Social media is for staying in touch with your old college roommates and sharing silly cat photos, right? Clearly. But it can also be a smart way to get more out of your credit card.
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More of us are realizing that social media channels such as Twitter, Facebook, Pinterest, Foursquare, Instagram, Google+ and YouTube can help us resolve problems, find out about perks and maximize the benefits we get from our credit cards. All you have to do is look at the growing number of followers and likes for credit card companies on these sites. (See "Credit card issuers' social media links" table below for details on how to connect with your card issuer).
Not every card issuer has figured out how to use social media for something other than advertising. "Some companies do very little when it comes to building a relationship with customers that are their friends or followers," says William McCracken, CEO of Synergistics Research, which analyzes the financial industry. "But there are other providers that do take this relationship-building opportunity through social media very seriously."
To see how your credit card company measures up in social media, do some following and friending, then watch for these 10 ways to engage:
1. Score good deals. In a Synergistics survey of why customers follow credit card companies on social media, McCracken found "people do it because they think it gives them a leg up on specials." Card companies often reward their followers and fans with special discounts. For instance, in 2011 American Express launched the Sync program, allowing customers who registered their Amex cards to access exclusive digital coupons by, say, tweeting a special hashtag or checking in at a merchant with a special Sync offer on Foursquare. "AmEx's card members are heavy tech users, digitally savvy and very engaged in social media," says Bradley R. Minor, the company's vice president of digital communications strategy. Sync is one way of "connecting to Amex's card members where they are engaged and focused."
2. Resolve customer service issues.According to a February 2013 J.D. Power & Associates survey, among customers who had engaged with their credit card company on social media, 71 percent had done so for service reasons such as resolving a problem or getting an answer to a question. When it comes to customer service, "satisfaction is driven, obviously, by response and resolution times, but the actual social service representative is critically important as well -- the way the representative interacts with the consumer, the kind of verbal rapport they establish, their knowledge and their ability to respond to the customer's issue," says Jacqueline Anderson, director of social media and text analytics at J.D. Power.
In the J.D. Power survey, Chase, Citi, Discover and Wells Fargo came out on top for social media customer service. That service pays dividends for the banks: In April, a customer tweeted a complaint to @Discover about not receiving electronic statements. Shortly thereafter, she wrote, "OK, serious props due to @discover. I tweeted an issue and they not only replied back immediately, they solved it for me all under an hour." Some banks even maintain separate social media accounts just for resolving issues, such as @AskAmex or @BofA_Help.
3. Enter contests. To excite customers about their social media presence, many credit card companies are flinging prizes at their followers. For Capital One's 2013 Rally Cry sweepstakes, Twitter fans who cheered their favorite basketball teams with the hashtag #rallycry entered a drawing to win $100 Visa gift cards, autographed basketballs or courtside seats to the NCAA semifinal and final games in Atlanta. Often, companies combine contests with cause marketing efforts, allowing cardholders to vote for cash to go to a favorite charity. Chase Community Giving's Facebook page, where customers can vote on which do-good projects should get a piece of the pie, has 3.8 million fans.
4. Find out about perks. Credit cards usually come bundled with an array of hidden perks, such as extended warranties or travel insurance. Social media helps get the word out. Citi, for instance, has tweeted about its Price Rewind feature, which refunds customers the difference if a product purchased with the card drops in price. Meanwhile, Capital One used its Facebook wall to alert fans that Visa Signature cardholders are entitled to free upgrades at a network of luxury hotels.
Chuck Christianson, group vice president of Connexions Loyalty, a division of Affinion Group, says that the natural next step is for customers to share the perks they're happy with. "Wherever there's value, customers are going to latch onto it and they're going to proliferate it, especially if they've taken advantage of it."
5. Get in on events. One not-so-well-known perk is a VIP experience program that entitles cardholders to attend special events, or at least get early tickets. Citi dedicates a Twitter account, @CitiPrivatePass, to its Private Pass program, which gives eligible cardholders access to coveted goodies like presale Rolling Stones concert tickets or a VIP experience (box seats, unlimited food and drink) at a New York Mets game. Pink recently tweeted that American Express cardholders could get advance tickets to her concerts in Brooklyn and Los Angeles -- and the news was instantly retweeted by @AmericanExpress.
6. Earn money for referring friends. What credit card issuers hope their social media presence brings them, more than anything, is word-of-mouth advertising. To encourage it, some offer incentives to customers who refer others online. Discover, for instance, has a program called Refer a Friend, which gives cardholders $50 in cash back for every friend referred via email, Facebook, Twitter or LinkedIn who eventually gets a Discover card. According to Discover, its cardholders have earned almost $2 million in cashback bonuses since the program's inception. American Express and Citi have run similar programs in the past.
7. Get smart. Finding the right mix of content -- "some entertainment, but also some meat" -- drives customer satisfaction with social media, according to Anderson. Credit card companies strive for that mix on their YouTube channels, where American Express, Capital One and Citibank post fun commercials alongside informative videos about card features. On Capital One's YouTube channel, for instance, you can see a demo of the card company's Purchase Eraser -- a way to redeem miles for travel you've already purchased. Wells Fargo's YouTube channel videos are crammed with basic info on establishing and protecting credit.
8. Buy things. A ground-breaking new addition to credit card companies' social media outreach: the ability to instantly charge things with social media. As part of American Express's Sync program, registered cardholders can actually make a purchase without leaving Twitter. Just respond to an offer with a special hashtag -- for instance, #buyKindleFireHD -- then confirm your purchase, and boom, it's on its way.
9. Get news. You likely don't care about the ho-hum company press releases that credit card issuers disseminate through social media, but other news flashes hit home. Wells Fargo, for instance, hopped on Facebook to let customers know about a denial-of-service cyberattack that rendered its website inaccessible. "Rest assured that your account and personal information are safe," it added, encouraging frustrated customers to call for service. When Hurricane Sandy hit the East Coast, Citibank tweeted that customers could get in touch for help, and Wells Fargo took to Twitter to remind customers to get cash before Sandy struck.
10. Complain -- and get results. In an epic example of using social media to change credit cards for good, 22-year-old Molly Katchpole went online in 2011 to fight against Bank of America's proposed $5-a-month debit card fee. Her petition at Change.org went viral, sparking a massive consumer backlash. The bank was inundated with complaints on Twitter and Facebook, and ultimately decided to abandon its plans. So did several other card issuers, including Wells Fargo, Citi and JPMorgan Chase, which had been considering similar debit fees. Ah, the power of social media.