Soc biz and what it really means for the finance industry

On Wednesday, I was at Finextra’s Social Media Day in London where Ross was moderating a panel on social data.

The most interesting part of the day for me (surprise, surprise) was the panel discussing social business. Social business in the finance industry is fascinating because the two terms together are a bit like chalk and cheese.

So what role does social business have in the finance industry?

I think the fact that banks and social don’t really fit together at the moment says a lot about the opportunity for banks to become intrinsically more social.

One of the guys on the social business panel was Giles, CEO of Zopa (you know – that p2p lending service).

He started talking about trust and, for me, this is fundamental in becoming a social business. And, for banks, this is arguably their biggest obstacle.

Giles said that customers used to trust their banks because they are giant secure buildings with massive safes and cctv. This is ‘hard trust’. The thing that customers didn’t buy was that the bank had their best interest at heart, which he referred to as ‘soft trust’.

Recently that ‘hard trust’ has started disappearing too, as consumers started realising that their cash wasn’t actually as safe as they thought. This is why new people-centric start-ups like Zopa are becoming incredibly successful and are starting to threaten the traditional banks – because they are building ‘soft trust’ and are gradually gaining ‘hard trust’ as they grow and develop.

Of course, this is great for small, agile companies such as Zopa.

But what about the larger  banks who are under constant criticism by the wider  society?

This was something the panel didn’t go into much detail about and I think that’s because the term social business is still being thrown around without much meaning attached to it.

When we talk about social business, we mean making social fundamental to the way the business runs.

This means getting more people involved in the creation and development of products and services, but also listening and learning from people within and outside the business to help it evolve.

This is the real opportunity for the financial services industry. There are some examples within the industry where brands have taken small steps towards this end goal – crowdsourcing customer feedback using first direct Lab, customer service teams using social at Barclays, internal collaboration at Citi and IBM’s employee blogging culture for example.

Of course, any steps towards the wider socialisation of the business within this highly controlled and restricted industry are great leaps towards progression.

(Thanks to GViciano for the image)