespeople work long hours. Colin Powell has said “There are no secrets to success. It is the result of preparation, hard work, and learning from failure.”

A salesperson’s typical day begins with responding to emails, writing proposals, working prospect lists, making phone calls, attending mixers, presenting at conferences, driving for miles, flying for days, etc.

But no matter how driven and dedicated a salesperson may be, eventually there is a need to call it a day and recharge the batteries.

Unfortunately, business today is global and it crosses time zones. The Deal waits for no one – no matter how many hours per day a salesperson puts in. That’s where social media comes in. With social media, a salesperson can remain engaged and not skip a beat – even while sleeping in a different time zone or on a different continent.

Well-executed sales strategies make use of social media to create and maintain professional profiles that can provide needed information and convey knowledge, experience and competency. The use of a well-crafted social media profile accompanied by well-developed content, gives the prospective buyer the information needed to place the salesperson on the short list for follow up or to begin the sales process.

2. Social Media Validates. Years ago I heard someone say “the Internet is the new resume.” Then a couple years later I heard someone say “Google is the new resume.” Today, most will agree that social media (and LinkedIn, specifically) is the new resume.

In my experience, nearly every business development meeting is preceded by or followed by the prospect visiting LinkedIn to validate information. Savvy buyers know that LinkedIn houses the resumes, expertise and accolades of over 300 million professionals worldwide. With this many professionals in one place, LinkedIn is without question the new resume and worthy of inspection before inking a deal.

It is in every salesperson’s best interest to maintain not only a social media presence, but also a presence that projects the message the salesperson is attempting to convey. The social media profile must be impressive and appropriate. It must not only validate the salesperson – it must bring the prospect closer to closing the deal.

3. Buyers Are In Control. Sellers are no longer in control. Buyers tend to do their research before making a purchase, with the average consumer viewing more than 10 pieces of content prior to making a purchase.

This means that buyers no longer rely on the information provided by sellers. Whether the transaction is business-to-consumer or business-to-business, buyers are doing their homework by visiting social media sites and digesting available content to support the buying decision.

Salespeople must make themselves easy to find if they stand a chance at closing the deal. In the 1950s a bank robber named Willie Sutton was asked why he robbed so many banks. His answer: it’s where the money is! Today, salespeople must ask themselves a similar question. Why create a social media presence? It’s where the buyers are!

4. It’s a Sharing Economy. Savvy salespeople know the power of “going viral.” The Internet has turned ordinary entrepreneurs and salespeople into overnight success stories as a result of social media’s ability to easily and quickly share information. The ability to share information on social networks means that anyone with a little creativity and some luck can become the next millionaire or billionaire!

Social media’s success is built on its ability to share information. Visit any social media profile or view any video, photograph or other form of content on social media and you will see the buttons that encourage sharing of the information. Social networks encourage buyers and potential buyers to share information about the product or service.

Salespeople that make use of social media create the ability to turn prospective and actual buyers into advocates/evangelists for the product/service. Instead of being a sales force of one, salespeople can potentially activate hundreds, thousands and even millions of people in getting the word out.

5. Content is Not King. Many believe that content is king. I don’t. I believe that content is a king maker.

Social media makes salespeople accessible 24X7. Through well-crafted content found on Web sites and through social media, salespeople can create a trail of bread crumbs leading potential buyers straight to the seller.

Content is any information that can be housed on the Internet. This includes videos, podcasts, photos, articles, whitepapers and any other piece of information that can be retrieved by a potential buyer.

The power of content is its ability to inform and influence prospective buyers. Some prospects prefer videos to view the features of a product or service. Others prefer whitepapers containing technical specifications. Others prefer infographics that provide snapshots.

Each prospect has his/her own preferences. The key for any salesperson is to develop content in different formats that provide the information that prospects seek before making a purchasing decision. A salesperson that fails to create and maintain such content gives the advantage to competitors that incorporate content as part of their business development strategy.

Getting back to the opening question: why am I all over social media? Because it’s where the sales are. Ignoring social media gives the competition the advantage and turns potential buyers into the competition’s advocate – not mine. That's a pretty god reason to be on social media.

8 Steps to Protecting the Organization Against Social Media Risks

2014-04-30T09:56:00.005-07:00

According to Marc Gobé, in his book Emotional Branding, “the Web has fast-tracked careers, turned unknowns into celebrities, built and destroyed brands and reputations, and – against all odds – helped elect a black candidate President of the United States.”

This phenomenon has occurred as a result of achieving a tipping point in social media usage. While the exact date that social media became ubiquitous in American life is unknown, it is suggested that it occurred sometime between 2012 and 2013. According to the Pew Research Center in its December 2013 report, “Social Media Update 2013,” 73% of online adults used social media in one form or another. At that level of adoption it is difficult to argue that social media is merely a fad, pastime, or periodic diversion...[READ THE ENTIRE ARTICLE HERE]

Brand Ambassadors in the Age of Social Media

2014-04-07T18:45:00.001-07:00

Back in late 2007 I started to see the effect that social media was having on the sales and marketing landscape. While few banks and financial services companies had made the leap into social media, packaged goods companies were jumping in knee-deep.

As an entrepreneurial banker I was thrilled by the potential that social media could have on managing reputation, improving marketing effectiveness, and increasing sales. As a result, in January 2008, I released an e-book on the topic – “The Community Banker’s Guide to Social Network Marketing.” This was the first published work that addressed the use of social networks by banks.

PEOPLE DO BUSINESS WITH PEOPLE

Social media provides a cost-effective method for “spreading the word.” However, I have found that a recommendation made by a trusted source will always trump a targeted advertisement or viral meme. This of course is because People Do Business With People – not corporations, LLCs, partnerships, and definitely not videos or photos. Social media’s sales power does not come from its ability to serve up cheap targeted ads or funny cat videos.

Social media’s sales power comes from its ability to create peer-to-peer conversations – many of which include product recommendations from trusted sources, that result in sales. So long as the person making the recommendation is a trusted party ("influencer"), the recommendation will go a long way in steering the sale towards the recommended product or service. The challenge with social media is not "does it work." It does.

The challenge is finding ways to scale its sales capability. While business owners, CEOs, and other traditional influencers can actively participate in social media conversations through Facebook, Twitter, LinkedIn, and other platforms, their time is scarce and their networks are limited. What organizations seeking to leverage social media must do is find ways to scale the benefits of social media and increase the number of influencers. Enter Brand Ambassadors.

BRAND AMBASSADORS

Brand Ambassadors have been around for many years – and they are everywhere. Visit any industry convention, sporting event, concert, or street fair and you will see the Brand Ambassadors working the floor. They are the high-energy men and women handing out samples, answering questions, passing out bumper stickers, and taking pictures with passers-by, among other activities.

Brand Ambassadors are everywhere because they work. They take the multi-million dollar corporations and put a human face on them. They are the smile, handshake, helpful answer, and compliment consumers remember when they think of the brand. But the best part about Brand Ambassadors is that they are ordinary people. They are effective because People Do Business With People!

Every company has a cadre of Brand Ambassadors ready for deployment. This group of people is called employees! Traditional Brand Ambassadors are required to have knowledge of the company history, its products, its culture, and its values. These are exactly the same things that employees already know – and live – each day.

Organizations seeking to scale the benefits of social media must create a framework that treats every employee as a Brand Ambassador. Organizations should invest the necessary time and money to train and unleash their armies of influencers. With institutional knowledge in one hand and social media skills in the other, employees can act as the greatest form of Brand Ambassador.

EMPLOYEE = BRAND AMBASSADOR = INFLUENCER = BRAND EVANGELIST

Similar to the old school Brand Ambassadors working a convention floor, today’s social media-enabled Brand Ambassadors also represent the organization to the outside world. Today, social media has enabled Brand Ambassadors to use tools such as social networks, blogs, and other forms of social media to conduct their influencing activities.

Instead of relying solely on senior members of the organization to influence the marketplace through press releases, media interviews and other appearances, organizations can empower employees to go out and evangelize on behalf of the organization. Another important consideration is that the general public trusts its peers much more than it does a company CEO or other high-ranking company official. This makes employees much more influential than the high paid CEO.

According to Tom Blackett in Brands and Branding (Bloomberg Press, 2009), “when employees are excited by the proposition they will help to sustain it and communicate it to customers, suppliers and others through their enthusiasm and commitment.” Therefore, to the extent that an organization can properly motivate its employees to act as Brand Ambassadors, employees can become an incredibly effective tool for influencing stakeholders. The maintenance of a strong cadre of Brand Ambassadors will result in a stronger brand, improved customer satisfaction, increased revenue, and strong financial results.

According to blogger Mike Bailey ("Beyond Engagement: Unleashing the Power of Employee Advocacy"), “on average, when employees share something with their social networks, each one reaches 20 times more people than a typical brand sharing with the same number of followers.” This makes employee Brand Ambassadors not only a good idea, but a profitable idea.

CHIEF BRAND AMBASSADOR

An effective social media-enabled Brand Ambassador Program requires a champion at the highest level of the organization. Effective Brand Ambassador programs that rely on the organization’s employees must have the owner, CEO, or some other top ranking individual act as the CBA, or Chief Brand Ambassador.

The Chief Brand Ambassador must ensure that the organization gives more than just lip service to the Brand Ambassador Program. The Chief Brand Ambassador must invest appropriate resources into the program, expect results from the program, hold people accountable for results, integrate the program into the organization’s overall sales and marketing strategy, and acknowledge the program as vital to the success of the organization. The Chief Brand Ambassador must believe that social media combined with employee ambassadors can create an intangible asset that can produce very tangible results.

In order for the social media-enabled Brand Ambassador Program to succeed the organization’s leaders must believe in the power of social media. An organization that treats social media as a fad or a waste of time will have a difficult time convincing employees of its power to influence and will not achieve success.

DIRECTING THE EFFORT

Once the decision is made to commit to a social media-enabled Brand Ambassador Program the organization will need someone to care for and manage the program. The Chief Brand Ambassador must select an individual that has a genuine appreciation for the power of social media. The Director of the Brand Ambassador Program must be well versed in the potential risks and rewards that come with empowering the workforce through social media.

A common mistake made by many organizations is to place social media in the hands of low-level employees - or interns! Social media efforts should be managed by experienced personnel with a great deal of institutional knowledge. Since the Director will manage the types of content to be shared, a strong understanding of the organization is critical. Further, due to the potential risks involved the Director should possess a level of maturity, experience, and knowledge to protect the organization from reputational and compliance issues.

A Brand Ambassador Program will empower and unleash employees in the social media universe by training, inspiring, and encouraging them to utilize social media to "spread the word." Depending on the organization’s social media strategy, these employees may use personal social media accounts, organizational social media accounts, or both, to conduct their activities.

Before unleashing Brand Ambassadors organizations must ensure that employees are well trained, understand their role, and recognize that their actions may have both a positive and negative effect on the organization, and ultimately, the organization’s success.

The Director must work with internal stakeholders to develop content that can be easily shared by Brand Ambassadors. Content can take the form of text, photos, video, audio, or another form of communication. The Director must also work with internal stakeholders to share best practices relative to content development and distribution. In addition, the Director must ensure that content is monitored and results are reported to senior management and the board of directors.

MANAGING THE DOWNSIDE

Brand Ambassador success requires that employees commit to the organization’s code of conduct (e.g., respectful tone, free of profanity, etc.) whenever they interact on a social media platform. Employee Brand Ambassadors must understand that the actions they take on social media platforms may be attributed not only to them, but also the organization. Therefore, whether on or off the clock, employees must be aware of the effect that their interactions on social media platforms can have on the organization. It is the Brand Ambassador Program Director's job to manage these risks to a level commensurate with the organization's risk appetite. In other words, risk should be managed to the point of letting management and staff sleep at night.

Blogger Linda Tucci describes in the TotalCIO blog at TechTarget.com (“Social Media Risks That Will Make Your Hair Stand on End”) an embarrassing instance involving an executive at a public relations firm. The seasoned public relations executive was flying to meet with a major client. Upon flying to and arriving at the client’s hometown, the public relations executive tweeted that the client’s hometown was one of those places where he would rather die than have to live in. An employee of the client’s firm read the tweet and passed it on to senior officials at the client firm. To say that the public relations executive had some explaining to do is an understatement. The embarrassment caused to the public relations firm by its executive was further exacerbated by the fact that the public relations executive was meeting with the client to pitch, of all things, social media communications!

