Social media channels emerged in the mid-2000s as a means for ‘friends’ to communicate and gradually developed into platforms for people to get informed as well as for companies to advertise their products.
Apart from the hundreds of millions of individuals using social media every month, numerous businesses have created accounts and developed their own digital communities.
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Leasing Life’s research on the use of social media by lessors operating in Europe finds that nearly three in five (59%) companies, from a sample of 180, have an ‘active’ account on at least one social media website. This means that a considerable share (41%) of lessors either has not created an account or they have not used it in the last 12 months.
The research reveals that independent lessors and captive finance companies are more likely to have an account compared to bank’s leasing and asset finance divisions, which are usually shared through the bank’s social media channels, mixed with updates on other units.
In addition, a North-South divide is evident from the figures, with only a small number of South European lessors having a dedicated social media account.
Out of the companies with a social media presence, 64.5% have an account in more than one social media channel.
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By GlobalDataThe ‘appropriate’ social media channel
According to Leasing Life’s research, the most popular social media platform for the leasing industry players operating in Europe is LinkedIn, with 46.7% of lessors having an account. The research shows that the average LinkedIn community stands at 5776 people, substantially higher than any other social network.
GE Capital is among the companies whose social media strategy is focused on LinkedIn and managed to create a community of more than 250,000 members, substantially higher than any other company in the sector.
Global leader of digital marketing strategy at GE Capital Joe Miranda explains why LinkedIn is the most appropriate social media channel for the business.:
"LinkedIn has been the most appropriate for us to commit to, because our customers are typically on it. LinkedIn is a tremendous platform for content and editorial which is both broad-based and industry-specific."
Head of digital at Bibby Financial Services (BFS) Matt Reid believes that the appropriateness of a social media channel depends on each company’s objectives. Reid finds Twitter more "customer-focused", as it allows companies to engage in a dialogue with their customers.
According to the research, Twitter is the second most popular social media channel for lessors operating across Europe, as 41.7% of the companies have an account and the average community size is 1541 members.
Interestingly, in the UK Twitter is the most popular social media platform for leasing companies, with 74.2% of them choosing to have a presence compared to 62.9% which have a LinkedIn account.
Despite the fact that Facebook is the world’s largest social media platform with 1.55bn monthly active users – as of September 30, 2015- only 21.7% of lessors have an account and the average community consists of 1313 people.
Although GE Capital has not heavily focused on Facebook, Miranda characterises it as a "tremendous avenue" to produce and tailor content in order to target a very specific demographic.
Miranda says: "Facebook gives users the ability to select different types of profiles, segments and behaviours. It also has fantastic measurement tools to track success and its network is significantly broader than other platforms.
"I do not think it is just for consumer package goods (CPG) brands. I do think there is an opportunity from a financial services perspective, but maybe more on the business-to-consumer (B2C) side of the market. It is certainly an environment that companies should be testing and learning on a constant basis because there is a real opportunity there."
In order to share content in a variety of formats, a number of lessors have been producing videos. These videos are often on case studies, outlining the characteristics of the funding line and featuring interviews with lessees on their experience working with the company. Some leasing industry players also upload animated visualisations of research data and video interviews with their executives.
Youtube is the most popular platform to upload videos and has a large global reach. Leasing Life’s research shows that 15% of lessors operating in Europe have created a YouTube account.
Is social media presence important?
"For us it is definitely important. It is another way of getting our name out there and driving brand awareness. I think that is probably true for a lot of companies. It is one of the ways a company can reach its target audience," says ?vice president of digital marketing and social media at CIT Carolyn Menz.
The key role of social media in brand creation and strengthening is also highlighted by Miranda, who says that we have reached an age that social media is used by customers to form an opinion about companies.
"I think it is already a place where people are judging brands. The customer now is empowered, they control their own journey. They control how, where and when they want to connect with a company," says Miranda.
Reid adds that most of customers’ evaluation of a company is done through digital channels, – including social media,- and says that nowadays companies are not really in control of the first part of the purchase funnel.
As brands can be judged via social media channels, lessors focus on communicating their breadth of knowledge and expertise.
Miranda says: "Our main goal on social media is to deliver value and to show that we can provide positive customer outcomes and that ‘what we know can help you grow’."
