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The Magic Behind Customer Innovation

Social Media Energizes Traditional Banking Strategy

Created in 2005, Boubyan Bank is one of the fastest growing banks in Kuwait, with a wide range of products and services in consumer banking, corporate banking, and investments, including Islamic banking offerings.

As a Deputy CEO in charge of consumer banking and banking operations groups, Abdullah Al Najran formulates business strategies and policies and is closely involved in the planning and execution of operational activities. He is also a key advocate of learning and innovation culture, which continues to be the major focus of the bank's strategy. Here he shares his thoughts on the intersection of traditional and innovative forms of customer strategy, specifically social media.

Customer Strategist: Why are customer strategy and innovation important to the company?

Abdullah Al Najran: The customer is at the center of everything we do and our customer strategy focuses on providing differentiating products and the best quality service to our main target segment of affluent Kuwaitis. We have also identified the potential of other strategic segments, such as youth and ladies, for which we developed compelling value propositions that would appeal to new customers, as well as retain the existing ones.

Innovation takes the bank's signature customer experience to the next level as we strive to continuously exceed our customers' expectations. We have embarked on a transformation journey and are in the process of implementing various customer-centric initiatives, such as upgrading the call center with biometric features such as automatic customer voice recognition, revamping our website for superior digital experience with "chat" and enhanced Internet banking features, focusing on social media as a market differentiator to engage with our customers on a more personalized level, amongst others.

Essentially, the customer strategy defines the "wow" experiences for our target customers, whereas innovation ensures that we keep delivering on the Boubyan promise in line with our customers' ever-changing needs and preferences.

CS: What potential is there for banks to advance their customer strategy through social media activity?

AAN: Social media has become the primary channel of communication for young, digital, socially savvy customers. Banks need to adapt to this trend in order to build credibility and trust with this segment. Social networking sites are where youths of today gather to socialize, be entertained, share stories, seek advice, and prefer to have their complaints and questions answered. Consumers view social media as the platform for meaningful engagement through on-demand content customization, sharing and collaboration, all of which banks can leverage to build trust and create opportunities to grow their customer portfolio.

If positioned correctly, social media can be a very effective customer acquisition and retention tool. First and foremost, social media marketing is a far less expensive option relative to traditional media, such as TV, radio, billboards, etc. Social media is also a well-positioned platform to build superior relationships with customers, as banks have a direct path to interacting with the audience to gather immediate feedback on the products and services. People can immediately "like" the product /service, comment on it, share it with their friends. This "know-like-trust" cycle with customers and prospects will ultimately lead to revenue growth through new acquisitions and repeat business.

CS: What type of social media activity do you think holds the most promise from a business perspective?

AAN: The key to social media success starts with "listening" across all social media platforms to what is being said about the brand and products, competitors, and following industry trends. This gives insight on customers' and prospects' needs and preferences, which guides communication and engagement efforts in order to create high brand awareness and keep the brand top of mind for consumers.

With a social media monitoring tool in place searching for brand and product mentions, banks can identify customer service issues as they come up, even on fast moving social networking sites like Twitter. Furthermore, a good listening program can proactively manage the brand's reputation and in the case of a crisis, mitigate the potentially negative effects on the brand by responding quickly and properly according to the corporate crisis response plan.

CS: What social lessons from other industries can help banks with their social initiatives?

AAN: Focus on business outcomes—most banks are using social media channels merely to push messages out. Social platforms offer a golden opportunity to engage with customers in a two-way dialogue and to create an emotional bond with the brand. Customers can also become the most significant source of innovation—banks need to embed social capabilities in the business processes to continuously collect customer feedback.

Change starts from within—social media adoption requires transformational change, so dedicate a social business team (comprising representatives from relevant business groups) to act as change agents to build awareness and drive the adoption across the organization. [Boubyan is in the process of defining an employee transformation program to start down this journey]. Furthermore, banks should empower their employees to become brand ambassadors and leverage them to grow the network of followers and external brand evangelists.

CS: What do you think are some of the biggest roadblocks to banks' use of social media as a relationship channel?

AAN: I believe the biggest challenge lies in maintaining customer data privacy in terms of the extent and scope of customers' information being shared over social media platforms. These platforms are typically provided by external third parties, which means that data is stored on the provider's servers. Naturally, banks are very uncomfortable with such a set-up, since regulations dictate that customer information of a sensitive or confidential nature cannot be stored outside of the bank's systems.

So when a customer makes a complaint about a bank on Twitter, for example, the bank needs to shift that conversation offline and typically asks the customer to contact the call center or a direct number to the bank staff member. The challenge becomes when a customer does not necessarily want to call the bank on the phone. Banks need to look for alternative online solutions to address this issue. One way is to direct a customer to a click-to-chat tool with a live agent that resides on the bank's servers and provides a secure environment over which to share personal banking details. Live chat is something that Boubyan will implement in the near future, not only to resolve customer complaints but also to engage in informative discussions.

CS: How should a bank balance social media activity with the rules and guidelines of Islamic banking?

AAN: Social media and Islamic banking are not conflicting; indeed social media is a channel like any other and the same rules and guidelines of Islamic banking apply across all customer touchpoints. Since customers and users interested in Islamic banking are generally more conservative, there are additional guidelines that apply in the social media space with respect to moderation and stricter filtering of the language used (tone / content) and photos shared. The flexibility in interaction should be there, but with clear redlines not to cross.

CS: What is the biggest challenge you see to social media expansion?

AAN: Customer perception and experience of the bank's brand can be relatively easily swayed by the conversations taking place across social media channels, which we have very little control over. That's why we felt it was important to invest in establishing clear governance and social media policies to enable us to respond quickly and communicate in a manner that is aligned with our brand values and consistent across the channels.

Another area that we needed to address was how to manage employee communication through their personal accounts. Since we encourage our employees to get involved in social media adoption and innovation, we also invested in developing clear social media guidelines for staff to avoid any public embarrassment and liability with any potential miscommunication.

CS: What would you say to other banking executives looking to expand their customer initiatives into social channels?

AAN: Start with the solid governance to guide your decision making and oversee social media activities in an efficient and effective way. Build internal policies for your employees to follow to ensure consistency in branding, communication, and customer experience across all social media platforms. Furthermore, building engagement on your social media channels requires active listening so invest in a good social media monitoring tool. Understand where your target customers are gathering, listen to what they are saying, and finally provide them with content and propositions based on their needs.