Silicon Valley Bank and Social Media


         Silicon Valley Bank recently collapsed after forty years in business after it failed to raise outside capital to recoup its investments. Fascinatingly, this collapse happened in around 48 hours after word about the bank's instability made its way through the tightly knit collection of clientele, and the ease of online banking made it painfully simple for all of those customers to pull hundreds of thousands of dollars out of their accounts. The hysteria that so many bought into in the collapse of SVB would not have been possible without Twitter, Slack, Whatsapp, email, and text messages all connecting these high profile clientele together.

        When we all have such easy and instant access to each other and our money, it becomes incredibly easy to make snap decisions about what to do with it. When you are a business with a lot of money to throw around, this can become a huge issue. Without the government stepping in to ensure that clients got their money back, many small businesses may have had problems making payroll this month for employees that needed it. A few panicked actions by the financial departments of large companies could have caused serious problems for individuals and businesses around the country, and social media made it possible for them to feed their own anxiety until they had no choice but to act.

       As marketers, what we can stand to learn from this situation is to be careful about what we post online, and be careful with our reactions to what we read. Matters of reputation about our own company are one thing which require management by our departments, but if allegations of significant issues with other companies are made, then we need to take those with a grain of salt and wait until actual evidence of wrongdoing or misstep can be found. It also proves that transparency and an efficient response to a crisis is an indispensable part of any marketing plan; perhaps if SVB had been clearer about their issues from the beginning, they could have calmed fears and reassured the public of their competency, thus regaining the funds that they lost. In a world where panic can be spread at the click of a button, marketers have to think on their feet and be the fastest communicators of all.

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