The public relations executive story noted above is an example of a major concern with social media. As more and more employees use social media for personal reasons, more and more of the employees’ personal conversations will inadvertently spillover into the employees’ professional lives.

Consider an employee that posts an inappropriate (from the organization’s point of view) comment on a LinkedIn group. The comment could be directly attributed to the organization based on information contained on the employee’s LinkedIn profile. Or consider an employee that posts an inappropriate photo on Flickr while in a company uniform.

The point is that even if the organization restricts employee use of social media at work or even if the organization chooses to not to participate in social media altogether, there is still potential risk arising from the activities of employees while on their own time. These employee activities may create uncomfortable, damaging and even legal liability for the organization. Employees should understand that they are all “Brand Ambassadors” and that being a “Brand Ambassador” means acting and responding in an appropriate manner. Anything less may result in significant damage to the organization.

Risk management is an important element of any initiative that involves social media use. Many incorrectly believe that risks associated with social media usage are technology risks that can be addressed through technological solutions. This is not the case. Social media risks are people risks. Organizations may be able to control employee access to social media platforms on the company network. However, organizations have no ability to enforce such restrictions on employee-owned and other devices. A comprehensive view of these "people risks" can be found in The Human Resources Guide to Social Media Risks.

A MATTER OF POLICY

While every organization would like to believe that its employees are smart, capable and masters of common sense, every employee has the potential to “blow it” every now and then. As such, every organization must address employee use of social media through a formal, written social media policy. This requirement applies whether or not employees are communicating on social media in an “official” capacity or on their own time.

The social media policy should provide guidance to employees regarding the topics that are open for discussion. Organizations operating in largely unregulated environments can provide simple guidance such as requesting that employees use common sense. Organizations that operate in tightly regulated industries (e.g., securities, banking, healthcare, etc.) should, at a minimum, provide topics that are off-limits due to regulatory restrictions. These topics can include legal matters (potential or current litigation), financial information (e.g., earnings results/expectations, etc.), and other topics specific to each regulated industry.

The complexity and comprehensiveness of the policy should be commensurate with the risks. For example, a small, single location organization where information flows continuously and oversight is abundant may require a less complex policy statement than a company with a geographically diverse workforce.

Organizations may include in the social media policy a requirement that states that employees keep the organization’s logo and other protected intellectual property off of the employees’ personal social network pages, blogs, profiles, etc. The organization may also prohibit employees from using the organization’s e-mail address when registering for personal-use social media sites. With respect to employees that maintain personal blogs, the organization should require that employees include a disclaimer that the views expressed on the blog are those of the employee and not of the organization.

RULES OF THE ROAD

Social media is built upon the concepts of honesty and transparency. The social media community is not very forgiving when it comes to companies and employees that share information that is intentionally misleading or altogether fraudulent. While inadvertently incorrect information can be forgiven, it is best to have employees interact honestly and with complete information or not at all. In addition to the issues of honesty and transparency is the issue of protocol. Paul Gillin, in his book The New Influencers (Quill Driver Books, 2009), states that the social media community “is developing into an extraordinarily civil and deferential culture.” As such, rude and uncivilized behavior is also not tolerated and can reflect poorly on the organization.

While companies should encourage civility, honesty and transparency when interacting on social media platforms, certain information should be off-limits and not disclosed by employees. This information includes confidential company and customer information, information related to legal disputes and other sensitive information. The release of this type of information should be reserved for senior management.

BREAK IN CASE OF EMERGENCY

Organizations should have an incident response process in place to deal with employee social media content (comments, video, photos, etc.) that create a need for action. Further, the social media policy should enable the organization to demand that employees remove any damaging comments. The policy should state that compliance with this requirement is a condition of employment. Further, employees should understand that noncompliance with the social media policy may result in disciplinary action, up to and including termination.

MAKING THE MOST OF A PRECIOUS RESOURCE

Employees are every organization’s most trusted ally. Through social media, organizations are able to unleash them in a manner that transforms employees into advocates for the organization, evangelizing through their social networks on behalf of the organization. In the 1980’s there was a Faberge Shampoo commercial that spoke of users of the shampoo telling two friends and those friends telling two friends, and so on and so on. Fast forward 20 years. Now imagine an organization’s employees telling their friends, and their friends telling their friends and so on and so on. With proper policies, training, and oversight, the use of employees as Brand Ambassadors can go a long way in maximizing the organization’s brand.

DOWNLOAD THE WHITEPAPER!

If you have questions about managing social media risk in the workplace contact Social Risk Services at Info@SocialRiskServices.com.

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Social Media Risk Boot Camp for Financial Institutions

2014-03-30T18:41:00.002-07:00

CHECK OUT THIS BOOT CAMP BY SOCIAL RISK SERVICES

Social Media Risk Boot Camp for Financial Institutions

Agenda and Registration Information

Friday, May 16, 2014

8:00 am - 4:30 pm

Torrance Marriott South Bay

$175 Per Person (includes lunch)

PAYMENT INFORMATION AT BOTTOM OF PAGE

Social Risk Services will host a Social Media Risk Boot Camp for Financial Institutions in Los Angeles on May 16, 2014 at the beautiful Torrance Marriott South Bay. Space is limited! Early registration is encouraged. Continue reading for agenda and registration information.

Social media influence continues to grow. Contrary to earlier opinions by many in the financial services industry, social media is not a fad. Every year more and more financial institutions commit to social media in one form or another. However, many financial institutions do not adequately consider the legal, compliance, operational, and reputational risks, among others.

The Social Media Risk Boot Camp for Financial Institutions will provide attendees with the tools needed to prevent associated risks. This Boot Camp will provide a primer on social media use by organizations and employees, risk assessment methodologies, internal control designs, policy and procedure tools, and training tools.

Financial institutions use social media in many ways including: advertising, marketing and promotions; new loan and deposit account origination; customer surveys; customer service; and, community outreach. This form of customer interaction tends to be less formal and less controlled than traditional bank methods. It also tends to be more democratized (not top-down but peer-to-peer). As such, it presents unique challenges to financial institutions relative to their risk management practices.

On December 11, 2013, the FFIEC issued its Final Guidance on Social Media. To meet regulator expectations, financial institutions are expected to manage potential risks associated with social media usage and access. The Final Guidance is intended to bring forth the compliance, legal, reputational, and operational risks associated with social media usage.

The Social Media Risk Boot Camp for Financial Institutions will provide attendees with the tools needed to comply with the Final Guidance. Tools include conducting risk assessments, designing internal controls, developing management reports, creating policies and procedures, and providing effective employee training.

TOPICS COVERED

Introduction to Social Media Use Among Financial Institutions
Analysis of the FFIEC Final Guidance on Social Media
Preparation of Social Media Risk Assessment
Creation of a Social Media Policy and Procedures
Development of a Social Media Training Program for Employees and Directors

RECOMMENDED AUDIENCE

This informative session is best suited for Chief Operation Officers, Chief Executive Officers, Chief Risk Officers, Social Media Personnel, Marketing, Chief Information Officers, Chief Technology Officer, Information Security Officers, Chief Auditors, Chief Compliance Officers, Operations Officers, Board of Directors, Information Technology Personnel, anyone responsible for audit.

ATTENDEES RECEIVE A CERTIFICATE OF COMPLETION

Each Boot Camp attendee receives a Certificate of Completion showing completion of the program. The Social Media Risk Boot Camp provides six hours of instruction. Attendees are encouraged to maintain a copy of the certificate in their employee training file to document their participation and completion of the training program.

SPEAKER

The Social Media Risk Boot Camp for Financial Institutions will be led by Jesse Torres. Mr. Torres is a career banker with over 20 years of leadership experience. Mr. Torres wrote the first book on social media and banking in January 2008 (Community Banker's Guide to Social Network Marketing). Mr. Torres has subsequently written other social media-related books, including his most recent book, The Human Resources Guide to Social Media Risks. Mr. Torres is not only an engaging speaker, he also brings with him experience as a former OCC bank examiner, KPMG consultant, and banker.

QUESTIONS?

Visit the event Web site here. Direct any questions to Info@SocialRiskServices.com.

CLICK 'PAY NOW" TO REGISTER SOCIAL MEDIA RISK BOOT CAMP FOR FINANCIAL INSTITUTIONS

Go All In? Not Until You're Ready

2013-08-04T19:35:00.001-07:00

In her recent article, "7 Things Banks & Credit Unions Don't Do In Social Channels (But Should)," Julia Verbrugge, Marketing Coordinator at Andera, makes some good recommendations for bankers and credit unioners.

Julia's "seven things" are:

Go All-In
Get That Strategy Ironed Out
Don't Just Inform...Entertain
Build Your Community Through Personal Interactions
Resolve Customer Issues Publicly
Get Creative
Monitor and Measure

As a banking social media veteran (all of five years!) I agree with Julia with one caveat...Don't go All-In until you know what you're doing.

Julia makes a great point by stating that dabbling in social media will not produce meaningful results. It's true, the occasional tweet or status update will not gain favor with very many people. Julia reminds us that an effective social media program requires a dedicated effort with the commitment of human and financial resources.

While she's right, "no pain, no gain," Julia's article does not touch on the need to know what you are doing before going all-in. With the FFIEC drawing attention to social media and regulators carefully scrutinizing social media implementations, organizations need to be prepared before going all-in. As with poker, going all-in requires that the institution be cautious as one wrong move can cost you everything on the table. In the case of social media this means regulatory, legal and customer issues.

So while I agree that real results will only come once an institution fully commits to social media, I also believe that each institution must take a path of testing and learning before pushing forward all the chips. What do you think?

Quick and Dirty (and Effective) Social Media Training Tool

2013-03-09T11:12:00.001-08:00

ATTENTION BANKS USING SOCIAL MEDIA! The day you have been fearing is here!

With the recent release of draft guidance by the FFIEC regarding social media use, social media is now front and center.

Conversations with auditors and examiners is revealing an interesting audit and regulatory expectation - mandatory social media training for all employees and directors.

As social media matures and more and more senior managers and directors feel comfortable with the use of social media, auditors and regulators have begun to look more closely at social media use by organizations. Unfortunately, there still exists in many cases a lack of understanding on the part of internal auditors and examiners in terms of what exactly what and how social media works. This ALWAYS spells trouble for bankers.

As we move forward as an industry in terms of social media adoption financial institutions must focus on three primary areas:

Social Media Risk Assessment
Social Media Policy
Social Media Training

Social Media Risk Assessment

I have previously covered and provided social media risk assessment tools. See my post "Social Media Risk Assessment Process - Part 5." This is one of the most visited posts - with good reason, auditors and regulators expect institutions to conduct a risk assessment before deploying social media.

Social Media Policy

I have also previously covered and provided a sample social media policy. See my post "Sample Social Media Policy for Banks." This is another one of my most visited posts. Even institutions that do not use social media are being required in some cases to have a policy confirming that fact!

Social Media Training

The final piece of the trifecta is Social Media Training. Due to the widespread use of social media within society, auditors and regulators are now treating social media like they do areas such as information security and the Bank Secrecy Act. Increasingly auditors and regulators want to see social media training for all new employees. The thinking is that social media can do some real damage if employees are not aware of the risks. As such, just like information security and money laundering, social media is equally risky. In addition to new employee training, there is an increasing expectation of annual training and director training. All this is new and sudden and many organizations have not been prepared.

In an effort to assist the banking industry, Pan American Bank made available on its YouTube channel a 30 minute social media training video. Pan American Bank does not guarantee that the video will meet auditor or regulator requirements but it is a good starting point for those that need to quickly ramp up their employee and director training relative to social media use.

Check out the video and make use of it for training if it meets your needs. And good luck with your upcoming audits and examinations!

Sample Social Media Policy for Banks

2012-08-19T00:57:00.001-07:00

A frequent request is a sample Bank Social Media Policy. Well here it is. This sample policy is bare bones and is intended to be customized for each institution's specific social media strategy.