Some of the content shared can be viewed by anyone using that particular channel, as a result a company can reach a wider audience. At the same time through group discussions and marketing tools, lessors could reach a specific target audience.
Menz says that the ‘key’ benefit of social media is the ability to reach niche target audiences that companies are not necessarily able to get to through other channels.
Apart from reaching different types of audiences, through social media companies can interact with them.
"Digital in general provides you with the ability to have a one-to-one personalised relationship with the segments you are trying to reach, whether it is customers or employees or other experts in the industry," says Miranda.
There have been examples where discussions on these digital channels have led to new business opportunities for lessors.
Describing one case where a sales lead arose from social media at BFS, Reid says: "We listen to conversations around specific keywords – for example leasing or trade finance. Once we saw that somebody had some issues with a large bank, so we felt it was appropriate to interject and say ‘if you would like to have a different view then we will be happy to have a conversation with you.’
That person actually came back quite positively, we got in contact with the individual and had a discussion about the types of finance we offer."
Miranda tells Leasing Life about a big fleet deal that originated from social media: "This happened in Europe, I believe it was in Italy. We had our experts participating in different groups on LinkedIn around the fleet industry and we sourced a customer who had no idea that GE Capital offered fleet services.
We engaged with that customer, took the conversation offline and eventually wound up in a deal for us. We have many stories of where LinkedIn or leads from Twitter have led to additional volume in our sales pipeline."
BFS recorded a 22% increase in enquiries via its social media channels in the first ten months of 2015, compared to same period in the previous year.
Despite highlighting that social media could be an avenue to attract business, Reid says that companies cannot expect to source hundreds of deals every month from social media. He also questions whether a business can change by having a social media presence.
"Are you going to change your business by having a social media presence? I think there are some companies, particularly financial start-ups that feel they can do that. It can make a business a lot more modern and a lot more alternative than a mainstream or traditional provider, but I don’t think you will get enough traffic by just having a really strong social presence to change your business over night," Reid explains.
Lessors are also using social media as a recruitment tool, advertising jobs and contacting potential employees.
The increased importance of social media for recruitment can be seen from Barclays’ latest TV advertising campaign ‘Barclays Lifeskills’.
A TV commercial named ‘How to use your hobbies on social media to get a job’ implies that an employer could look into applicants’ social media when making the decision of who to hire.
The advertisement says: "An employer can go beyond that piece of paper [your CV] and get to know you much better, and then call you for an interview or offer you the job."
Part of CIT’s social media strategy is dedicated to recruitment, with the sharing of relevant content. "We have worked with our Human Resources team to build up our presence on LinkedIn specifically around careers. If you look at our company page on LinkedIn we do have a lot of content generated for new hires and potential recruits," says Menz.
Content
When a company uploads content on a social media platform, it can be accessed by all the platform’s users – unless it is posted on a private group or account- and not just by its community. Companies aim to post interesting content for users to share in order to amplify its reach.
Reid says that a company should post content that is meaningful to its community rather than something which is part of their agenda. He says: "A company needs to find something that creates engagement and momentum. If it posts: ‘We have a new TV advert’, its followers won’t be interested."
Reid finds content on customer experiences and examples of how funding facilities have changed a business operation to be popular, while Menz says that content on employee volunteering initiatives and company culture tends to perform particularly well on Twitter and Facebook.
Visual content seems to be dominating social media, as account managers use it with the goal of capturing users’ attention.
"People want visuals. If you look at Twitter nowadays 70% of tweets have images attached to them. As recent as 18 months ago, 70% of tweets didn’t have images, so that’s the way things have come through," Reid says.
A type of visual content that seems to be very appealing to lessors’ audience is infographics.
Miranda says that infographics that provide industry insights or trends which are valuable to a company’s specific customer segment can ‘resonate extremely well.’ He adds that they could be used to drive traffic to a longer piece of content – a webinar, white paper or case study – which might take people to the company’s website.
"They might take people to your own website and start the journey of educating them, and maybe potentially driving them to sales," says Miranda.
Some lessors produce short videos and share them across their social media, although the sheer production cost deters many companies from this. Reid says that at BFS they are trying to find ways to reduce this cost while maintaining a high standard, as he said that in the past the company ended up spending "a lot of time and money" doing it.
However lessors need to be careful with the content they are sharing, in order to be in line with relevant regulation.
