Social networks, and evolution of internet into a social media platform presents a big challenge to Banks because the elements of social media are the antithesis of traditional Banking, which is based in secrecy and confidentiality. This pervades Bank culture, which makes it hard to come to terms with how to lever the positive changes that are happening, and to ensure they, the Banks, remain relevant.

This report does a great job in a couple of areas.

1. It lays out in practical terms the current state of Social Personal Finance, with tons of examples
2. It describes various tactics for entering the social media space, varying from ‘proven’ all the way to ‘uncharted waters’

The tactics described, are described in depth, with pros and cons for each, and includes cost ranges for various tactics. Finally the size of the space, with predictions for numbers of households participating are laid out for several years. Jim has been in the prediction game for many years, and I would characterise him as conservative. There is more than enough here to work on business casing your tactics.

Relevance to Bankwatch:
One of the challenges for Banks (and credit Unions) in these disruptive times is not just in understanding the changes that are happening, but relating them to their own business strategies in a meaningful way without sounding like a complete lunatic in front of the powers that be.

At the end of the day, each FI needs to decide whether to participate, and after that, participate at what level. Personally, i believe to not participate at all is out of the question. Even if participation is only monitoring blog posts about your FI, at least its a start.

I recommend this report to help categorise the opportunities, and distill the many different types of opportunities into meaningful and understandable buckets, that will help you lay out your road map.

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Technorati tags: Social Lending

Technorati tags: Banking Strategy