TikTok has become the go-to platform for Gen Z to learn about personal finance. According to a Forbes Advisor-commissioned survey by Prolific, 79% of millennials and Gen Z have received financial advice from social media. This trend is having a significant impact on the banking industry, as banks are forced to adapt their marketing and engagement strategies to reach this new generation of customers.
The Rise of Finfluencers
One of the main reasons why TikTok is so popular for financial advice is the rise of Finfluencers. Finfluencers are social media creators who share financial tips and advice with their followers. Many Finfluencers are young and charismatic, and they can connect with their audiences on a personal level.
However, there are some concerns about the reliability of financial advice on TikTok. Some Finfluencers need to be qualified to give financial advice, and they may promote products and services that are not in their followers' best interests. Additionally, TikTok's algorithm can amplify misleading or inaccurate information.
How Banks are Responding
Banks are responding to the rise of TikTok in several ways. Some banks are creating their own TikTok accounts and creating content relevant to their target audience. Other banks are partnering with Finfluencers to promote their products and services.
Banks are also investing in financial education and literacy initiatives. These initiatives are designed to help consumers make informed financial decisions, regardless of where they get their financial advice.
Challenges and Opportunities
The rise of TikTok as a search engine presents several challenges and opportunities for the banking industry.
On the one hand, banks must find ways to reach and engage with Gen Z customers on the platform. This means creating content that is relevant and engaging and partnering with Finfluencers who their followers trust. On the other hand, banks must know the potential dangers of getting financial advice from social media. Banks should educate their customers about the importance of verifying the credentials of Finfluencers and doing their research before making any financial decisions.
Overall, the rise of TikTok as a search engine is a significant trend for the banking industry. Banks that can adapt their marketing and engagement strategies to reach Gen Z customers on the platform will be well-positioned to succeed in the future.
Here are some specific tips for banks on how to use TikTok effectively:
Create content that is relevant and engaging to your target audience. TikTok users are looking for short, informative, and entertaining videos.
Partner with Finfluencers whom their followers trust. Finfluencers can help you reach a wider audience and promote your products and services more authentically.
Use TikTok's advertising platform to target your ideal customers. TikTok offers various targeting options, including demographics, interests, and behaviors.
Be transparent and honest in your communication. TikTok users can be wary of brands trying to sell them something. Be upfront about your products and services, and focus on providing value to your audience.
A New Partnership for the Future
TikTok is a powerful platform that can help banks to reach and engage with Gen Z customers. However, banks need to be aware of the potential dangers of getting financial advice from social media. By following the tips above, banks can use TikTok effectively to promote their products and services and educate customers about financial literacy.