Twitter jitters
Banks are reaching out to potential and existing customers through social media, but they are in no rush and caution is the watchword
It took less than 140 typed characters to wipe US$140 billion off the value of US stocks last Tuesday. After hackers broke into Associated Press' Twitter account and tweeted that there had been two explosions at the White House, injuring President Barack Obama, the markets went into a tailspin.
Within minutes of the false tweet, Twitter suspended the account and both AP and the White House confirmed that it was a hoax. But the message had already been retweeted more than 3,000 times, sending the benchmark S&P 500 index down almost 1 per cent.
Behold the power of social media.
Banks are circling this puzzling yet powerful medium. They want to use Facebook, Weibo, Twitter and the like to connect to their clients. They understand that young people use social media, and that it's a great way to reach out to them and recruit them as customers.
Marketers and communications specialists see social media as the next frontier, and believe failure to shape a strong social media strategy puts them and their clients at risk of getting left behind. Nevertheless, banks are deeply ambivalent about it.
Yet there are some good examples out there. Industry insiders say American Express and Citi are firms that get Twitter right.