Should banks rely on social media for conflict resolution?

Financial institutions have relied upon social media services to improve and modernize several areas of their operations, including advertising and marketing, customer service and sales. However, where should banks draw the line when it comes to their use of social media? Some analysts argue that using these portals for conflict resolution is going too far.

In recent years, more banks and credit unions have incorporated these social channels into all areas of their business because it allows them to more quickly address issues, collect feedback and create a more personalized relationship with customers. However, those that use social media to resolve customer complaints and issues may face a backlash and inadvertently harm their reputations.

First, social channels, such as Facebook and Twitter, are public forums, which exposes issues that financial institutions may only want to deal with on a case-by-case basis. The power of public opinion and its influence on the financial industry has been demonstrated many times, ranging from the mass exodus of customers on Bank Transfer Day to many banks’ decision to drop fees after consumer complaints. By giving more customers the room to publicize their negative experiences, banks are not only airing their missteps, but also inviting the audience to scrutinize how they resolve the conflict, according to the Financial Brand.

Second, many issues customers may have are unique to their particular circumstances. Some of these problems may be complex, and trying to resolve them on a Facebook or Twitter feed can be limiting and frustrating for customers. In addition, it may suggest to them that banks are not fully dedicated to trying to work out a solution if they are unable to reach a representative by phone. For this reason, assigning an individual bank representative to customer issue may help the resolution process go more quickly.

Lastly, discussing sensitive issues on public feeds may violate compliance rules, which can land financial institutions in hot water. Instead, banks dedicated to using technology for quick conflict resolution may consider simply using existing channels that are more secure, such as online chat, rather than social media networks, the news source suggests. This affords banks more control over privacy and security settings. Further, this method can be quicker than social media channels, as speaking with an online representative can correct issues within minutes as both parties are engaged in the conversation.

Leave a Comment