The study, titled "The Credit Union Brand: What Is It Good For" and authored by Larry Compeau of Clarkson University, Potsdam, N.Y., focuses on the public impact of both national and single CU branding ventures and their influence on future CU growth in light of seismic field of membership changes affecting the industry.
Filene officials said the national versus individual brand debate "deserves analysis" now considering the erosion of single sponsors, emergence of larger membership groups based on multiple-employer units, metro-area changes, countrywide professional associations and new online loyalties.
Among key conclusions, the Filene study found no "strong brand image for credit unions" nationally and any significant brand identity exists mainly "at the local individual credit union," though a national brand remains a noble goal.
Nonetheless, members find their CUs "a little more personal" but still "not as sophisticated" as banks, the study said.
"This research failed to find any strong global sense of 'credit union' as a brand," wrote Compeau. "About the only sense we could identify of any overarching brand" was when asked how a credit unions differ from banks, respondents " eventually mentioned that credit unions are 'more personal.'"
"Most everyone knows that Heinz is the slowest ketchup and 7-Up is the 'un-cola,' but do consumers really know that credit unions are the 'un-banks'?" asked Compeau, whose study encompassed 29 interviews of CEOs, managers and members at six CUs, of which only one was identified, Interra CU of Goshen, Ind.
Data was drawn from two other CUs, also not identified.
Officials of Interra were not immediately available for comment on their citation in the study.
The branding study includes an executive summary by George Hofheimer, Filene's chief research officer, who maintains that the findings show that members "hold a strong brand identity of their individual credit union" describing each as "reliable, friendly, helpful, and informative."
However, employee perceptions of a CU brand identity "are weaker than member perceptions," and, except for long-tenured members, most "tend not to differentiate credit unions from banks."
Regarding the national brand, Compeau wrote that "from our research, we take the position that a national credit union brand might be beneficial, but only in an indirect manner."
On that point, Hofheimer wrote that is "not necessarily a ringing endorsement for what many think is a panacea for U.S. credit unions. So rather than going to the same old well of a national branding campaign, consider saving those nickels and focus on your individual credit union's identity."
In his findings on what CUs should do in building an individual brand, Compeau suggested the focus be on "emotional rather than functional qualities."
The financial services marketplace is rife with brands positioned around service, quality, convenience and price, said Compeau, but the compelling brands tackle the less obvious emotional qualities that are more difficult to compete with, like localness or associations with a certain lifestyle such as environmentalism or religious beliefs.
Using the Compeau data, Hofheimer urged CUs make "simple connections" for members and nonmembers about what a brand means, suggesting also that a "local credit union brand community" be developed.
"If you've ever talked to an Apple user, you'll understand what a brand community is," wrote Hofheimer.
Initial reaction to the Filene report was overall positive though there were some questions about the small sampling.
"Why do we keep asking if credit unions need a national branding campaign?" questioned Jeff Pilcher, an Elko, Nev., branding strategist. "The industry has done study after study proving people see no difference between banks and credit unions. The Filene report is just one more reminder, confirming-yet again-that the industry needs an image, awareness or branding campaign."
And Teresa Freeborn, president/CEO of Xceed Financial CU in El Segundo, Calif. and a member of Filene's Research Council, said "I remain an undying advocate for a national branding campaign and yes, some of us as individual credit unions will continue to do a good job of building our own credit union brands, but as the publication points out, our best bet for future success will come from building a credit union brand community."
And Washington marketing consultant Paul Lucas called the publication very timely coming during a critical period when CUs need to devote more of their budgets to developing individual brands.
"You want your credit union to be ready with a solid brand when things open up, say, in the third quarter of 2010," concluded Lucas.