Financial Services Industry Investing in Digital, Despite Low Facebook Engagement

When it comes to Facebook engagement, the so-called “sexy” brands from movies to entertainment get all of the likes and clicks, leaving industries like financial services in the dust.

A recent study from AdParlor shows that financial services companies face stark challenges on Facebook, from low engagement and clickthrough rates to astronomical cost-per-click rates.

But overall, banks, insurance agents and credit card companies are committed to digital, as demonstrated by their dedication to multiple online platforms as well as increased interactive marketing budgets.

Low clickthrough rate

Not surprisingly, the flashier industries like movies, electronics and automotive see higher daily clickthrough rates on Facebook, while the merchant/banking services industry is holding on with an average clickthrough rate of .03%.

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Low engagement

Another study takes a look at Facebook engagement rates according to industry. Results show that automobile and airline companies see higher engagement levels (in the form of likes and comments) than the finance industry.

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High cost-per-click

The low engagement numbers translate to high cost per click for the finance industry. The average CPC for merchant and banking services on Facebook is $1.24, versus a mere $0.18 for the CPG industry.

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Standout success

But not all financial services firms are struggling. A study from Compete looked at Facebook traffic of over 40 brands from financial services, automotive, retail, telecom and travel industries using data from February 2011. Financial services firms Statefarm, Capital One and Progressive all ranked among the top ten.

Allstate is also frequently recognized for its social media efforts on a number of platforms and in mobile apps.

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Twitter vs. Facebook

Perhaps the shortage of engagement on Facebook exists because financial services companies have seen greater success on other digital platforms, and prefer to focus their efforts elsewhere.

According to a study from Corporate Insight, Twitter is more popular than Facebook for financial institutions. As of August 2011, 67% of financial services firms had a presence on Twitter, while 59% had a presence on Facebook.

Financial services industry marketing budgets

Despite low engagement rates, financial services companies are not entirely discouraged. An eMarketer study shows that the US financial services industry’s online ad spending will steadily increase over the next four years.

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Do you believe that the financial services industry has a place in social media? What types of Facebook activities do you think are effective for banks, insurance and credit card companies? Share your thoughts with us on Twitter.