Chinese Banks & Web 2.0

Analysis by Garry Ren, Jan. 2012 HongKong

Event

November 7, 2011, as the representative of China’s major banks, three top Chinese banks (CEB, CCB and ICBC) made almost simultaneously published the 2012 IT budget and project framework. The major bank’s New Year IT projects focus on the development and use of social networking area with huge budget. Mainly includes social network call center, the potential user mining, public opinion supervision, etc.

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Data Source: China Internet Network Information Center, 1 Jan. 2012

Analysis

According to China Internet Network Information Center (CNNIC) released the statistical report in January 2012, by the end of December, 2011, in china, the blog / space with users 319 million, compared with the end of 2010 increased 8.2%, the utilization rate of 62.1%. As the first web2.0 application, the users still keep growth though the utilization rate fell 2.3% by the end of 2011. Microblog users reached 250 million, representing an increase of 296.0% contrast last year, and the utilization reached 48.7% that means nearly half of Chinese Internet users to use Microblog. About 244 million peoples use social network, a slight increase compared to the end of 2010.

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Data Source: China Internet Network Information Center, 1 Jan. 2012

Mature western social websites have revealed a great power and potential of development, but in China, The western social website had been locked, and the local social website actually still keep in mist without a successful model, especially the platform is not mature enough, but No one doubts after the combination of the innovation for Chinese user’s psychological characteristics and communication methods, and a long time training accumulation of user habit. China Social Network market is a large market with a lot of variety opportunity within several years. On the other hand, the Chinese government is very concerned about the issue of information dissemination and communication control. In fact, the new real-name policy for Microblog has been introduced in late 2011 that mean the government supervision for social networks will result the important impact in the future.

Based on SNS concept, social network has gradually become one of the main areas for Internet users with a large number of users and information exchange, the information “viral” extended transmission in a very short time. Under the network environment, more and more bank’s user almost choose social network as their first choice to share experience, report problem and discuss new requirement about the bank products and services, including E-bank, Payment, Credit Card and Interment Product, etc, rather than call into customer support phone lines from traditional Telephone Call Center when they have woes to solve. But the information includes not only the positive information, but also contains negative information. Therefore, for Traditional Call Center, the basic function service and marketing become very limited.

1) Without user’s information from social network so that the requirements from end user can not be received and satisfy, and the existing bank products and services can’t be upgraded and optimized in time.

2) The negative news out of control ability, the bank’s reputation and image will be damaged once the negative news dissemination.

3) Bank will miss the potential end users and business development opportunities.

4) The end user’s psychological characteristics and behavior change, the number of users from traditional call center is relatively insufficient, that means the traditional Call Center operating cost overruns compare the actual results.

5) The complex information in social networks is difficult to identify by the bank.

Banks should address these pressing issues, upgrade the traditional call center and respond to this market changing with a new model and tools.

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Recommendations

1) Set up the Social network information listening system and effective monitoring strategy so that first listen to customers where they already are catches up the related information at the first time. And Set up the Analyze and filtrate system, let bank quickly sort and filter the information from first step and respond in real time.

2) Train Call Center Team and set up Social Network Call Center workflow and KPI.

3) Allow ease of Knowledge Retention, Knowledge Management and Data Mining.

4) Allow future use of Social CRM and automated-decisioning.

5) Allow Customer Experience Management Framework with controllable KPI’s in place for benchmarking.

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