DES MOINES, Iowa-If it seems like credit unions are struggling to effectively leverage social media, at least they're in good company, according to one observer, who notes there are plenty of other industries still searching for ways to build their own social media business case.

"The struggle financial institutions and credit unions have is that financial services are not the most sexy products and services that people interact with," said Brian Day, Dwolla product leader at The Members Group. "The consumer and demographic utilizing social media most frequently may not be attracted to financial services as they would be to a new restaurant, new music or a new line of clothing That's something FIs do struggle with and that's a challenge they do have to overcome."

Rather than continuing to search for a way to use social media to boost the bottom line, Day suggested that credit unions focus on using tools such as Facebook and Twitter to tell the credit union story, with a focus on activism, community involvement and ways the CU helps others. Moreover, instead of constantly using social networking sites to push the institution's products and services, he suggested focusing on how members are helped by those offerings. Don't just promote the 1.99% promotional auto rate, he said, but tell the story of the struggling family that refinanced their car loan with the credit union and saved money as a result.

"Something like that where it's beneficial is better than just blasting out the car loan special," he said.

One of the biggest mistakes that credit unions make with social media, he said, is joining Facebook and Twitter with no strategic objective-they're merely there because they think they're supposed to be there. "CUs have to take a step back and figure out what the problem they're trying to solve is first, and understand that social media has a place in that," he said.

The good news is that the big banks are experiencing the same trial-and-error process that CUs are-at least when it comes to social media, said Day.

Day manages The Members Group's work with mobile payments provider Dwolla, and he predicted that it will be another three to five years before the mobile payments landscape settles, pointing out that the mobile payments sphere is going through a similar trial-and-error process as social media. Dwolla lets users make P2P transfers using their Facebook contacts as an address book, even if the person on the other end of the transaction doesn't have a Dwolla account.

Despite that, Day said that the jury is still out on how social media will fit in with mobile payments at the point of sale. "I don't think that's quite as evolved as the P2P side of things," he said.





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