Facebook’s recent bad press regarding privacy changes on their site and reported leaks of customer information contribute to a growing concern among users. The uproar also underscores what Forrester and our clients have known for years about security and privacy online: they are the bedrock on which solid online (and mobile) customer relationships are built. Nowhere is this more important than with financial services customers.
It comes as no surprise, then, that 71% of online consumers surveyed by Forrester say they have little to no interest in accessing their bank accounts through social networking sites like Facebook. What is the number one reason why? Security concerns. Number two? Privacy concerns. Seems like FarmVille and financial services just don’t mix. Perhaps more surprising, though, is the 17% of respondents who say they are interested in accessing their bank accounts via social nets.
The real question is how interested are these consumers’ financial institutions in offering account access through Facebook and other social networking sites? As financial firms today look for every opportunity, in every channel, to deepen their relationship with their customers, it’s hard to ignore a community with a 30-day active population of more than 400 million users, 50% of whom visit on any given day.
As financial institutions begin to look more carefully at how to tap into consumers' enormous interest in social networking sites to better service, cross-sell, and up-sell their customers, it’s critical to understand consumers’ concerns and how to mitigate them, while still taking advantage of the rich interactions these sites engender.
This morning Microsoft launched SharePoint 2010, the follow-up to the very successful Microsoft Office SharePoint Server (MOSS) 2007. As the morning progresses, I receive more and more notifications from vendors that are announcing integration strategies for the new offering. Meanwhile, other vendors announce strategies to compete. The social computing vendors are no exception. No matter the strategy, it's clear that SharePoint is creating a market disruption that not only vendors but clients need to address in creating and updating broad collaboration strategies. Many Forrester clients have already begun this assessment process, as evidenced by my inquiry load over the past several months. One question has surfaced repeatedly:
Does SharePoint 2010 affect my plans for social in the enterprise?
Well, yes and no. Here's the 100,000 foot view. If you are committed to SharePoint you really need to take a look at what Microsoft delivers as part of 2010. For many, this release will reach the proverbial "good enough" bar. MySites, already a decent profiling service, continues to improve. Blogs and wikis, which were pretty dismal in MOSS 2007, are quite well done. Key missing elements like tags, tag clouds, community sites and activity streams are now part of the offering. Microblogs, a hot top of mind topic at the moment, are not quite there yet. Interesting. As Twitter explodes and Yammer continues to gain ground in the enterprise, SharePoint comes up short in microblogging. The reason? At least for the time being, SharePoint is dependent on a pretty traditional development cycle and microblogging exploded pretty late in the product development cycle. In other words, SharePoint is now clearly in the social game, but will play the role of fast follower for the time being.
In the mid- to late-90s, many business leaders observed the advent of the Web and asked the wrong question: “What will the Internet do for us?” Instead, they should have been asking, “What will the Internet do to us?”
The difference between these two questions is the difference between a false sense of security and a necessity for action. It’s the difference between Amazon organizing itself around the online channel in 1994 and Barnes & Noble opening an e-commerce site in 1997—today Amazon is worth $55.7B and Barnes & Noble has a $1.1B market cap. It’s also the difference between newspapers struggling with a 70% decline in classified advertising over the course of a decade and eBay seeing revenues increase over 1900% in the same period.
Today, many business leaders are again asking the wrong question: “What will social media do for us?” instead of “What will social media do to us?” The difference between those two questions will define the business winners and losers of the next decade. Let’s explore what social media already is doing to business and how organizations must adapt.
Over the last few years, I think most would agree that leading product development organizations have gotten much savvier about designers collaborating with internal stakeholders – such as manufacturing, sales, and marketing – to harness contributions and feedback from more business perspectives, get the product right the first time, and ultimately better transform technical inventions into market-relevant innovations. What’s really interesting is that, over this same period, the social Web – which Forrester calls Social Computing and includes peer-to-peer activities like social networking sites, blogging, user review sites, wikis, podcasts, and other user-generated content – has steadily grown in popularity among consumers as well as expanded its presence among manufacturing enterprises. The question is, will these new technologies and corresponding social trends make their way into product development organizations and – once again – transform the way leading product development teams collaborate to bring great products into the marketplace?
In short, I think so. The fact is, the increased prevalence of Social Computing presents product development with some compelling new capabilities:
Even though there's plenty of evidence showing the positive impact many companies are getting from leveraging a social media strategy, there are still companies rigidly refusing to develop a social media strategy. This reminds me of the early days of the Internet: there were those companies looking to embrace the Internet and develop a new kind of "e-business," and the rest, steadfastly refusing to believe the Internet would transform their business. Even as Amazon defined a new online shopping channel in retail it was amazing to see how many large retailers were slow to establish an online presence.
Back in 2000 I wrote a report urging online retailers to embrace “community” as one of three core elements of their customer strategy. Companies such as REI, which already had an online community in 2000, have learned from their experience and are surging ahead into new social media.