Consultants Say CUs Should Be More Aggressive in Loyalty, Expansion Strategies
SEATTLE -- A 55-year-old veteran of the credit union industry and a 25-year-old marketing consultant see the world quite differently. Both, however, agree that credit unions need to be more aggressive in expanding their memberships.
Former NCUA Chairman Dennis Dollar and marketing consultant-publisher Bryan Sims shared their thoughts in subsequent talks on the first day of NASCUS' three-day meeting here.
Dollar said credit unions need to do a better job of cementing member loyalty and being more aggressive in getting new members. He noted that membership growth has been stagnant--last year it was 1%--and that's not a recipe for long-term success. He also noted that credit unions have only 6.7% of all federally insured deposits.
"You have to turn mere members into sincere members. And don't assume that just because they like you, they'll stay loyal. And don't build a business plan based largely on member loyalty," he said. Dollar is also a former credit union CEO.
Dollar consults with his clients on plans to increase the number of checking accounts, which he said is one area where credit unions should dominate.
The graying of credit union members and executives provides valuable opportunity to try new things, Sims advised.
"The emerging technologies will make it easier for young people to start companies, and they will need financial services," said Sims.
He has first-hand experience in this area. Sims started his Oregon-based consulting and media company while still a teenager. He said financial institutions and prospective investors were initially quite skeptical of a college dropout who started his own business because he needed to help support his family. Now, brass/Media, which he started in his bedroom, has 36 employees and clients all over the country, including several credit unions.
Sims said credit unions can appeal to Generation Y customers by marketing bilingually in certain areas where there are heavy concentrations of immigrants because many of those young people have not been targeted by other financial institutions. He also said credit unions could attract more young people to their staffs by encouraging volunteerism, which is a high priority among younger workers.
He also said while young people love the convenience of online banking, that doesn't mean they don't care about the personal touch as well.