In today’s economy, the importance of remaining innovative and proactive, rather than simply reacting to market conditions, is greater than ever. Part of this is focusing on driving banking innovation by the use of social media, in order to extend the reach and productivity of all banking operations. However, in order to determine if the banking strategies are optimal, it is necessary to evaluate them, using soft Key Performance Indicators (KPIs).
Unlike “hard” KPIs, or those KPIs directly tied to immediate, quantifiable financial benchmarks, soft KPIs involve a longer-term process of evaluation, one based on social and personal evaluations. This is especially true in the case of social media, involving large groups such as the bank marketing association.
These KPIs can include direct measurements to determine how many individuals are being reached by the social media campaign. An example would be how many individuals are signing up to the social media networks such as Facebook. However, while easy to evaluate, these may not be the best indicators of the reach of the advertising campaign.
More effective soft KPIs might involve focusing on customer comments, via the social media and what their comments, whether positive or negative, focus on. This would allow the bank to determine what their customer base is most interested in, and what areas they feel could use improvement. This is especially beneficial, as tracking comments would allow the bank to focus on those issues that are most important to their customer base.
Secondly, in evaluating comments and user participation, the bank should try to establish methods to make the sharing of consumer opinion easier and more effective. By allowing a streamlined comment or discussion process, banking innovation can be fostered at all levels of the institution.
Finally, whether as an individual bank or part of a bank marketing association, the evaluates need to remember that soft KPIs are just that-soft, and will not always provide unambiguous data. Determining whether a spike in customer comments represents a genuine change in opinion or simply the activities of a few energetic users often requires a subjective judgment on the part of the evaluates.
Banking innovation via the use of social media is a powerful tool for modern financial institutions. By making use of soft KPI metrics, a bank can effectively prepare itself to face a fast-moving business future. Think about defining the right metrics for your business and then apply them conservatively for best results.