Getting credit and borrowing have become a difficult task for many Americans to achieve these days. Bad credit reports, poor credit scores and loss jobs have made it hard to get loans. Facebook, Twitter and MySpace have become the latest and greatest tools in keeping in touch, sharing personal moments, and communicating in general amongst friends, families, coworkers, and anyone else who cares to listen. Now social networks may be targets for advertisers and source for credit seekers.
Indeed, 67% of the world is online and sharing their lives using some form of social media network. Accordingly, advertisers and marketers have taken notice. Among the latest trends in the marketing world is credit.
Targeted marketing to people who use social media networks has become a lucrative and successful business. Companies who specialize in recognizing trends, habits, likes and dislikes etc. of social media users are able to sell this information to advertisers as well as creditors.
For creditors, simple online conversations about money can mean the difference of who gets account protection and who doesn’t. They base this decision on marketing that extends beyond the usual targeted demographic method. With the dawn of the online social network, analysts find out who you are by the idea that “like follows like”. When a friend likes something, the idea goes, you may too.
The recession has made creditors and banks reticent to extend their valuable dollars to risky customers. The threat of default or bankruptcy is too great, and they don’t want to face another financial collapse. Now, in order to assess whether you have good credit or not, they will look at one's online social network. If friends have good credit, then you (they assume) probably will too.
This works well for those who need a credit extension, but find that the bank is hesitant in doing so. The bank or credit card company can simply log on and find out a little more about you and what kind of risk you bring to the table.
To be sure, the idea is not to be nosy and to look up consumer's credit scores and reports as well as of each and everyone on your friends'. Rather, by studying social graphs, companies can tailor their products to the consumer based on his or her Facebook, MySpace and etc. It supports the idea that like follows the like.
However, not everyone is convinced that social graphs are accurate. Judging people based on their friends or acquaintances is not always accurate especially if you use it as a gauge on credit. After all, the tried and true credit report tends to be more reliable than what a person’s favorite movie or food is.
There is also the question of privacy. If companies use people’s personal lives to monetize or make decisions on finance or credit, is it really a fair and accurate assessment? Should companies even have the right to use this information? The potential downsides are numerous. Witness those who have been caught doing things they shouldn’t have on Facebook and then getting fired over it.
Finding credit or receiving credit counseling online is a wonderful thing. However, privacy issues become target of top consideration when sharing financial information online. There is a fine line between what is public and private in the online world. On one hand, online social networks let you keep in touch and find new friends. On the other hand, one can lose his or her job. In order to maximize privacy one needs to change settings to private or classified.
Written by Lani Shadduck
HULIQ.COM
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