It used to be that credit unions were only trying to compete with traditional banks, which was competition enough. In today’s mobile and digital world, they are now up against nontraditional players such as Amazon and Walmart vying to sell financial services to consumers in a quick and easy format.
While the competition may seem fierce, there can be a David and Goliath outcome through outlets such as the effective use of social media. Responsiveness, trust and creativity are three of the reasons the credit union industry is generally ahead of competitors in the use of social media tools as a key means of connecting with members and prospective members.
Members join credit unions because they trust them; the institution’s reputation is a very important asset. They appreciate that credit union staff and know them by name. They are not viewed as just an account number.
Social media can build and protect that reputation by acting as a customer service channel, creating a forum to more intimately engage one on one with them. Social media can also be a very efficient tool for elevating a credit union’s profile by minimizing the disadvantages associated with generally having fewer locations, ATMs and often more limited hours of operation than competitors.
Credit union members are already having conversations about their finances and their financial institutions in the digital sphere, so shouldn’t credit unions consider being a part of these conversations? Social media makes a credit union more aware and proactive and provides an additional way to strengthen relationships with members, mitigate potential harm and enhance your impact on those you reach. If anything, engage in social media as a defensive measure because your digital-friendly competition is already online and will interact with your members if you do not.
If your credit union is also expecting to expand its charter or service area, so should your digital footprint. Your members are getting more mobile and diverse every day, so credit unions must move with this trend accordingly. Credit unions must be where their members are, and they simply cannot do that exclusively with branches. Brick and mortar is not the way members, live their lives anymore – particularly, younger members.
For credit unions interested in engaging social media for the first time, it is best to start small and work your way up. Begin by finding out if members are avid users of Twitter or other social media sites. Ask for their Twitter handles in the same way you ask for members’ phone numbers. Be sure to promote your own Twitter handle via email and marketing collateral to encourage members to tweet any questions or concerns. Commit to whatever channel or channels, whether it is Twitter, Facebook or Instagram, that lends itself most appropriately to the message you want to convey and the persona you want to present.
For instance, if you are a family-oriented credit union, encourage members to upload pictures of their families outside the credit union branch or show how your credit union supports local charities, schools or other civic organizations. Whatever channel you decide, make a commitment in terms of frequency and make sure it aligns with your primary goals and vision.
While the inherent benefits of social media are apparent, it is important credit unions take a measured approach to using the platform. While it is great to start any one-on-one conversation on social media, it is not good to have the entire conversation on social media when it comes to answering complicated questions that require personal member information. Even when interacting through supposed private messages on Twitter and Facebook, credit unions must understand that it is not a wholly secure channel.
While it is good practice to respond quickly and publicly to even sensitive subject matters via social media, it is best to direct members to follow up in private, especially when you know it will take more than 140 characters to deal with. You have more control over the security of those transactions and messages over the phone or in person at the call center. You can build in the process to move conversations from digital to phone or in-person as soon as it is practical. The emergence of nontraditional players in the financial space certainly adds more competition for credit unions, but it does not have to subtract from their membership or prospects. Credit unions’ competitive advantage has always been delivering quality member service, and by enhancing that level of engagement with members through social media, credit unions can continue to thrive. Consider how your credit union’s social media strategies can evolve with time and experience.
Scott Mills is president of the William Mills Agency.
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