MySpace Probably Won't Attract New Members, But Other Opportunities Await
DECATUR, Ill. -- Of the 20 or so credit unions who have profiles on Myspace, Land of Lincoln Credit Union maintains the most active account, logging on to check messages every day and publishing a blog entry a few times a week.
Member Service Representative Jessica Gorris, a 28-year-old who works in the credit union's Mattoon branch, created the site last fall and spends approximately 30 minutes a day maintaining it.
Initially, Gorris thought the free online networking service would help her two-year-old branch attract neighboring college students. Results have been disappointing: the site has resulted in few, if any, new credit union members.
But the site hasn't exactly gone unnoticed, either. MySpace tracks the number of visitors to the profile, as well as the number of blog readers, and LLCU's site is averaging approximately 300 visitors and 300 blog readers each month.
Gorris has since shifted her emphasis to financial education, writing blog entries about topics of interest to 20-somethings, like how to discuss finances with a new spouse or how to challenge an incorrect credit report listing.
"I don't know how much effective direct marketing you can do on MySpace, because it's not local. Our credit union Web site is more geared to our local members, and is a better place for marketing.
"But, I think it can benefit the credit union because MySpace is all about building relationships, and financial education is one way to do that. Young people aren't going to listen to their parents when they lecture them about money, it will go in one ear and out the other. But there is definitely an opportunity to earn a person's respect by teaching them the kinds of things they need to know, and even want to know, but don't want to hear from their parents," Gorris said.
For those living under a rock, MySpace is a free social networking Web site that was founded in 2003. It is owned by Fox Interactive Media.
A free and easy way to publish a personal Web site, MySpace has a reputation for being popular with teenagers and 20-somethings, although the site claims as many as half of all users are over the age of 35. Demographic statistics gathered from user registration are unreliable, because many users lie about their age.
MySpace members request permission to be linked to other users as "friends". Friends are granted access to view private profiles, which are popular among minors. Friends may also leave comments on each other's pages, or send private messages to each other, similar to email. Users publish bulletin messages that can only be read by friends, and may choose to make blog entries only viewable by friends.
According to Web information company Alexa, MySpace is the Internet's fifth most popular Web site, and the third most popular Web site among Internet users in the United States. Nearly 4.5% of all Internet users visit the site every day, to the tune of 90 million visitors per month.
Many credit union managers believe MySpace is not an effective marketing tool, and is not an appropriate place to promote credit unions. Still, as the average age of credit union members continues to increase, some credit unions are willing to give it a try.
That's why LLCU President/CEO Mac Dunaway decided to give MySpace a trial run, after a long deliberation with his management team.
Dunaway, who has three daughters who range in age from 26 to 32, was already familiar with MySpace and competing social networking site Facebook. The CEO was leery of establishing a profile for his credit union because of the MySpace's reputation for unmonitored content.
"It was controversial among our team and still is to some degree, but where else are you going to make a connection with young people? Some of them spend hours a day at their computers. At least it's an avenue where we can reach them," he said.
Not All Sold On MySpace Impact For CUs
Twenty-three year old Bryan Sims is arguably one of the best people to ask about credit unions and MySpace. The Brass Media CEO is an expert in financial education and marketing to young adults.
Sims isn't a big supporter of credit unions using MySpace for marketing purposes, mostly because the cooperatives aren't using it correctly.
"I think people are saying 'MySpace is the cool new thing, so let's create a profile.' Then, it just sits there forgotten, or they add a bunch of credit unions as friends, and it becomes a credit union networking thing, not a member networking thing," Sims said.
The Gen Y executive said if he were trying to promote a credit union through MySpace, he'd align it with local groups that have already mastered the art of MySpace marketing--musical performers.
"Find a group of local bands, and support a concert that features them. Then, you can get your name out using the band's existing distribution channel, which their friends already trust," he said.
Sims cautioned credit unions about advertising rates or accounts through MySpace profiles, because interestingly, users think of the public site as private territory. Advertisements on MySpace seem as intrusive to Generation Y as a telemarketer calling a baby boomer during dinner, he said.
That being said, Sims pointed out that Chase Bank has successfully marketed a credit card through rival Web site Facebook. Ownership of the card corresponds with membership in a Facebook group, which has so far attracted 36,000 members. Card owners can redeem points in the site's store, or may share them with friends or donate them to charity.
Of course, Chase had to probably pay quite a bit for that, but the point is, people are using social media to integrate financial services products and having results. The thing to remember, though, is that spending an hour creating a MySpace profile won't produce the same results. I'm sure Chase spent a lot of time researching it and putting it up. It's like anything else, if you don't have the resources to do it right, you're better off not doing it at all," he said.
Opensourcecu.com blogger Trey Reeme doesn't recommend credit unions attempt MySpace sites either, because users are becoming increasingly anti-corporate as advertisements clutter the site. MySpace was meant to connect friends, not companies with customers, he said.
I seriously doubt a sixteen-year-old will come home from school thinking, 'I want to go to my credit union's MySpace page. I don't know enough about revolving debt, so now's a good time to start learning and what better place than MySpace,'" Reeme said.
However, the executive vice president of blog host Trabian, an Indianapolis-based Web design firm, said social media holds significant potential for credit unions, because they are inherently social networks.
Trabian recently built an online community prototype for Filene Research Institute, in support of its My Community Connection project. My Community Connection harnesses the power of online communities to match credit union members' interests with volunteer opportunities, interest groups and events in their local communities.
Successful social media campaigns are built around adding value, not around going viral. Moreover, it's not about "selling" at all. It's about having and facilitating conversations," Reeme said.
If credit unions want to enter social media and reach young members, they should focus on their message first, and the distribution channel second, Sims said.
"Where the media world is going right now, with social networking, now more than ever it's important to tell an authentic story, and have the product be better than any marketing or advertising message. The problem isn't MySpace, it's that credit unions have this great thing, but they haven't figured out how to bottle it and share it with everybody," Sims said.