Enjoy.

BANK SOCIAL MEDIA POLICY

Bank recognizes the importance of the Internet in the day-to-day operations of the Bank. From marketing to reputation management to recruitment of new employees, the Internet plays in major role in the Bank’s overall strategy. And now, the Internet is generally synonymous with social media and its popular social networks such as Facebook and LinkedIn. Use of Facebook, LinkedIn, blogging, wikis and other online social media vehicles are commonplace.

This policy is intended to assist employees in making appropriate decisions about work-related blogging social media interaction. This policy must be used in conjunction with other tools provided to employees, including the Acceptable Use Policy, Employee Guide to Information Security, Human Resources Guide to Social Media Risks, and related training.

The lines between work and personal life can become blurred. In general, what you do on your own time is a personal decision. However, activities in or outside of work that affect your job performance, the performance of others, or Bank business interests are a proper focus for Bank policy.

WHAT THE BANK EXPECTS TO GAIN FROM SOCIAL MEDIA

As a community bank, Bank recognizes the importance of our employees joining in and helping to shape conversations regarding the Bank and the communities we serve. Bank is committed to supporting employees desire to interact knowledgeably and socially on the Internet through social media.

Contributing to the online conversations about banking or our communities means being present where and when they are taking place. As technology tools enable an easy exchange with community members, governmental representatives, clients, and the public, we encourage employees to share the insights and expertise gained through work at Bank. This can be done without first asking permission provided this guidance is read and followed.

“TARGET” OF THE BANK’S SOCIAL MEDIA EFFORTS

The Bank’s social media efforts are targeted at several stakeholders:

1. Existing Customers: To provide existing customers with information and conversation/engagement opportunities relative to ongoing activities at the Bank and in the community. Ultimately, the goal is to convert a “customer” into an “evangelist” for the Bank.

2. New Customers: To create sufficient awareness in the local marketplace that results in new customer originations – deposit, lending, and other services. The marketplace is full of competitors with similar “commodity” products and services. Social media allows the Bank to “humanize” itself and set itself apart from the competition.

3. Media: Social media provides the Bank with a platform to communicate with the media regarding its ongoing activities and rich history. Through social media the Bank can embed video and other media that can assist the media when developing content. For example, a bank video can be reposted and potentially result in viral distribution.

4. Regulatory Agencies: Social media provides a channel through which the Bank can highlight compliance with regulatory requirements. For example, social media allows the Bank to easily demonstrate its compliance with the Community Reinvestment Act. Further, social media provides a convenient mechanism through which to receive consumer complaints or positive feedback.

5. Community At-Large: Social media introduces Bank to the community at-large. The content created on social media provides an information distribution channel through which interested parties can learn about Bank.

EMPLOYEE ACCOUNTABILITY

Being able to share your and the Bank’s activities without prior management approval means the Bank trusts you to understand that by doing so you are accepting a higher level of risk for greater rewards. Each Bank employee is personally responsible for the content he or she publishes on any form of social media. Be thoughtful about how you present yourself in online social networks.

You may have identified yourself as a Bank staff member or the Bank as your employer, either directly or as part of a user profile. If so, ensure your profile and related content is consistent with how you wish to present yourself to the Bank’s stakeholders, your business contacts, and your colleagues and peers.

Senior management have special responsibility with their Internet presence by virtue of their high profile position within the Bank, even if they do not explicitly identify themselves as being affiliated with the Bank. Such senior level staff should assume that his or her posts will be seen and read by Bank stakeholders and that they will presumptively associate such posts with the Bank.

Trust is an essential ingredient in the constructive culture we are striving to achieve at the Bank. We can’t be there to guide every interaction, so we expect you to follow these guidelines and advice to help you better balance the risk vs. reward ratio.

SOCIAL MEDIA OVERSIGHT

The Social Media Manager is responsible for managing the Bank’s social media strategy. The Social Media Manager, or an assignee, will provide training and monitor activity on an ongoing basis. Inquiries regarding the Bank’s social media strategy must be forwarded to the Bank’s Social Media Manager.

The Social Media Manager is responsible for determining “community managers.” Community managers are employees and third parties that are provided with authority to act as administrators on the Bank’s behalf. The Social Media Manager must select individuals as community managers that possess the requisite technical skills as well as understand the risks associated with social media. All community managers report directly to the Social Media Manager relative to matters related to social media – regardless of their role within the Bank.

GENERAL GUIDELINES

These guidelines will help you open up a respectful, knowledgeable interaction with people on the Internet. They also protect the privacy, confidentiality, and interests of the Bank and its customers. Note that these policies and guidelines apply only to work-related sites and issues and are not meant to infringe upon your personal interaction or commentary online. Regardless, all employees must determine the potential impact that “personal” interactions may have upon the Bank and its customers, vendors, and other stakeholders. Ultimately, employees are held accountable for ensuring that interaction is appropriate and consistent with this policy and other Bank guidance.

· The goal is to ensure the Bank’s voice is part of the larger conversation relating to community banking and the communities the Bank serves. Do not embark before understanding the conversation. First, explore the topic being discussed, read about it and contribute only when input adds or advances the discussion. Include an especially relevant link, since doing so further connects the Bank to the wider Web and can result in greater connectivity for the Bank.

· Keep in mind that posts are visible by all with online access. It may be fine to share your work at the Bank as part of your participation in the online community, etc., but you DO NOT have permission to reveal any information that compromises Bank policy or public positions. By that we mean don’t share anything that is proprietary and/or confidential to the Bank. For example, it is not okay to share any content that required a non-disclosure agreement or is part of a confidential management or Board discussion. Other items that may not be disclosed include any customer and vendor information that is not publicly available.

· If you are developing a Web site or writing a blog or making any other social media comment that will mention Bank and/or our current and potential products, employees, partners, customers, and competitors, identify that you are an employee of Bank and that the views expressed on the blog or Web site are yours alone and do not represent the views of Bank.

· Unless given permission by your manager, you are not authorized to speak on behalf of the Bank, nor to represent that you do so.

· If you are developing a site or writing a blog or making any other social media comment that will mention our company and / or our current and potential products, employees, partners, customers, and competitors, as a courtesy to the company, please let your manager know that you are writing them. Your manager may choose to visit from time to time to understand your point of view.

· You may not share information that is confidential and proprietary about the Bank or its customers. This includes information about upcoming product releases, sales, finances, number of products sold, number of employees, Bank strategy, and any other information that has not been publicly released by the company. These are given as examples only and do not cover the range of what the Bank considers confidential and proprietary. If you have any question about whether information has been released publicly or doubts of any kind, speak with your manager before releasing information that could potentially harm the Bank, or our current and potential products, employees, partners, and customers. Before embarking on any such endeavor employees should be familiar with the Bank’s other applicable policies, including the Acceptable Use Policy, Employee Guide to Information Security, etc.

· Bank logo and trademarks may not be used without explicit permission in writing from the Bank. This is to prevent the appearance that you speak for or represent the company officially.

· Speak respectfully about the Bank and our current and potential employees, customers, partners, and competitors. Do not engage in name calling or behavior that will reflect negatively on the Bank's reputation. Note that the use of copyrighted materials, unfounded or derogatory statements, or misrepresentation is not viewed favorably by the Bank and can result in disciplinary action up to and including employment termination.

· The Bank encourages you to write knowledgeably, accurately, and using appropriate professionalism. Despite disclaimers, your Web interaction can result in members of the public forming opinions about the Bank and its employees, partners, and products.

· Honor the privacy rights of our current employees by seeking their permission before writing about or displaying internal company happenings that might be considered to be a breach of their privacy and confidentiality.

· You may not sell any product or service that would compete with any of the Bank's products or services without permission in writing from the Chief Administrative Officer. This includes, but is not limited to training, books, products, and freelance writing. If in doubt, talk with your manager or the Chief Administrative Officer.

· Recognize that you are legally liable for anything you write or present online. Employees can be disciplined by the Bank for commentary, content, or images that are defamatory, pornographic, proprietary, harassing, libelous, or that can create a hostile work environment. You can also be sued by Bank employees, competitors, and any individual or company that views your commentary, content, or images as defamatory, pornographic, proprietary, harassing, libelous or creating a hostile work environment.

· Media contacts about the Bank and our current and potential products, employees, partners, customers, and competitors should be referred for coordination and guidance to the Chief Administrative Officer. This does not specifically include your opinions, writing, and interviews on topics aside from the Bank and our current and potential products, employees, partners, customers, and competitors.

· Make sure that your online activities do not interfere with your job performance.

· Respecting differences, appreciating the diversity of opinions and speaking or conducting yourself in a professional manner is expected at all times. If you aren’t completely confident about what you intend to share, you should seek management input before you post.

HOW WILL SOCIAL MEDIA BE IMPLEMENTED AT THE BANK

The Social Media Manager of the Bank is accountable for determining the Bank’s Social Media Strategy. The Bank’s use of social media is largely to develop a “community” of Bank supporters and to raise awareness of the Bank’s brand. This is largely done through interaction on mainstream social media platforms such as Facebook, LinkedIn, Blogger, and Twitter. The specific platforms used may change from time to time as technology evolves and audiences shift. Regardless, the guidelines above remain in effect. Questions regarding the Bank’s use of social media should be directed to the Social Media Manager.

TYPES OF BANK ACTIVITIES/POSTINGS

The primary purpose of the Bank’s social media activities is “community building.” While the Bank will from time-to-time promote products and services, the primary focus is the creation of an online community where the Bank can share its history and mission and where stakeholders can maintain conversations with the Bank. The Bank does not “censor” comments made by third parties and only removes comments if they are considered obscene, pornographic or similarly inappropriate. As such, it is the Bank’s policy to remain transparent and not delete derogatory comments. Instead, it is the Bank’s policy to attempt to understand the origin of any derogatory comment in an attempt to “correct” any error or misunderstanding caused by the Bank. Management is responsible for monitoring content on an ongoing basis (generally daily).

The Social Media Manager is responsible for determining “community managers” given authority to post on behalf of the Bank. The Social Media Manager is responsible for ensuring that such employees are “social media savvy” and understand social media risks.

TYPES OF SOCIAL MEDIA USED BY BANK

Currently the Bank utilizes Facebook, Youtube, Blogger, LinkedIn, and Twitter. These platforms provide for varying types of interaction. Some are more information based such as LinkedIn. Others are more collaborative, such as Facebook. Currently the Social Media Manager is responsible for managing these accounts.

OTHER FORMS OF SOCIAL MEDIA

Regardless of any organization’s use of social media, Internet users can make comments that affect the Bank on locations outside of the Bank’s social media sites. As such, the Bank utilizes Google Alerts and SocialMention.com to monitor (listen) to conversations in social media and on Web sites that may affect the Bank. Such reports are delivered directly to the Social Media Manager on an ongoing basis. The Social Media Manager is responsible for determining appropriate action, if any.

TRAINING

On at least an annual basis the Bank will provide social media training to all personnel. The training is intended to convert employees into social media evangelists while ensuring safe and sound use of social media. Compliance with the guidelines noted above will largely ensure that employees act in a manner consistent with Bank expectations.

AUDIT

The Bank’s social media activities will be audited as part of the Bank’s normal internal audit schedule. Auditors will audit as appropriate. For example, audits related to IT, consumer compliance, fair lending and CRA may all contain a social media component.

Community Outreach and Retail Banking

2012-08-14T10:07:00.000-07:00

According to a recent article written by Alan Mattei of consultancy Novantas LLC, community outreach is fundamental to retail banking. The problem banks face is determining how to best respond to the plethora of social platforms that include blogs, Facebook, Twitter, Pinterest, etc.

Mr. Mattei argues that social networking is forcing banks to think twice about the singular importance of branch banking. As more time is spent online, shopping habits, including those related to bank products and services, have morphed and as such, banks must find ways to meet with customers at their new destinations – social media platforms.

As evidence of this transition, Mattei provides examples of two branchless financial services players that have begun to market products and services through social platforms: Ally Bank and American Express.

Ally’s online outreach includes a blog with self-help tips and expert advice; a continuing heavy stream of articles that are broadcast and posted on its Website; posts on Facebook; tweets; and infographics. Such activities have generated millions of Website visits and have become a driver in deposit account origination, according to Forresteor Research.

