Thousands of credit unions around the world use Facebook but cybersecurity troubles at the tech giant and shifting consumer preferences may be cause for some institutions to rethink their strategies.
Still in the headlines following the Cambridge Analytica scandal and its role in spreading fake news during the 2016 election, Facebook announced late last month that a data breach revealed the private information of nearly 30 million users. Taken together, “I think people are rightfully questioning the authenticity of their interactions on the social network as well as the integrity of the news and information it curates,” said Emily Blout, a cybersecurity expert who formerly worked with the National Security Council and doubles as an assistant professor at the University of Virginia.
The social media behemoth’s regulatory filings indicate its worldwide user base continues to grow, but a
To be sure, deleting the app is far different from deleting an account, but it does mean potentially far fewer consumers – especially younger ones – are seeing credit unions’ Facebook posts. According to Bo McDonald, CEO of Your Marketing Co., a South Carolina-based credit union marketing firm, CUs aren’t pulling back from Facebook just yet, but “there is a shift to other platforms (Instagram, etc.) as demographics change, but it’s only to make sure content is placed in relevant places and not so much based on the scandals” that have plagued the company.
And some credit unions are changing how they utilize Facebook, though not entirely due to cybersecurity issues.
Tennessee-based Old Hickory Credit Union pulled back from Facebook nearly 18 months ago following shifts in how consumers use the site.
“People have become a bit more cautious of putting information out on Facebook,” said CEO Bonnette Dawson. “When you begin to see a lot of criticism [on the platform and about the platform], we decided that it wasn’t the best avenue.”
Instead of Facebook, explained Dawson, the $233 million-asset credit union is focusing on strategies like email blasts, in-app communications and more.
The way consumers use Facebook has also changed dramatically in recent years. What used to just be a site for connecting with friends has now become intertwined with business, politics and more.
“Facebook has become a search engine where people research brands as well as a review site where users can see what friends and neighbors have to say about a credit union or other business,” said Marne Franklin, CEO of Uncommn, a social media consulting agency for small businesses, civic organizations, credit unions and community banks.
Should CUs abandon ship?
Even if Facebook fixes its cybersecurity issues, users’ trust already may be broken, but analysts said credit unions should stick with a multi-platform strategy moving forward.
“Don’t put all your eggs in the Facebook basket,” said Jason Falls, a social media analyst and director of digital strategy at Cornett. CUs, he said, need to ensure they’re “developing a direct line” with members, but that can be done through email, apps and texting – not just social media.
Other analysts are urging credit unions not to pull back, noting that as long as CUs aren’t putting member data onto Facebook, they aren’t at risk from the site’s cybersecurity woes.
“There’s a huge risk of not being on these platforms,” said Meredith Olmstead, CEO and founder of FI GROW Solutions, a consultancy formerly known as Social Stairway. “Conversations about your brand are taking place online whether you like it or not.”
On top of that, many sources added, Facebook is so dominant in the social media space that it’s highly unlikely any of its competitors will usurp it as the go-to medium. Though some media specialists have pinned Instagram as the next big social platform for small businesses to utilize, Facebook owns Instagram. LinkedIn remains another option, though UnCommn’s Franklin said that site still hasn’t reached the point where it can replace Facebook as a first resource for communication.
Too big to fail?
Another lingering problem for some CUs is that Facebook has been so big for so long that migrating to other services would vastly decrease how well the institution can get its message out.
“In terms of using other platforms, we do use Instagram, but have not delved too deeply into using LinkedIn or Twitter," said Amy McGraw, VP of marketing at Tropical Financial Credit Union and a member of the CUNA Marketing & Business Development Council’s executive committee. "We haven’t put more into Instagram as a result of the [Facebook] breach and have not noticed any declines in engagement with our posts or our ads since the breach."
So what will it take for consumers – and, by extension, financial institutions – to drop Facebook for good?
According to Falls, “The line that will tow customers away is when an individual's financial life is affected,” though he added that users can simply opt out of Facebook’s financial features and continue to use other functions of the service.
“Facebook will try to build applications within its ecosystem to change and prove that, one day, we will feel good about putting our financial information in some type of Facebook application,” he added. “But for now, we need to realize that Facebook is great for superficial [impersonal] communication, but we need to open up other forms of communication with customers.”
