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.
Facebook is currently the world's most popular social media site, with over 400 million users. Long-plagued by accusations of security leaks and lackluster privacy practices, the corporation is currently defending itself against a barrage of new criticism. CEO Mark Zuckerberg gave an interview earlier this year arguing that privacy is no longer a "social norm." Facebook privacy policies have been rapidly shifting to reflect this position.
The latest firestorm centers around a new feature called "instant personalization," a targeted advertising service that supplies personal user data to advertising partners like Pandora and Microsoft Docs. All Facebook accounts were included in this service when it was rolled out, and opting out is a convoluted, multi-step process. In a move that some users are calling deliberately deceptive, simply clicking an "opt out" check box does not protect your user data from being shared.
So far, the beta service is limited to three corporate partners — all of whom have promised not to behave inappropriately with the shared user data — but the feature is slated to be expanded over time. This puts millions of user accounts and their personal information at the mercy not just of Facebook, but of the ethics of every company that becomes an instant personalization partner in the future.