American Express launched its “Sync, Tweet, Save” program, which entices customers to sync their cards with their Twitter accounts. Under this arrangement, promotions from merchants and American Express are pushed to the customer via Twitter, with discount offers concurrently activated at the merchant point of sale.

Mattei states that today’s innovators in the use of social media are going beyond traditional banking’s defensive measures (e.g., reputation management). Regardless, Mattei makes a point for walking before running by stating that “as a reasonable first step, institutions within the top 100 should establish an individual set of surveillance routines and contingency response plans for social media. This includes participating in conversational threads as appropriate; responding to customer service requests; diffusing negative events; and generally monitoring “the voice of the customer.” Much of this preparation remains to be done, although there are a few standout examples of banks with strong antennas in the virtual space.” Here Mr. Mattei is spot on. Mr. Mattei’s only error is that he has limited his advice to the top 100 when in fact every institution should follow this advice.

Mr. Mattei argues that social media and banking is about proactive involvement. He argues that banks must learn to “proactively participate in the online dialogue, not just react in trying circumstances.” The ultimate goal accord to Mattei is strengthening brand presence and building product awareness through:

Community Building
Two-Way Conversations
Content Threads

Mattei states that banks must begin incorporating social media into the overall marketing plan – despite the lack of maturity in the market. Just like the online marketing scene created chaos for bankers yet bankers adapted, so too must bankers adapt to social media despite the chaos. Mattei states that “institutions will have to start somewhere, just as they did when the Internet took off ten to fifteen years ago.”

Mattei attacks the ROI question head on when he states that “it is a mistake to begin using strict return on investment (ROI) calculations to evaluate social media initiatives right now.” He compares today’s social ROI debate to that of online billpay of yesterday. He points out that what years ago was a horrible ROI example, today has been an incredibly profitable service that creates serious retention.

For a second time in the article Mattei makes reference to the “majors” by stating that “for major banks, real traction with social media will require a dedicated team.” While the advice he gives is sound, it applies to all banks. Regardless, depending on the success and the leverage of social media within an organization, even smaller shops may want to consider community managers to run the day-to-day social operation. Should they be outsiders or bank employees? That is a conversation (debate) for another day.

Mattei goes on to address the use of social media for customer service. He advises to start small and simple and figure out what works and what doesn’t. He suggests using analytics to find the nuggets of gold that may result in an effective social effort.

Ultimately, Mattei states that “to mobilize for this new channel, executives must embrace the notion that building ‘social equity’ has long-term value for the institution. They then need to allocate the required resources, build the right teams, and craft a long-term strategy for transformation.”

I generally agree with Mattei. I wish his focus would not have been so heavily slanted towards larger shops. It is, after all, community banks that are best positioned to take advantage of the social media revolution. Understandably, community banks are not likely going to spend the bucks on social like the top 100. Regardless, it does not help the industry when the smaller players are ignored or left out of the "conversation."

Some useful links: Social Media Risk Assessment Template

Harnessing the Power of Social Media

2012-07-19T01:12:00.000-07:00

In his article, "How Banks Can Harness the Power of Social Media," Tom Bukacek, CEO of Black Box Social Media LLC summarizes nicely the best way community banks should use social media.

According to Bukacek, banks have been slow to adopt social media in recent years due to factors such as ROI, risks and understanding how to best use social networks. But this is changing every day.

Bukacek makes a strong point: "CONSUMER INTERACTION CAN ONLY OCCUR AT THE SMALLER COMMUNITY LEVEL."

BINGO!!!!!!

Bukacek goes on to explain that the "sharing of experiences and stories brings the banks closer to customers and also ends up becoming a valuable source of information about consumer preferences." He also addresses the issue of "negative feedback" by stating that a well handled social media crisis can result in a very positive outcome.

These are all simple but important rules when using social media in a community bank setting. Forget the big and expensive national campaigns of the multinational banks. Instead focus on micro-marketing through social media. Win over new customers and turn existing customers into brand ambassadors and evangelists for your brand.

Social Media Policies Everywhere in Among Investment Advisors

2012-07-18T01:25:00.001-07:00

The Investment Adviser Association, ACA Compliance Group and Old Mutual Asset Management released the 2012 Investment Management Compliance Testing Survey Report. The report found that among the investment advisers surveyed:

80% maintained formal written social media policies in 2012
64% maintained formal written social media policies in 2011
43% maintained formal written social media policies in 2012

The survey also found that in 2012, 54% of investment advisers prohibit personal social media sites such as Facebook to be used for business purposes. Further, in 2012, 54% of investment adviser firms audit for compliance with social media policies.

This data suggests that the regulated financial services industries have realized the ubiquity of social media - not only in the personal lives of employees and clients, but in the financial services industries.

With so few investment advisers maintaining formal written social media policies, the regulatory expectation, AKA Best Practice, will be for every regulated firm to not only maintain such policies but also test for compliance with the policies.

Complying with the HR Component

2012-03-01T16:03:00.001-08:00

At the risk of being called a shameless plugger, I am referring you to my recent book, "Human Resources Guide to Social Media Risks" as a tool for complying with the human resources related threats found on yesterday's Social Media Risk Assessment.

I think that the book is a necessary read for not only HR professionals, but any manager and employee in and around social media (e.g., everyone). There are some very important lessons in the book that can really help organizations manage their social media risks from an HR perspective. As I like to say, social media risks are human risks. They are not technology risks. A review of the risk assessment document in yesterday's post makes that very apparent. As such, be sure to pick up a copy of the guide. I think you'll be very happy you did and I really do believe that you will be doing your organization a great service.

Social Media Risk Assessment Process - Part 5

2012-03-01T00:22:00.000-08:00

Ahhhh. The fifth and final part of this series on the Social Media Risk Assessment Process ("SMRAP"). I hope you've enjoyed the series up to this point. I know I've enjoyed bringing it to you.

This last segment is all about completing the SMRAP. I've created a fairly basic yet effective social media risk assessment model. As you will note from the graphic below, my model uses the concept of "Threat/Vulnerability" pairs to isolate weaknesses that can result in disaster. In a nutshell, here's the deal: there are threats and there are vulnerabilities.

Threats are actions or events that can cause harm to the organization. For example, when it comes to social media risks, an example of a threat is the disclosure of confidential customer information over social media.

Vulnerabilities are simply weaknesses in the system. They are the chinks in the armor. Vulnerabilities are what enable the threats to take form. For example, a vulnerability related to the threat above could be a lack of understanding of social media-related information security risks by employees.

Therefore, using the same threat example above, a way for the threat to manifest or occur can be due to a lack of adequate employee training. In other words, an employee does not know that it is a bad idea to post confidential employee information on social media sites and as such, the employee post information or takes part in conversations that reveal confidential customer information.

This is what I refer to as the Threat/Vulnerability pair. A threat creates havoc and a vulnerability permits the threat to wreak havoc. It must be noted that threats in of themselves are fairly harmless. Without a vulnerability threats have no life.

STEP 1: Determine the threats that apply to the organization's social media environment. I have created a social media risk assessment template that contains the majority of "high level" organizational threats. You can download the social media risk assessment document here.

STEP 2: Determine the vulnerabilities (weaknesses) that can create an environment in which the threats can manifest. In some cases a threat will have only one vulnerability associated with it. However, in the majority of cases there will be multiple vulnerabilities associated with each threat. If you inspect the template social media risk assessment you will see multiple vulnerabilities per threat (see graphic above).

STEP 3: Once the threats and vulnerabilities have been identified it is time to determine the internal controls that are in place. Internal controls are the practices and processes that will keep the vulnerability from turning the threat into a reality. The template provided contains common controls. It is not likely that every organization will have every control listed. The greater the number and breadth of controls in place, the less likely the threat will take place. Each control should be listed on the risk assessment as shown in the template document.

STEP: 4: Based upon the internal controls in place and the nature of the threat and vulnerability, the organization must determine the likelihood that the threat will take place. A sample Likelihood Matrix is such as the one shown below is contained in the template.

STEP 5: Next, the organization must determine the severity of the effect of the threat if it were to manifest based upon the existing controls. Similar to the Likelihood Matrix, the template contains a Severity Matrix such as the one below.

STEP 6: Finally, the organization uses both the Likelihood of Occurrence and the Impact of Severity to determine the Risk Level. The template also contains a matrix to assist in the determination of risk.

STEP 7: After completing the social media risk assessment it should be reviewed. Considerations in the review include a risk level that is too high relative to the organization's risk appetite. For example, it may be the policy that all "moderate" and "high" risk areas be reviewed with senior management to discuss further internal controls that can be implemented to reduce the risks. It is generally a good idea to summarize the risk assessment process and deliver a report to the organization's Audit Committee and possibly the Board of Directors. Along with the report may be recommendations or action items that will be taken to increase the number of internal controls to reduce the overall risk. Once such action items are completed the organization can again perform the risk assessment to determine if the internal controls have been effective in reducing the risk level.

It must be noted that there are many ways to conduct a risk assessment. This method is just one. There is no right or wrong methodology as long as the end result provides an assessment of the residual risk and considers all of the practical threats.

I encourage you to take this template and turn it into your own. I also ask that you return to this post with you recommended revisions/enhancements to the template so that others may also benefit.

Enjoy.

Social Media Risk Assessment Process - Part 4

2012-02-22T11:33:00.000-08:00

The Social Media Risk Assessment Process ("SMRAP") should be incorporated as a component of the organization’s overall risk management strategy.

Generally, a revised social media risk assessment should be conducted on an annual basis. The fundamental basis of the SMRAP is to balance the Bank’s desire and need to utilize social media with other factors associated with doing business. The organization must recognize that some risk must be accepted to make use of social media business. The organization must also recognize that some social media risks exist regardless of the organization's social media strategy. As such, the risk assessment program provides a practical approach to efficiently and cost-effectively identifying risks associated with social media use - regardless of the look and feel of the organization's social media strategy.

Risk assessments help ensure that employees comply with the organization's requirements as outlined in its social media policy, code of conduct and other related policies. The SMRAP also raises employee awareness regarding social media risks associated with their business unit’s use of social media. Additionally, the SMRAP assists the organization in making informed decisions about the need for additional risk mitigation controls.

The SMRAP can be conducted by a centralized department or rolled out to departments and sites on a decentralized basis. Each organization must determine how to best disseminate the SMRAP. The goal of the SMRAP is to identify threats and vulnerabilities posed by social media. This may be difficult to do through a centralized approach if the organization is large and/or spread out geographically.

Those responsible for performing the SMRAP must determine each threat and associated vulnerabilities. For each vulnerability the manager must determine the controls in place to prevent the vulnerability from exploiting severity of impact upon the organization and determine the likelihood of the vulnerability exploit occurring given existing internal controls. It is important to note that this process requires a certain level of subjectivity. As such, the success or failure of the SMRAP hinges upon the knowledge and understanding of the individual(s) performing the SMRAP. As such, the organization should select individuals with experience in assessing risks and business impact. The use of junior staff to conduct the SMRAP may under- or overestimate the conclusions - unless the staff are well supervised. Part 5 of this series will describe an easy manner to document the SMRAP.

Once the risk level is determined for each threat/vulnerability pair, organizations may consider additional controls for moderate- and high-risk levels. After the control enhancements have been incorporated, the risk threat/vulnerability pair is re-evaluated to determine the residual risk after the control is implemented.

The outcome of the SMRAP process is the mitigation of risk to acceptable levels, thereby providing adequate protection to the organization. As such, to the extent that moderate- and high-risk levels exist after the implementation of mitigating controls, a discussion of the threat should be elevated to senior management for further discussion. It is important to note that operating under moderate- or high-risk levels is not uncommon. However, under such circumstances it is important to ensure that the appropriate parties are aware of the risks in order to ensure that all options have been considered as well as to ensure that all parties are aware of the risks. This awareness is crucial for line units - particularly during periods of duress. Consider it a form of CYA!

In cases in which additional controls must be implemented to mitigate moderate and high risks, the organization should consider the development of a formal written action plan that documents the controls. The action plan should include the steps to be taken, the time frame for completion and the individuals responsible for implementation of the controls.