Reid adds that companies have to be cautious when using social media because it is easy for them to make imperative statements like ‘looking for best deal on lease’ as well as misrepresentative statements that they wouldn’t be able to substantiate.
Miranda says that companies also have to be very careful when they share customer information, in order to protect customer data and privacy. "We never share customer specific information unless it is approved by the customer," he adds.
Building a social media strategy
"In order to be strong and successful on social media you need to realise that it requires ample planning and research before launching any campaign, you need to make sure you have the man power and content resources to ensure long-run success," says Miranda.
Miranda explains that it is important for a company to plan a monthly editorial calendar, looking at what it wants to say around the industry, and constantly monitor its posts.
He says: "You can even post a piece of content once a week; you just need to be monitoring constantly so that when someone engages with that post or asks a question you are there to respond or direct to a sales channel if need be. So it is not that a company has to have a tremendous amount of resources, as much as that it needs to be very strategic and aligned with the content it has and its capacity to produce it. It doesn’t mean you need to have a team of 40, many companies do it with a team of one."
The fact that a company could only need one person dedicated to this task shows that social media presence does not need to be a privilege of large corporations.
Lessors could also find cost-effective ways to use social media, as there are free tools that they can use. Reid suggests google alerts, a free tool, where a company can insert keywords into it and pull back results around topics discussed. In addition, companies can find Twitter dialogues that interest them by searching certain keywords.
"If you listen carefully to what people say and the way they say it, entering a conversation you would be surprised how well the dialogue can go and the momentum you have cut through with your audience," says Reid.
However, for companies with a budget allocated to social media there are some paid tools that can be used to increase their channels’ effectiveness in business generation.
LinkedIn has a number of tools that companies pay to use which could help in driving business, an example is ‘sales navigator’ that provides lead recommendations. LinkedIn’s description of this tool is: "Easily save leads and follow updates of your prospects to turn cold calling into warm conversations."
GE Capital’s Miranda describes how his company uses LinkedIn tools: "We think that leveraging LinkedIn is a tremendous way to get closer to a company and its employees and connect with them. We use tools from LinkedIn like Lead Accelerator and LinkedIn Sales Navigator to find the customers that we need to connect with and determine ways that we can provide them value and build relationships from a social perspective. It is a phenomenal way for us to look for new customers. These tools have without question led to business deals for us."
GE Capital has trained over 1500 sales representatives over the last two years on how to properly use LinkedIn to engage its customers and potential prospects. Sales representatives reach out to companies through InMails aiming to build a relationship that eventually leads to a deal.
Another part of lessors’ social media strategy is advertising. Companies have been using paid media like sponsored updates on LinkedIn and promoted Tweets, in order to reach their target audience.
Another paid advertising instrument for companies is LinkedIn InMail marketing campaigns, which Miranda says that they have proven to be effective.
Miranda says: "We have done paid InMail campaigns on LinkedIn, which have proven to be extremely successful. For these campaigns we determine a specific customer segment, for example customers in the food and beverage industry, and we send an InMail to their CFO or CEO. The InMail may come from a sales representative or sales manager and our goal is to introduce ourselves and show the value that we can provide them with. Without question we leverage paid media to help boost our overall program."
Although BFS uses Twitter ads, Reid says that advertising on social media does not drive high amount of business.
"The market forces are such that it is quite difficult to get a direct response. You can spend a thousand pounds on an advert and get ten enquiries out of it. There are some circumstances you can do that but generally it is cost-prohibitive. It can be effective to have some advertising but you can do some clever things around remarketing. For example we only tend to use advertising on social networks when somebody already had an engagement or interaction with us before," says Reid.
A cost-effective way for content to be promoted is through sharing by social media users. Lessors, like CIT, have been advising their employees to share the company’s social media content in order to capitalise on their network and increase the reach of their posts.
CIT in order to encourage its employees to share the content has launched a monthly contest. Menz explains: "Every day we are posting new content to the different social media sites. For LinkedIn specifically we are encouraging employees to like the content and share it on their own. Every time they like or share the company’s content, they are entered into a drawing and we give out a monthly prize."
It is clear that a successful social media strategy requires good planning and monitoring. Having a budget allocated for certain functions seems to be beneficial, but not essential, making such a strategy applicable to lessors of all sizes. A social media strategy could become part of every lessor’s marketing strategy and an avenue to attract new business.
