It’s Hard: That Is What Makes it Great
Posted by David England, Senior Research Analyst, Cornerstone Credit Union League on 8/14/2017

Have you seen the movie, “A League of Their Own?” At a key moment in the movie, the character played by Tom Hanks makes a terrific point….

“It's supposed to be hard. If it wasn't hard, everyone would do it.

The hard... is what makes it great.”

It is certainly true for credit unions.  I see too many comments in Membership surveys about how banks or Apple/Google/Facebook have better digital products and services than those at their credit union.  At the same time, these Members do not trust these other institutions with their money or their data (e.g., personal/spending data). Pay attention to this collection of findings in the bullets below. Much of the information is from an article I read by Jeffry Pilcher, entitled “5 Major Emerging Trends in Retail Banking.”

  • Over 7 in 10 Americans would exchange their data for personal perks.
  • Over 6 in 10 Americans DO NOT want companies to connect their in-store and online data.
  • Most U.S. adults (81%) say that consumers are more vulnerable to privacy violations today than they were five years ago. More than half are concerned that they will be victims of a data breach in the next 12 months.
  • Consumers are warming to purely automated service and support (“robo-advice”). Which bank account to open (71%) and which insurance coverage to buy (74%) are two examples. This advice is seen as more analytical and impartial (trustworthy!).
  • Approximately two-thirds of consumers want human interaction in financial services, especially to deal with complaints and complex products and services.

Will consumers share more data? Or, are they afraid their data will be abused?  It seems the request is…“Give me a financial institution that I can trust with my money and personal information that will treat me well and offer competitive products and services that make my life easier.”

Credit unions are easy fits into this pocket.  We are trusted, and we certainly can deliver what consumers want: safe and secure data which will be used only in ways of which they will approve. But, they expect us to live up to our end of the bargain and deliver important benefits to them – such as:

  • Priority service.
  • Pricing perks.
  • More personalized products/services.
  • An online digital capability that competes with that of the “tech” giants such as Amazon, Apple, Google, and Facebook.
  • Branches that deliver an advanced digital experience and convenience.  

The movement is already working on this.  But, Members want all of this now. They want it safe.  They want it fast.  And, they want it accurate. Are we effectively addressing this?

Yes, it is really hard.  It is quite the challenge. There is a shift in the paradigm: companies used to control the customer relationship, but not now. Members mostly use us for transactions.  They engage us when they want or need to: by phone, in-person, online, drive-through ATM, et al. Many members use other financial institutions for convenience (better/more locations, the mobile apps they want, it was easier to get the loan at the dealership because the credit union was not open when they were at the dealership) or because of habit/loyalty (and what we offer is not compelling enough to get them to switch). 

The solutions to these issues are out there.  Credit unions are learning how to navigate through these waters.  As you do, keep these points in your mind and in your marketing strategies.

  • Members’ primary concern is to get what they want easily.  Channels are often optional.
  • The trends in high tech are real and important, but even Millennials still want first-class human interaction to solve the intermittent “problem” or complaint, to accept advice on complicated products, or to support decisions (e.g., information that might assist with the sale/closing of a home or the purchase of casualty/life insurance).
  • The demand for branches and ATM locations will not fade away anytime soon.
  • Keep innovating and developing new value propositions because the competition is.  We must stay ahead of – not just keep up with – where Members are headed.
  • Use your internal data and marketing intelligence/research to help with innovation, cross-selling, Members’ “Ease of Use” assessments, Member loyalty/satisfaction, etc.

And remember, the “hard” is what makes it great!

Categories: Research, Sales & Service, Strategic Planning & Consulting
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