It is highly recommended that the SMRAP be evaluated by the appropriate parties within the organization. This may include the CEO, CIO, IT Steering Committee, Compliance Committee, Audit Committee and the Board of Directors. The purpose of the review should be to share the strengths and weaknesses of the organization’s social media strategy from a risk perspective. Identified organizational vulnerabilities should be addressed with the appropriate personnel for the purpose of implementing corrective actions.

The SMRAP focuses on strategic and operational issues. Organizational vulnerabilities are weaknesses related to the organization’s policies or practices that can result in the manifestation of a threat. Part 5 of this series will drill down into specific threats and vulnerabilities. Part 5 of this series will provide as a template the most common threats and vulnerabilities. However, the framework that will be introduced in Part 5 provides sufficient flexibility to allow the user of the SMRAP to customize the process with organization-specific threats and vulnerabilities.

Social Media Risk Assessment Process - Part 3

2012-02-21T15:45:00.000-08:00

Risk is the possibility of an act or event occurring that would have an adverse effect on the organization. Risk can also be the potential that a given threat will exploit vulnerabilities to cause loss of, or damage to, the organization. Risk is generally measured by a combination of severity and likelihood of occurrence.

A threat is an action or event that might jeopardize the organization. It is a sequence of circumstances and events that allow a human (disgruntled employee, etc.) or other agent (virus, Trojan horse, etc.) to cause a misfortune by exploiting vulnerabilities. A vulnerability is a weakness that allows a threat to manifest itself.

Considerations to keep in mind when determining threats:

Determining the legal implications and contingent liability associated with any identified risks. For example, if hackers successfully access the organization’s Facebook account and use it to subsequently attack followers/friends, the organization may be liable for damages incurred by the party that is attacked.
Capability and motivation are important attributes of threats. Threats need both attributes (capability and motivation) to be credible. For example, a skilled hacker seeking access to a Facebook account is considered a credible threat because the hacker has the capability (skills) and motivation (financial/ideological gain from the use of the organization's Facebook account).
Interested parties. Serious hackers, interested computer novices, dishonest vendors or competitors, disgruntled current or former employees, organized crime rings or even agents of espionage pose a potential threat.
Poor security program/poor employee security awareness. Hackers often exploit well-known weaknesses in creating secure passwords.

Internal controls are mechanisms that enable the organization to achieve its business objectives. With appropriate controls in place the organization is able to effectively mitigate the risk posed by a threat. With respect to social media, internal controls are designed to meet three main objectives:

Confidentiality: Preventing the disclosure of sensitive information;
Integrity: Preventing unauthorized modifications to information and maintaining internal and external consistency; and,
Availability: Ensuring that the systems are working and that the data is accessible to users as required.

In addition to requiring the documentation of threats and vulnerabilities, the SMRAP also requires the documentation of associated controls. To maintain an effective social media risk assessment process the organization must ensure that the organization has adequately considered the implementation of the following types of controls:

Preventative Controls: These controls are established to avoid occurrences of unwanted events. This type of control may include passwords, policies, procedures, security awareness program, etc. These controls are considered “proactive.”
Detective Controls: These controls alert and identify violations after the fact. These controls can include social media monitoring and other information that provides notification after the event has occurred. These controls are considered “reactive.”
Corrective Controls: These controls are intended to remedy unauthorized events and to restore the original controls. For example, the ability to reset the custodian of a social media account that has been locked-out due to some adverse event is considered a corrective control.
Deterrent Controls: These controls discourage violations. For example, a policy statement that states that violators may be terminated for non-compliance with the social media policy is considered a deterrent control.

Part 4 of this series will begin discussion on the risk assessment process.

Social Media Risk Assessment Process - Part 2

2012-02-20T19:13:00.000-08:00

The first step in the Social Media Risk Assessment Process ("SMRAP") is to identify the social media-related threats that can adversely affect the organization. While these threats can be technology-based, they are most dangerous when they originate from human acts.

The ubiquitous use of social media has brought social media-related threats to the forefront. Among the threats associated with social media are:

Disclosure of Confidential Customer Information by Employees;
Disclosure of Confidential Company Information by Employees;
Systems Outages Due to Social Media-Based Virus/Malware Infections;
Remediation Expenses Related to Social Media-Based Virus/Malware Infections;
Loss of Branding Content Contained on Social Media Platforms;
Lawsuits Related to Alleged Improper Use of Social Media in the Hiring Process;
Lawsuits Related to Alleged Improper Use of Social Media in the Termination Process;
Loss of Opportunity to Hire Star Employees Due to Information Contained on Social Media Platforms;
Spam/Malware/Virus Attacks Against Social Media Platform Friends/Followers; and,
Excessive/Inappropriate Use of Social Media by Employees.

The SMRAP in and of itself does not assure adequate protection against social media-related risks. Rather, the SMRAP is part of the organization’s overall Risk Management Program that includes the written policies, guidelines, employee awareness/training and an independent review of the organization’s social media practices.

The SMRAP concludes with a determination of the adequacy of existing controls relative to the identified threats and vulnerabilities. The SMRAP allows management to determine the need for additional controls to reduce the Bank’s risk exposure.

Since threats and vulnerabilities change over time, the SMRAP must be updated and reviewed on a regular basis to ensure the appropriateness and effectiveness of the controls in place. Updates are minor changes to the existing risk profile. These include changes resulting from the implementation and/or removal of a control, or when the effectiveness of a control changes. Updates occur when the following events take place:

New control is implemented;
An incident highlights a minor discrepancy in the current risk profile (i.e., the likelihood or severity of a threat requires minor adjusting or the effectiveness of a control requires adjustment);
A risk is no longer applicable; and,
A new risk emerges.

The SMRAP should generally occur on an annual basis. The SMRAP should also take place when the following occurs:

Increase in security risks/exposures due to an event or series of events (i.e., significant change in organization's social media strategy, development/implementation of in-house social network, etc.);
Cumulative updates indicate the need for a review;
Changes in regulatory requirements; and,
Serious social media-related incident.

The results of the initial SMRAP and periodic SMRAP updates should be provided to the appropriate party within the organization such as the organization's Audit Committee and Board of Directors.

Part 3 of this series will discuss risks, threats and vulnerabilities.

Series:
Social Media Risk Assessment Process - Part 1

Social Media Risk Assessment Process - Part 1

2012-02-19T23:23:00.000-08:00

Do you hear that? There it is again. Did you hear it that time?! Oh man, it's worse than I thought. The bank examiners are updating their examination procedures to include "social media" and the industry is not ready for it. What does that mean? Low Hanging Fruit Time. Noooooooooo....

This post is about the development of a Social Media Risk Assessment Process (“SMRAP”). The SMRAP provides organizations with a systematic approach to evaluating exposure to social media-related risks. The SMRAP focuses on five components: Threats, Vulnerabilities, Controls, Likelihood of Occurrence and Impact.

Social Media Risk Assessment Matrix

The SMRAP is intended to achieve one basic goal: the protection of the organization's reputation.

Management is responsible for ensuring that systems and data are adequately protected. Historically this has related to the systems and data maintained within the organization's walls. Unfortunately, as an organizations are increasingly moving to third-party social media platforms such as Facebook, Twitter and LinkedIn (and for good reasons), management must now take measures to adequately controls risks related to external systems.

Management is also responsible for protecting the organization's reputation from intentional and unintentional acts that may cause harm to the organization. Unfortunately, reputational harm can come from many directions, including public outcry (think Bank of America's debit card debacle or Occupy Wall Street).

An organizational key business objective is to maintain a set of policies and procedures that protect and mitigate against risks related to day-to-day operations. Social media risks have become part of the day-to-day risks of any organization. As has been previously stated, organizations cannot determine whether or not to participate in social media. Social media happens. And it has been happening for some time. The question is whether or not management has realized this fact and has moved to mitigate the risks before the risks mitigate the organization.

The SMRAP is used to identify, evaluate, document, monitor and manage social media risks. Through the SMRAP the organization is able to identify and prioritize social media-related risks and develop appropriate risk management strategies. Such strategies include the establishment of appropriate policies and the selection of cost-effective controls that implement the policies.

Part 2 of this series will begin the process of identifying the social media threats that must be evaluated as part of a risk assessment process.

Social Media-Based Brand Ambassadors - Part 4

2012-01-17T01:21:00.000-08:00

The Costs and Risks of Social Media Brand Ambassador Programs

[This post is part 4 in a series of posts related to Social Media-Based Brand Ambassadors. This post focuses on the costs and risks associated with a brand ambassador program.]

Before an organization chooses to empower and unleash social media-enabled employee brand ambassadors to represent its brand and influence consumers, the organization should carefully consider the costs and risks associated with a social media-enabled brand ambassador program – or any social media effort.

While social media accounts are generally free and can be created in less than 10 minutes, these accounts are of little use without the human capital (e.g., brand ambassadors) needed to add value to the organization’s social media efforts. As such, every organization considering the use of social media-enabled brand ambassadors should conduct a risk assessment that will help to identify potential pitfalls which will ultimately protect the organization and ensure the success of the social media-based brand ambassador program. The organization should use the results of the risk assessment in determining the appropriate strategy.

Bloomberg Businessweek writers Michelle Conlin and Douglas MacMillan address social media risks in their blog post, “Web 2.0: Managing Corporate Reputations.” According to Conlin and MacMillan, “Social networking is a love-hate relationship. On the one hand managers want their workers to experiment so they can cultivate new-world skills. Employees as brand ambassadors! Products virally transformed into overnight hits! On the other hand, bosses are filled with foreboding about social networking’s dark side – losing secrets to rivals, the corporate embarrassment of errant employee tweets, becoming the latest victim of a venomous crowd.”

Regardless of the puffery taking place regarding the low- or no-cost features of social media implementations, organizations must not be fooled. Social media properly implemented costs money. As such, organizations must determine the social media strategy that best fits the organization’s risk appetite and budget. In an effort to assist with this analysis the following section discusses the various risks and costs associated with social media implementations – including a social media-based brand ambassador program.

Commitment: According to consultant Tony de Bree (www.TonydeBreeAdvies.nl), organizations have done a horrible job of taking care of their employees and customers. “Clients nor employees believe those companies anymore. We are far from ‘how to turn your ex-employees into ambassadeors/promotors.’”

Julie Arnsdorf, President of J. Arnsdorf & Company (jarnsdorf.blogspot.com), agrees with de Bree. “It's similar to the proverbial tag of we have ‘quality products’ or ‘competitive rates’…it's just talk. I've seen many marketing departments or ad agencies develop brilliant tag lines for an organization, but the organization never implements the tag line's sentiment throughout their business or bank. It's simply a hollow statement.”

De Bree’s and Arnsdorf’s comments are not uncommon. Over the course of the past several decades, organizations have lost credibility with their workers as a result of actions that have eliminated jobs and cut wages. Most recently, the Occupy Wall Street movement brought to light society’s discontent with the widening gap between the have and have-nots.

As a result of the natural skepticism of employees and customers, organizations seeking to implement a brand ambassador program must be committed to making the long-term investment necessary to win over both employees and customers. Lip service is no longer adequate and will surely result in failure.

Expenses: Many publications, consultants, Web sites and other sources refer to social media as a “no cost” or “low cost” undertaking. This advice has the effect of misleading many organizations into believing that the implementation and maintenance of a social media strategy, including a social media-based brand ambassador program, is a largely inexpensive undertaking.

In a interview with SmartBlog blogger Sam Taute (“A LookAt Social Media Costs And Returns With Erik Qualman”), Socialnomics author Erik Qualman stated regarding social media implementations that “Over 50 percent of businesses found it was more work than they expected. The most overlooked cost for big and small businesses is the soft-cost in terms of the hours employees must commit to engage properly in the space.”

Blogger Mark W. Schaefer presents a compelling, though potentially discouraging, argument for employee social media ambassadors. In his post “The Hidden Costs of Social Media Conversation” Schaefer states about social media-enabled employee brand ambassadors, “Certainly this interaction can humanize a brand. But at the end of the day, is paying your employees to be a psychotherapist to a lonely widow in Pittsburgh going to sell hamburgers? Is that the company’s core business? And when does it end? Do you keep adding people to have infinite conversations?” Schafer’s comments were in reference to an interview by McDonald’s Social Media Director Rick Wion regarding McDonald’s goal of initiating social media conversations.

