Twitter, blogs, chat rooms, Facebook and many other services are designed to foster communication and generate online conversations. Banks have been trying for years to harness these evolving formats.
Some recent, high-profile examples have shown that it is relatively easy for banks to send out messages to the whole world. What is unclear, however, is how effective these messages are: Do they lead to a series of useful interactions or just create more online noise? Executives say that narrowly focused services may be more effective at reaching specific customer groups.
The staff of the global financial cooperative Swift tweeted through its annual Sibos conference last month, using Twitter Inc.'s microblogging service to deliver short updates about the event to participants.
Andrew Carrier, Swift's head of marketing communications for banking markets, said the Twitter feed attracted 928 followers and Swift employees produced 440 tweets — recipients generated many more in response.
But Carrier said Swift's experience demonstrated both the potential and the limitations of social media. The value comes from triggering interactions. "That, to me, is the wonderful power of social media: user-generated content," he said. "You get people involved in a discussion around your subject matter."
However, the open nature of Twitter also proved limiting because the feed was aimed largely at exhibitors, reporters and analysts and consisted mainly of nuts-and-bolts details about the Hong Kong conference — updated on schedules, for example — rather than information about the high-level payments issues being discussed or how financial companies could put these ideas into practice.
"People are not necessarily comfortable sharing their ideas in such an open forum," Carrier said. "Banks are not necessarily very comfortable yet with the technology."
But Swift has been more successful at encouraging financial executives to interact online through Swiftcommunity.net, a quasi-private networking site that the cooperative — formally the Society for Worldwide Interbank Financial Telecommunication — introduced at the 2007 Sibos conference, Carrier said.
"It was designed from the outset as a social media site," he said. "As a result, it's a lot more involving."
The community site, with its collection of blogs, message boards and automated e-mail updates, has attracted 11,800 registered users and now incorporates 200 communities, Carrier said.
Of these, 40 are public to anyone on the Internet, he said. By contrast, the site includes 120 private communities set up for users with a specific business purpose, even one bank setting up a Swift connection with another. The remaining 40 sites operate on a hybrid model, private but visible, where anyone can view the message boards but can participate only after being admitted to membership.
Swiftcommunity.net has emerged as a destination where bankers can raise important issues with their peers, especially technical discussions of payments policies and other Swift-related issues, Carrier said. "We have an ambition to make it a place where higher-level industry issues are discussed."
Stessa Cohen, a research director at Gartner Inc., said bankers are simply being prudent in using closed communities.
"It reflects the cautiousness that bankers have about discussing banking issues in a public way," she said.
Especially for those who are just entering social media, the limited approach gives users a way to develop a degree of comfort with the medium, she said. "If it's not comfortable, the conversation will be stilted, and nobody will participate. That's not good."
Success also requires buy-in from top management and a recognition that social media will become a more important forum for bankers, she said. "There has to be support in the organization for this kind of communication, even in a closed community."
