At first glance, ISSUU seems to be filling a significant gap in the range of social media: providing a way for banks and other businesses to engage with the public through print publications in the same way that YouTube provides a vital outlet for corporate video content. The site passes the first test, of providing a lot of attractive content. If you want a beauty parade for publishers and graphic designers, ISSUU is a good place to go. However, the site has yet to be included among the fairly select group of Internet presences that have become meeting places on a mass scale. To achieve that status, ISSUU needs to recognize that readers (and that’s who most site visitors will be) are more concerned with finding individual articles of interest than admiring a magazine cover to cover. They need more help from the site, probably in the form of (blog-style) tags for articles. The finance industry has to accept that their material will be jostling for readers’ attention alongside competitor offerings. If ISSUU insists on always preserving the integrity of individual publications in presenting content, it won’t become the channel of choice for finance industry players to grow their readership.

ISSUU

The big Facebook IPO is history. Some people think it has been a disaster. Personally, I believe that it has been a big success for Facebook. May be the stock is overvalued. But the company has now lots of firepower to gear up its marketing engines, try out new business models and generally become a huge factor in online marketing.This means that banks should think long and hard about the role of Facebook (and other social media) in their marketing strategy. It will be an indispensable building block for every marketing and sales strategy of every bank worldwide targeting private cutomers.

Here is a snippet from our latest report on Social Media in Banking 2012:

“Our analysis gave lots of reasons to think that almost universally banks have neither a comprehensive social media strategy nor a dedicated team to serve all media in an integrated manner. Little better than having no social media presence at all, is sending conflicting messages across various channels or showing no activity for weeks. These mistakes can easily be avoided by establishing a dedicated social media team that ensures the message the company wants to send is communicated in an appropriate way across all channels.”

You can get the whole report here. Over the next weeks we will give some more peek previews of our analysis with regard to Social media.

Google+ was launched 7 months ago in June 2011. On January 19 it was reported that G+ has surpassed a user base of 90 million and may reach 400 million by the end of 2012. However, these are not necessarily active users (as the 900 million reported users of FB). MPB analysts are working right now on a new analysis of social media & banking (to be published end of March 2012). The preliminary results on Google+ show that most banks have a presence there - but usually without any or with very little content. It can be described as “wait-and-see-strategy” or simply to put a placeholder on the network.

Over the last 2 months G+ has gained a lot of traction and there seems also some clear support from Google’s search services for the network. I guess that G+ as a networking platform is still technically a bit confusing (may be a consequence of the different terminology like “circles”, “hangout” etc.) but is essentially offering a similar platform as Facebook. Some innovations like “hangouts” and the search function seem even better than on FB. Yet - despite some heated discussion among tech geeks - this is not really important. What seems crucial is the point that Google potentially has the market power and leverage to push G+ to become a FB rival. The key here is the search services of Google and some existing services which - in combination with a new viable network platform - can potentially become very successful. Yes, Google Buzz was a disappointment - but probably a necessary stepping stone to the technically much more mature G+.

What does this mean for banks and other financial service providers? They should probably have a presence on G+ and also spend some resources on filling this presence with content & life. Not necessarily too much yet - as it remains to be seen what will happen to G+ over the next 12 months but don’t underestimate the marketing power of a 800 pound gorilla. If G+ can keep its speed one will have to take it seriously very soon. It will be fascinating to watch how and where G+ and FB will try to get a competitive advantage and how the will try to differentiate themselves from each other. Make sure to follow our research when our new report will come out in March with more analysis about Google+, other social media trends and how banks can profit.

Deutsche Bank set another prime example on how to push dubious investment products in their client portfolios without taking on any risk, but charging absurd commissions.  In 2006 Deutsche Bank promoted a fund in Ferris Wheels called Global View. However, so far not ferris wheel has been built, but nevertheless the fund spend up €208 million for property purchases, banking fees and dubious project development costs. So it looks like the average  investors will incur huge losses, but how about the sponsor and sales arm of the fund Deutsche Bank ?

“For Deutsche Bank, though, the Ferris wheel project turned out to be very good business. The Frankfurt-based bank earned €19.2 million through Global View thanks to its client advisors, who drew in €160 million from the bank’s customers within the space of 10 weeks, primarily from German small investors like Schmidt. The bank itself, however, never invested in the fund. Global View used the bank Delbrück Bethmann Maffei (DBM) instead. Deutsche Bank preferred not to invest its own money in the project, for example through loans. Even when that money was badly needed, the bank declined on the basis of a “market risk” that couldn’t “be assessed and covered by the bank. [...]

The letters and e-mails raise suspicions that Deutsche Bank not only insisted on unusually high commission rates that were meant to be concealed from investors, but even doubted the project’s chance of success. From the beginning, the bank calculated using an “equity commission of 12 percent. The sales brochure was only supposed to show 10 percent, which called for a creative solution. One Deutsche Bank employee suggested in writing that the excess commission simply “no longer be shown in the brochure”.

To me that looks less like a creative but more like a criminal solution !

Last week we published a report about the privacy risks of Private Banking and Wealth Management websites. The bottom line was that almost two thirds of websites offering online communication through contact forms or email did not care to take even the most basic precautions in order to protect user privacy.

In the light of the recent data thefts affecting mostly European Wealth Managers we find this reckless and negligent. To be fair, there are many cases of banks with role model websites offering all sorts of preacautions and warnings for their users. Yet, it is still deeply unsettling that about 60% of  the analyzed banks across 17 markets have no clue or do not care about privacy. Especially since we are not talking about auto dealerships or mon-and-pap-grocery-stores. We are talking about an industry whose fate rests on a claim of trustworthiness and confidentiality. There is only one thing to do for the affected banks: Realize that you have arrived in the 21st century - a time where online conversations have become as normal as telephone or letter communication and should be protected accordingly.