Providing a less severe analysis is Brand Infection blogger Nader Cserny who states that “Social Media is affordable and you don’t need large marketing budgets. The only main cost is time while developing relationships.” While Nader’s conclusion is largely true, as stated by Schaefer, organizations must invest time and money to develop the depth and range of online relationships that meet the organization’s expectations.

Heidi Cohen provides on her blog (“How To Calculate Social Media Costs”) 10 types of social media marketing expenses that every organization should take into consideration when developing a social media strategy. Heidi’s list is not specific to brand ambassadors. It is a list that addresses the costs necessary to develop an environment in which brand ambassadors can operate.

1. Brand Monitoring: This expense relates to the act of “listening” to conversations on the Internet. Costs can range from the software used to “listen” to the employee time spent “listening” to the time spent analyzing the conversations to the time spent producing reports. As previously stated, brand monitoring is a key activity for all organizations. Regardless of the organization’s decision to enter into social media, every organization at a minimum should actively listen to comments made on the Internet in an effort to better serve customers and take proactive measures, if applicable. As such, all organizations should realistically budget for this item.

2. People: A social media-enabled brand ambassador program requires people. In small and mid-sized organizations most brand ambassadors will maintain other positions within the firm and will act as brand ambassadors as time and opportunity permits. In large organizations, brand ambassadors may be dedicated social media-enabled brand ambassadors whose responsibility is to comb the social media universe for branding/influencing opportunities. Regardless of the format used, people cost money. As such, to the extent that brand ambassadors conduct their influencing while on the clock, the organization incurs a cost.

3. Content: Content is King! According to the HR Management Guide blog (“SocialMedia Costs”), “The social media are about the interaction. The dedicated employee has to find appealing information and has to publish information on a regular basis.” The content used by brand ambassadors to engage with customers and potential customers must be created either internally or externally. The nature, complexity and source of the content will determine the expense.

4. Social Media Platforms: As previously noted, most social media platforms are free to use. However, there may be costs associated with their use such as the development of platform specific pages/screens (e.g., Facebook landing pages) that require resources to create. Organizations must be aware of such costs as part of the planning stage of a social media strategy.

5. Support Media: The social media strategy will determine the extent to which support media will be necessary. For example, organizations may create mailings, newspaper advertisements and other activities to drive traffic to the social media platform.

6. Marketing: Activities needed to convert social media prospects to buyers. This includes the marketing campaigns that run on the social media platforms such as custom “apps.”

7. Agencies: Certain organizations may choose to outsource some or all of the social media activities. These costs must be taken into consideration as part of the overall social media strategy. Agencies costs may include consulting fees, social media outsourcing costs, and other associated expenses.

8. Technology: To the extent that technology support is needed to launch and maintain a social media-based brand ambassador program, these costs must be taken into consideration. Such costs may include providing employees with social media enabled smart phones, upgrade of computers, and any other technology that may be needed.

9. Analytics: Every organization with a social media program should have in place a program to analyze the overall effectiveness of the organization’s social media strategy, including brand ambassadors. The analytics provide the organization with the social media program’s return on investment.

10. Complexity: Organizations can spend very little on their social media efforts. Likewise, organizations with large budgets can spend millions of dollars creating elaborate and complex social media strategies. With social media there is something for every budget. This amount must be taken into consideration as part of the planning process.

Code of Conduct: Brand ambassador success requires that employees commit to the organization’s code of conduct (e.g., respectful tone, free of profanity, etc.) whenever they interact on a social media platform. Brand ambassadors must understand that their personal social media activity may be interpreted as organization-sanctioned activity. Therefore, whether on or off the clock, employees must be aware of the effect that their interactions on social media platforms may have on the organization.

A major challenge in developing a strong Brand Ambassador Program is that employees continue to become less loyal. Back in 2004 Ronald J.Alsop had the following to say about the state of employee relations: “Employees are more cynical and less trusting because of all the recent cases of accounting abuse and executive greed. What’s more, job insecurity, poor morale, and excessive workloads have eroded employees’ commitment to companies.” In the post-Occupy Wall Street era it is very likely that these same issues continue to concern workers in 2012.

Blogger Linda Tucci describes in the TotalCIO blog at TechTarget.com (“SocialMedia Risks That Will Make Your Hair Stand on End”) an instance involving an executive at a public relations firm. The seasoned public relations executive was flying to meet with a major client. Upon arriving at the client’s hometown, the public relations executive tweeted that the client’s hometown was one of those places where he would rather die than have to live in. An employee of the client’s firm read the tweet and passed it on to senior officials at the client and the public relations firm. To say that the public relations executive had some explaining to do is an understatement. The embarrassment caused to the public relations firm by its executive was further exacerbated by the fact that the public relations executive was meeting with the client to pitch, of all things, social media communications!

The public relations executive story noted above is an example of a major concern with social media-enabled brand ambassadors. For this reason it is crucial that organizations provide necessary guidance and training to brand ambassadors. Ignoring this call to action may result in similarly embarrassing situations that may damage reputation and the bottom line.

Customer Service: Rajib Kumar, blogger on Techncom.com, states that “When a consumer posts an issue online, he expects instant response which should be done promptly. If the response drags, then it has a negative effect on the brand. Don’t give the consumer time to start bad-mouthing.”

While a 24X7 response is not required for all social media programs, customers now expect to reach organizations via their social media platform of choice. Further, customers expect prompt responses during business hours. Their inability to resolve issues in that manner will go a long way in pushing them to organizations that do provide the expected service.

To the extent that the organization provides customer service through a call center, it is in the organizations best interest to equip the service center with the training and tools needed to provide the expected level of service.

Inconsistent Messaging: Rajib Kumar emphasizes the importance of providing consistent messaging by stating that “If a query has been posted on different social platform, the response should be the same and consistent throughout so as not to confuse the customers.” As such, “The staff managing the social media platforms needs to be organized and have a common vision and goal so that they do not speak in different voices on different platforms.”

Scale: The HR Management Guide blog suggests that organizations should seek as large of a social media presence as possible to maximize use and investment in social media. “The social media need a strong and constant presence. The small presence means no influence, and it does not bring any benefits. The organization has to build a strong and focused presence to be successful.”

Before developing a program to unleash the organization’s employees as brand ambassadors, the organization must ensure that it truly understands the costs and risks involved and is committed to the undertaking. Without such a commitment the organization will ultimately fail in its attempt to leverage the advantages of social media.

Social Media-Based Brand Ambassadors - Part 3

2012-01-11T01:03:00.000-08:00

BENEFITS OF SOCIAL MEDIA-BASED BRAND AMBASSADOR PROGRAMS

[This post is part 3 in a series of posts related to Social Media-Based Brand Ambassadors. This post focuses on the benefits associated with a brand ambassador program.]

According to Tom Blackett in Brands and Branding (Bloomberg Press, 2009), “When employees are excited by the proposition they will help to sustain it and communicate it to customers, suppliers and others through their enthusiasm and commitment.”

Forrester Research, Inc.’s Cindy Commander states in the 2007 Report Brief: Transforming Employees Into Brand Advocates that “Employees who actively ‘live the brand’ create significant benefits for both the customer and the organization. Customers of organizations with employee brand advocates enjoy better customer service, greater anticipation of and ability to have their needs met, and more attentiveness to their voice and feedback. The organization enjoys the benefits of word-of-mouth marketing, greater profitability and financial results, and a more differentiated brand.” Social media-enabled brand ambassadors provide benefits to the organization as a result of their efforts to humanize the organization.

Ability to Humanize the Organization: AdWeek Magazine blogger Noreen O’Leary emphasizes (“Employee Benefits: Workers as BrandAmbassadors”) that “The use of workers to humanize corporate entities has been a time-honored marketing tradition, of course. But in an era of Web 2.0 transparency, their visibility takes on greater meaning, signaling the higher importance of customer service in the marketing mix. More subliminally, as America’s battered consumers have lost faith in the institutions they hold responsible for the current economic mess – and are angry with corporations behind massive layoffs – staffers offer a kind of peer credibility as corporate advocates.”

Social media-enabled employee brand ambassadors can play a major role in changing the public’s perception of the organization. Brand ambassadors have the ability to transform cold and impersonal organizations into warm and friendly customer-friendly companies. Instead of dealing with an abstract concept, logo, or the image of an ivory tower, social media-enabled employee brand ambassadors are able to transform transactions into human relations. Social media platforms provide the “social” vehicle to connect with customers at a personal level – something that is not possible through static Web pages and advertising.

Organizations transform themselves by responding to social media inquiries as well as seeking out and creating “conversations” on social media platforms. These interactions are perceived positively if the communication is determined to be honest, genuine, and transparent. Through these activities brand ambassadors have the ability to transform customer interactions into rewarding personal experiences.

Brand Awareness: Social media-enabled employee brand ambassadors can be very effective at creating brand awareness. While the reach of a brand ambassador is generally not the same as a mass market advertisement, the quality of the social media interaction can produce a valuable word-of-mouth affect – the “viral” affect – that can create significant awareness and interest in the brand.

A sound Social Media-Based Employee Brand Ambassador Program turns employees into influencers. As long as the brand ambassadors act in an honest and transparent manner and consistent with expectations, they can create a favorable impression of the brand.

Meet Customer Expectations: Social media platforms act as convenient and easily accessible forums where customers and potential customers can reach out to organizations through their brand ambassadors. Customers are able to use social media platforms to pose questions, make statements or generally express their feelings about the brand on their time and on their platform of choice (Facebook, Twitter, Foursquare, LinkedIn, etc.).

The use of social media-enabled employee brand ambassadors allows organizations to meet these customer expectations. According to Top DogSocial Media blogger Melonie Dodaro, “More than one quarter of all the time people spend online is spent on social networks. Regardless of what their needs happen to be, they are turning to sites like Twitter and Facebook in order to find what they are looking for.”

The result of widespread use of social media is the recently developed customer expectation that organizations should also reside on the social networks used by customers. Social media-enabled brand ambassadors that monitor social media platforms allow organizations to not only react to demand but to also proactively create a social media presence.

Techncom.com blogger Rajib Kumar states that “Customers want immediate acknowledgement and resolution and are not willing to wait endlessly listening to call Centre hold tunes. Consumers want instant gratification even in customer service. Smart and savvy businesses have started using the social media space to get closer to their customers and increase their service levels up a notch vis-à-vis the competition.”

Brand Differentiation: In today’s globally competitive marketplace it is not enough to be just as good as the next guy. In today’s business environment it is important to be different. Anyone can make a plain vanilla product. And vanilla generally tastes the same regardless of the maker. As such, unless the organization seeks to enter a price war over vanilla, the organization is better suited finding a way to differentiate its products or services.

Brand ambassadors provide the organization with a method of setting itself apart from the competition. Relative to competitors that do not employ brand ambassadors the organization is able to set itself apart. This differentiation not only assists the organization in avoiding vanilla product pricing but may also provide for the opportunity to create loyalty and charge premium prices.

Early Warning System: Social media monitoring involves the use of applications such as Google Alerts, SocialMention.com and radian6 to locate comments that reside on social media platforms. Identification of comments enables the organization to provide a timely response that is likely to be appreciated by the commenter.

According to Techncom’s Kumar, social media monitoring provides organizations with an early warning system. Customers will generally give organizations an opportunity to “right the wrong” before unleashing their fury on social media platforms. As such, organizations that utilize social media-enabled employee brand ambassadors to “listen” to social media conversations are able to proactively identify and address problems before they manifest into major public relations disasters.

Top Dog SocialMedia blogger Dodaro says that “Using social media the right way means you’ll also have the ability to listen to your audience, find out what their needs are and offer them a solution.” An additional benefit is derived from customers that share the positive experience via social media, turning themselves into a customer brand ambassadors.

