While financial services companies are generally keen to jump on the social media bandwagon, few have made concrete steps to budget for a marketing program or measure its results, according to a report by Ron Shevlin, senior analyst at Aite Group in Boston.

A survey or 166 companies, 85% of them banks, found that 60% of financial institutions still consider themselves novices at marketing themselves through social media. And while 90% of financial services companies expect to have a budget dedicated to social media by 2012, 30% of companies don’t have any budget allocated at all now. The harsh realities of actually running a successful social-media don’t end there. “We asked where the money is going, how they’re organizing their social media efforts and how they’re measuring the results and they’re not measuring anything,” Shevlin said. “The bottom line is that while financial services firms see a lot of metrics as being important, most firms don’t think they’re doing particularly well.”

The money these firms are thinking about allocating to social media is significant, despite a key advantage of social media being that it’s usually free to use. By 2012, 40% of financial services companies plan to allocate anywhere between 2% and 10% of their total marketing budgets to social media. “Some even said 20% to 50%,” Shevlin said. “I find that hard to believe. The reality is that most larger firms are spending seven to nine figures on marketing, and 2% to 10% is a lot of money. If this is a truly effective marketing strategy, it should be an opportunity to cut the marketing budget because this is such a cheap marketing method.”

The reality of social media marketing is that while the financial services industry has high hopes for what just about everybody is hailing as a paradigm shift in corporate outreach, nobody has any real evidence that it’s going to work. “The hype is getting to be deafening,” Shevlin said. “Social media is probably not going to transform your marketing.”