Development of a Knowledgebase: The use of social media to locate and answer organization-specific questions benefits not only the party asking the question but also others that may have similar questions. It is not uncommon for customers and prospective customers to search the Internet for answers to product and/or service-related questions. To the extent that the response to a question is addressed on a social media platform it is subject to search engine indexing that makes the response retrievable by others. The availability of this information is likely to be viewed favorably by customers and prospective customers.

Techncom’s Kumar says about creating a public knowledgebase, “It can become a great resource for future reference and a guide point for other customers who will refer to the link or post.” But the knowledgebase need not only include responses to questions. It can also include proactive information provided through blog posts, tweets and other information.

Improved Financial Results: It is no surprise that an increase in brand awareness results in improved financial results. However, a Social Media-Based Employee Brand Ambassador Program will not in of itself create blockbuster financial success. It will contribute to the bottom line along with the organization’s other revenue generating activities. Regardless, its effect should not be minimized as it has the potential to become a significant contributor to the organization.

Dow Jones Media Lab blogger Diane Thieke (“Employeesas Brand Ambassadors: Enthusiasm is Infectious”) states, “Today, I don’t think there’s much question about whether there’s a benefit to having employees engaged as brand ambassadors in social media.” Instead, Thieke believes that that key question is how to effectively manage a Brand Ambassador Program.

To the extent that an organization can establish a sound Social Media-Enabled Brand Ambassador Program and use it to motivate its employees, the organization can become incredibly effective at influencing stakeholders. The consensus among the experts suggests that the maintenance of a cadre of brand ambassadors results in stronger branding, improved customer satisfaction, increased revenue and stronger overall financial results.

Social Media-Based Brand Ambassadors - Part 2

2012-01-01T20:42:00.001-08:00

EMPLOYEES AS BRAND AMBASSADORS

[This post is part 2 in a series of posts related to Social Media-Based Brand Ambassadors. This post focuses on the concept of using employees as social media-enabled brand ambassadors.]

Brand ambassadors are what current and potential customers see when they interact with an organization. Brand ambassadors provide customers and others with a real person with whom to interact when dealing with an organization. Instead of visualizing an organization as an abstract concept, a logo, or the image of an ivory tower, the brand ambassador humanizes the exchange or transaction. A social media-based employee brand ambassador program allows organizations to personalize the growing number of Web-based transactions into brand-enhancing experiences, resulting in improved reputation, increased sales, and other positive effects that strengthen the organization’s brand and provide benefits to customers, employees, shareholders and other stakeholders.

Ronald J. Alsop notes in The 18 Immutable Laws of Corporate Reputation that “Employees’ behavior and comments outside business hours can carry significant weight. In many cases, people’s only experience with a company is through its workers. Word-of-mouth impressions gleaned from employees can be quite positive if they’re fiercely loyal to their companies – or deadly if they’re miserable in their jobs.”

Prior to the social media explosion brand ambassadors conducted their influencing activities during face-to-face social and business functions such as community fairs, chamber of commerce gatherings, Rotary meetings and other activities. An example of a successful “old school” brand ambassador program is the Oscar Mayer “Hotdogger” brand ambassador that has since 1936 travelled around the country in hot dog-shaped Wienermobiles.

While the Hotdogger brand ambassador served a purpose yesterday, and still today, social media has enabled brand ambassadors to use tools such as social networks, blogs, and other forms of social media to supplement traditional influencing activities. It is important to clarify, however, that a social media-based employee brand ambassador program does not replace but only enhances traditional brand ambassador activities. Social media merely provides brand ambassadors with an additional venue on which to conduct influencing activities. Today’s Web 2.0 environment requires that brand ambassador programs include both traditional and social media components.

Referring to today’s brand ambassadors, Inc. Magazine’s Markowitz says “They can be tweeters, bloggers, Facebookers – or they could just be the people you send to corporate events. More than your firm’s logo or an actor in your company’s commercial, your customers will come to know your ambassadors as true representatives for your business’s mission.”

According to Smarp blogger Roope Heinila (“Employees As Brand Ambassadors In Social Media”) “Social media has changed the impact that company employees can have on their employers brand image. While in the past only marketers, sales people and customer service have had controls over the brand image it has now become the responsibility of every employee with a presence in social media (at least to some extent).” Heinila further cites a study that claims that “61% of employees are proud of their employer and would be willing to share this information with others over social media.”

Evan Maier concurs on the Marketing Blog: FootPrints blog: “The key to successfully leveraging social media to boost a brand isn’t about targeted planning, million-dollar strategies, or figuring out some secret insiders’ trick; it’s about whoever has the loudest voice. In traditional media, that means ad buys. In social media, that means brand ambassadors regularly engaging your audience.”

So, do social media-enabled employee brand ambassadors differ from traditional brand ambassadors? The answer is “yes” and “no.” As noted above, social media is merely another venue for brand ambassadors to conduct their influencing activities. What this means is that brand ambassadors now use social media as an additional venue to conduct their influencing activities which includes strategy implementation, community development, and reputation monitoring.

· Strategy Implementation: Every organization should maintain a plan, whether formal or informal, that identifies management’s strategy for introducing and/or broadening the organization’s brand within its target market. In other words, brand awareness. In the big picture this may include activities such as advertising, event sponsorships, in-store announcements, etc. Social media-enabled employee brand ambassadors are responsible for converting the overall strategy into action through the use of social media platforms. Such implementation may include the creation of a blog. Other examples include the establishment of accounts on social media platforms such as Facebook, Twitter, LinkedIn, etc. It is the social media-enabled employee brand ambassador’s responsibility to implement actions that are consistent with the organization’s overall brand strategy.

· Community Development: Organizations that understand how to use social media in a business setting know that its best use is in the development of “communities.” Wikipedia defines “community” as “A group of interacting people, living in some proximity (i.e., in space, time, or relationship). Community usually refers to a social unit larger than a household that shares common values and has social cohesion.”

In the case of social media-enabled employee brand ambassadors, creating a community means creating a group of formally or informally connected individuals that have an interest in an organization’s products or services. Such a community includes the collection of people that “friend” the organization’s Facebook page or that “follow” it on Twitter. It can also include those that register to receive news feeds from its blog or any other activity that keeps people “in the know” relative to the organization. It is the social media-enabled brand ambassador’s responsibility to engage these communities in activities that put a human face on the organization, thereby enhancing its brand value.

· Social Media Monitoring/Listening: One of the most important lessons of social media that every business must heed is to develop a social media monitoring or listening program. Due to the ubiquity of social media use, customers and non-customers may be making reference to the organization in one form or another. Without a social media monitoring program the organization is unaware of such activity.

Establishing a monitoring program can be as easy and inexpensive as utilizing Google Alerts or SocialMention.com. Both of these applications provide the ability to establish reports based upon key terms, such as the organization’s name, found on Web pages, blogs, social networks and other social media platforms. Larger and more complex organizations may opt for more robust and pricey options such as radian6 (www.radian6.com).

If good things are being said, it is always a good idea to have the brand ambassador recognize the compliment to demonstrate that the organization is listening and cares. If the information posted is less than stellar, the brand ambassador must inquire about the negative experience in an effort to correct the problem. At a minimum, even if there is no ability to repair the situation, the brand ambassador can offer an apology or at a minimum, acknowledge the situation.

In all instances, social media monitoring provides brand ambassadors with the ability to report the details to the appropriate individual or department within the organization in order for the organization to become aware of what works and what doesn’t work. The organization should consider all such instances as learning opportunities and a way to improve customer relations.

In the post-Occupy Wall Street era, consumers are skeptical of everyone. This is especially true of large organizations and financial services providers. Through honest, transparent, and consistent attention to the communities and their needs, social media-enabled employee brand ambassadors provide organizations with an effective tool to enhance value and/or repair reputational damage. They also act as proof positive for customers and potential customers seeking evidence of the organization’s brand promise.

Social Media-Based Brand Ambassadors - Part 1

2011-12-30T13:53:00.000-08:00

INTRODUCTION

[This post is part 1 in a series of posts related to Social Media-Based Brand Ambassadors. This post introduces the concept of social media-enabled brand ambassadors and sets the tone for the series of posts that will follow.]

We’ve heard it hundreds, maybe thousands of times – “Our employees are our greatest asset.” When it comes to business-speak, this phrase has become one of the most overused expressions in the trade. From annual reports to media interviews to company rah-rah events, these words always find a way to make themselves at home. Yet no matter how trite we believe the phrase to be, it is true. There is no denying that in business there is little that can be done without human capital. That’s because regardless of technological advancements or an organization’s name, size, products, or services, people buy from people! This point is especially critical in the post-Occupy Wall Street era where humanity, honesty, and transparency have become the new expectation for business.

Many organizations have known for a long time of the value that is created by employees that evangelize on behalf of the organization. These employees are commonly referred to as brand ambassadors. Research and surveys have repeatedly found that brand ambassadors boost an organization’s reputation resulting in improved profitability. As a result of their excitement, knowledge, loyalty, and commitment to the organization and its products and services, brand ambassadors create excitement and loyalty among customers. As such, brand ambassadors act as incredibly effective influencers. More effective than the best advertising.

An excellent representation of the ideal brand ambassador is “Flo,” the customer service representative in Progressive Insurance commercials. Flo is so effective that current commercials portray her luring to Progressive Insurance executives from a competing insurance company. This is the employee brand ambassador concept at its best. According to a Business Courier article by Ric Sweeney (“Brand Ambassadors’ Give Your Business A Boost”) “All employees, regardless of function or title, are key ambassadors for your company’s products and services. Once motivated by senior management to believe in the company and its products/services, employees can utilize their network of friends and colleagues to grow the company’s circle of influence.”

Author Ronald J. Alsop tells a story in his book, “The 18 Immutable Laws of Corporate Reputation,” (Free Press, 2004) about Larry Fish, former Chairman and CEO of Citizens Financial Group. Alsop says “Larry Fish is rare among CEOs in that he recognizes the value of employees to corporate reputation and makes them his goodwill ambassadors. It’s the employees who are on the front lines working with customers, suppliers, shareholders, government officials, and other audiences. They must be your loyal allies because their effect on your reputation is immense. They can be your biggest fans or your worst enemies.”

While the characteristics (excited, loyal, and knowledgeable) of the brand ambassadors noted in Alsop’s 2004 book are the very same characteristics that embody today’s brand ambassadors, the manner in which they influence has evolved. Historically, brand ambassadors conducted their influencing activities primarily through face-to-face interactions. These interactions took place at their offices, civic meetings, places of worship, and anywhere else someone was willing to listen to them. Brand ambassadors are successful influencers not because they are great salespeople but because they love what they do and who they do it for. Their ability to influence is the result of their passion – as well as the positive reputation of the organization, product, or service.

While today’s brand ambassadors still possess excitement, loyalty, and knowledge, they are no longer confined to face-to-face activities. Through social media tools such as Facebook, Twitter, and LinkedIn, today’s brand ambassadors can influence a much broader audience. Social media enables brand ambassadors to influence not only their neighbors across the street but also those living across the country and across the world.

Facebook, the 800-pound social media gorilla, boasts over 800 million active users. Active users maintain an average of 130 “friends” on their Facebook social network. Twitter, another dominant social network, maintains over 100 million active users. LinkedIn, the social network of choice for business professionals, maintains over 135 million active users. And these numbers do not reflect the millions of users that belong to other social networks such as YouTube, Google+, Foursquare, MySpace, and hundreds of others. A cadre of social media-enabled brand ambassadors can produce results significantly better than was possible just a few years ago.

According Inc. Magazine blogger Eric Markowitz (“How To Find The Right Employees To Be Your Brand Ambassadors”), “In order to fully realize – and leverage – an employee’s full value, a successful company needs to find creative ways to tap into its employees’ networks (both online and offline). Brand ambassadors, or employee evangelists, are becoming an increasingly common way for brands to leverage their biggest asset – their workforce, of course – to reach new markets, generate buzz, and put a real face on the company.” Schwartz Communications blogger Allison VanNest states on the Schwartz Crossroads blog (“Must Love Snacking: Empowering BrandAmbassadors Through Social Media”) that “Employees are becoming more engaged as company influencers.”

Regardless of the demonstrated value that comes from an excited, loyal, and knowledgeable cadre of employees, there is often a discrepancy between the message delivered by the organization through its marketing efforts and the message delivered by its employees. This discrepancy is the result of the organization’s failure to formally train and deploy its employees as part of the organization’s overall branding strategy. This failure on the part of the organization denies the customer, employee, and organization an opportunity to maximize the benefit received. The customer misses an opportunity to receive the best possible attention. The employee misses the opportunity to play a larger role in the success of the organization. And the organization misses an opportunity to develop a deeper and more valuable relationship with the customer. The organization’s failure also ensures that employees lack the excitement, loyalty, and knowledge necessary to become effective influencers. The negative impact of this failure is compounded when the organization does not make use of the leverage provided by social media platforms.

Logical String blogger Mayank Krishna concludes (“Employees As Brand Ambassadors”) that this failure causes customers and potential customers to question whether “The brand is true to what it is projecting or are there things deeper than what meets the eye?” Krishna attributes the lack of employee influence-ability to the fact that “In a majority of organizations, brand and branding is a domain that is considered the exclusivity of brand managers and marketing managers. For an average employee, brand management doesn’t seem relevant and he/she is hardly aware of the nitty-gritty of the brands and brand management philosophies of his/her organization.”

As such, unless organizations create a formal Social Media-Based Employee Brand Ambassador Program to ensure that employees are well-trained brand evangelists, organizations will lose out on the potential benefit that comes from employees that decide to make it their mission to act as influencers for the organization. A further risk is the competition. To the extent that competitors develop their employees first, the organization puts its business at risk.

Managing Multiple Social Network Accounts

2011-12-18T22:55:00.000-08:00

Banks that are new to social media or are determining how best to jump into social media eventually ask the following question: “Should we start with one social network or several?” The answer? It depends.

All things being equal, being active on multiple social networks is better than one. Unfortunately, all things are not equal and resources, both human and financial, play a role in the ultimate look and feel of any social media strategy – including the number of social networks on which a bank participates.

According to the ReadyBuzz blog, “the biggest mistake most businesses make is to only use one social media platform. In most cases, they either choose Twitter or Facebook. The truth is, one just isn’t enough.” Many social media users maintain two or more social media accounts. In many cases these accounts are established when the user first visits the social network as part of a curiosity or through the referral by an acquaintance. However, regardless of many users’ maintenance of multiple social media accounts, users are not equally active on each social network. As such, users may only access one account on a regular basis and largely ignore the others. This means that a bank that focuses its social media efforts on a single social network risks missing out on a large portion of social media users that use other platforms.

Zmags blogger Christina Pappas recommends how to best utilize multiple social networks. According to Pappas, “there are many social media channels and most of us use each channel with a slightly different spin. The type of content we would Tweet is different than the content we may post to a Facebook Business Page. Both of those formats may require a different twist than we’d offer on LinkedIn.” Pappas makes the case for a strategy that differentiates the manner in which information is shared on each social network.

However, Inc. blogger J.J. McCorvey warns against biting off more than can be chewed. According to McCorvey, “If you have enough staffing power to handle multiple social networking sites, that’s great. If not, it’s important to focus on one or two, or you could spread yourself too thin and fall victim to the ‘gaping void’ perception, where you end up going days without activity. Your followers will notice.”

Social Media Today blogger Mark Evans echoes McCorvey’s advice. In one of his posts Evans recounts his advice to a small business. According to Evans, “my reluctance to suggest a multi-pronged approach was mostly due to the lack of available resources. The last thing I wanted to see was the company blast out with several Twitter accounts, only to see its efforts fail due to poor content or a lack of activity and engagement.

An example of the success that can be achieved through the use of multiple social networks is Starbucks. Blonde 2.0 blogger Ayelet Noff credits Starbucks’ multipronged social media strategy as one of the reasons why Starbucks has been successful at creating millions of fans for the brand and keep them involved in the brand’s doings. According to Noff, “The brand has created a digital dialogue with its customers, enabling people to give their feedback and receive a response back from Starbucks addressing their concerns/comments. Starbucks is showing its customers and potential customers – ‘hey, we care about what YOU have to say.’ I am certain that if each one of these elements was done alone then the strategy would not have been as successful and complete as it is when done like this in integration with the rest of the elements on board.”

Amanda Brooke, Drop Ship News blogger, speaks to the advantages of multiple social networks by stating that “by working on your brand on the most popular social media sites such as Twitter, MySpace, Facebook and YouTube, you can reach a much, much broader audience than traditional marketing methods.” Social Media Today blogger Daulton West, Jr. goes on to say that “’listening’ to their customers, and creating conversations that span several social media sites, allows for communication that strengthens relationships for existing and potential customers.”

In the final analysis, while it appears desirable to maintain several social network accounts simultaneously, it is critical that the bank maintain a budget that provides for adequate staffing to ensure that the bank’s social media efforts add value.

Look Who's Talking: Facebook Engagement

2011-12-09T00:02:00.000-08:00

Facebook recently began disclosing several key metrics on Facebook Pages to assist Page owners at-a-glance in assessing the success of their Facebook efforts and to assist visitors to the Page in determining how useful others have found the site in the past week. These metrics are disclosed along the left side of the Page (they, along with other metrics, are also found on the Insights page).

The first metric indicates how many users Like the page. Traditional Facebook marketing theory states that the bigger this number, the better. That is why so many social media consultants go on about tactics to increase "Likes" as if he with the most Likes wins. While I agree that all things being equal, more Likes is better than less Likes, I also believe that it's not the quantity of the Likes but rather the quality of the likes that will make a Facebook effort successful.

Social media is about social engagement. Social engagement does not occur unless the Facebook effort provides value. As such, it does not matter how many Likes a page has if the content is not engaging. Without valuable content the community will ignore the page resulting in a wasted effort to attract the community. In other words, a Page with 100,000 Likes that was created through some effective marketing effort will not help the bank if none of the 100,000 users visit the Page on a regular basis.

In order to evaluate the effectiveness of a Page's community, Facebook provides the number of users that have "talked about" the Page in the past seven days. This "talking about" statistic is fairly meaningful as it states the number of users that have engaged with the Page (e.g., brand) in some form. Activity that is included in the Talking About statistic includes users that:

"Liked" the page
"Liked," commented on, or shared a Page post
Answered a Question on the Page
Responded to an Event
Mentioned the Page
Tagged the Page in a photo
Checked in or recommended the Page location

In the examples below you see two sets of data taken from two banks - one small bank and one mid-size bank.

The bank on the left has only 409 Likes and the bank on the right has over 2,500% more at 10,850 Likes. A natural conclusion based on the Like data may be that the mid-size bank has created a more valuable Facebook asset. However, a review of the "talking about this" number suggests that while the mid-size bank has more likes, the absolute number of users that have engaged with the bank is identical. As such, either the mid-size bank has a bunch of uninterested followers or the small bank has an active bunch of followers.

So why is having as many users talking about the bank so critical? Well, it is the active and engaged users that are most likely to support and evangelize for the bank. These active users will tap into their social networks and inform their friends and acquaintances of the reasons why they should support the bank. In addition, new visitors to a Facebook page can look at these two metrics to understand how popular, active and engaging the Page is and as a result, whether it is one that they wish to follow. Losing out on an opportunity to engage new users results in a loss of not only that user but of that user's social network.

While banks should seek as many Likes as possible, they should also examine the number and percentage of followers that are engaging with the bank. If too few are engaging then the bank is not providing adequate content. This may result from too infrequent posts, too many "salesy" posts, too frequent posts, uninteresting posts, etc. It should be the job of the Facebook admin(s) to analyze the data to figure out how to best convert the nonengaged users into engaged users. Once users become engaged then their networks may also become engaged, and at that point the Facebook page may provide significant value. However, until engagement occurs, the Facebook page becomes that question about whether a tree falling in the woods makes any noise: if a Facebook page with tons of users creates no engagement does it provide value? Very little.

What To Do With Those Repos? Facebook Them!

2011-12-01T00:45:00.000-08:00

During these tough economic times it is not uncommon for consumer banks that originate auto loans - particularly used auto loans - to have to pick up a repossession or two. In many cases banks will dispose of the autos through wholesale auctions or wholesale transactions with used auto dealers. Depending on the car and the outstanding balance, sales through auctions or directly to dealers will result in marginal to significant write offs, as the banks are forced to accept deep discounts.

Fortunately, with the purchase of a fairly low cost video camera and video editing software, banks can now create and distribute videos through social networks in an effort to connect directly with consumers and obtain retail sales prices on their repossessed autos - and possibly provide the financing to qualified borrowers.

After exploring its options, Pan American Bank (my employer) in Los Angeles initiated a social media-based program that distributes videos on YouTube, Facebook and other platforms to publicize its repossessed used autos. Through the use of in-house videos, Pan American Bank is able to achieve several goals:

Publicize the sale of its repossessed autos directly to retail buyers, reducing/eliminating the losses experienced from wholesale transactions.
Create a following among consumers seeking quality used autos.
Increase the Bank's visibility.

As the cost of video equipment and video editing software has fallen sharply (most cell phones provide video capability), many individuals have become pro-am videographers. If your organization has little to no budget, a great place to begin a search for a video expert is within your organization. A simple e-mail blast to employees asking for experienced videographers may result in one or more in-house resources. This will reduce costs and increase flexibility. If an in-house resource is not available, inquire with students at local high schools and colleges. Finally, call on video services. If budget is not a problem you may want to seek a professional right away. However, you may be pleasantly surprised at the quality of employees.

Social Media's Tortoise and the Hare

2011-11-13T23:46:00.000-08:00

We've all heard the Aesop fable of the Tortoise and the Hare. In the story, the hare, speedy and full of bravado, fails to win the race against the slower tortoise.

The financial services industry is undergoing its own version of the fable with respect to social media. On the one hand you have firms such as Chase, giving away $1 million dollars through Facebook. On the other hand you have firms such as Morgan Stanley, reluctantly entering the world of social media by getting every tweet, LinkedIn post and other social media comments pre-approved by "corporate" before making the messages public.

While it is important for every firm to understand the influence of social media, it is just as important for every firm to do it in a manner that is consistent with the culture and governance style of the firm. Some firms, such as Chase, are very comfortable jumping into social media with both feet. We'll call them the hare. This is a function of the culture at Chase. Some firms, such as Morgan Stanley, are more comfortable taking calculated steps. This too is a result of the corporate culture. We'll call them the tortoise.

Unlike the fable, this is a race where there is likely no loser. What is important here is that organizations move into social media at a pace at which they are comfortable. As stated on this blog many times; most important is for firms to actively "listen" to social media to determine what is being said so that appropriate responses can be provided. Beyond listening (which IS mandatory for all), every firm should move at a speed at which they are comfortable.

Some firms will train and trust their employees as brand ambassadors and unleash them to do their thing on social media. These firms will have no problem sleeping at night. Other firms will limit employee access to social media and will screen and pre-approve all messaging. For these firms, this is the only way they can sleep at night. While social media proponents will push for the former, the reality is that either approach will work. What is important is that the firms implement something in order to remain visible and competitive.

The Age of the Thick Skinned Banker

2011-11-13T00:02:00.000-08:00

Amplicate, a social media analytics company, released a report that suggests that banks need to develop thick skin, really thick skin, in the new world dominated by social media.

The Amplicate study revealed that 83% of opinions about major banks in the US and Europe were negative over the past 12 months. The study focused on large money center banks and not on the smaller community banks. While community banks would have likely performed better due to their reputation as being more consumer-friendly, the lesson is the same: bankers need to learn to deal with and manage criticism like never before.

Social media makes it easier than ever for consumers to make their complaints public. Look at Bank of America's recent social media troubles related to its $5 debit card fee. The public outcry resulted in a complete about face by Bank of America and created significant damage to the Bank of America brand that will take some time to repair.

Banks' knee jerk reaction may be to avoid social media altogether in an effort to avoid the criticism. However, as has been repeated many times on this blog, the criticism will occur regardless of a bank's stance on social media. A better approach is to play offense and implement a social media monitoring system that tracks what is being said about the bank and responds in a transparent and honest manner in a effort to prevent the criticism from snowballing in a manner similar to that experienced by Bank of America.