<p>"It's not what you don't know that hurts you. It's what you know that ain't so."-Will Rogers, Jr. Just as the typical credit union a decade ago is vastly different than it is today, so, too has changed what had been the realities of credit union marketing. Where a typical credit union's marketing may have consisted of occasional statement stuffers and flyers posted in the service center lobby, today they are evaluating MCIFs (marketing customer information files) and CRMs (customer relationship management systems). Old marketing "truths" no longer valid Today's credit union, whether small or giant, restricted FOM or community charter, faces a new set of marketing truths in capturing the hearts and souls of its members. Just as the core truths of the credit union scope have changed, so too have the realities of marketing in the digital, competitive and sophisticated financial services world. The science of marketing (yes, it is a science, with statistical behavioral research at its core) has determined new "proofs" which belie what was taught on campuses and in professional seminars just a decade ago. 1. "If your members know you and believe you, the battle's won." Wrong. Top-of-mind awareness and credibility, the dual penultimate goals of yesterday's marketing programs are woefully inadequate. Unfortunately, many marketers still believe that top-of-mind awareness is the goal. It's a "if they just know our name, they'll join." It's the easiest marketing objective to accomplish, it only requires spending advertising and PR dollars. But it's erroneous. One major credit union recently engaged a blind survey of its members, asking about the "first financial institution that comes to mind." Not surprisingly, two-thirds mentioned the local bank. Think how vulnerable those members would be to an engaging marketing effort from that bank. Take it a huge step further, they "believe" your message and have positive feelings about the institution. The battle is won, right? Wrong. You know the names KIA, Hyundai, Porsche and Mercedes. You believe that KIA and Hyundai provide low cost and value, while Porsche and Mercedes are finely engineered, high quality vehicles. Have you bought one? Customers utilize your services because of what they know about you, what they feel about your institution and its offerings, and the motivation behind their needs. Motivation happens when energy is put behind satisfying a need. Motivation requires that a need be recognized by members. Often it needs to be pointed-out by the institution ("your child's college education may cost over $250,000″). It also requires reasons why the need can and should be satisfied by you ("the credit union has a specialist available to help tailor a college savings plan specifically for your child"). These two components will help energize members. 2. "Member loyalty is the goal." Wrong. Member satisfaction is the goal. Most credit unions gauge "loyalty" by member longevity or by a static assessment of product penetration. Neither metric gauges member satisfaction, the only determinant for long-term success. Members develop a "script" of what they think an interaction with a financial institution should look like. This script becomes their set of expectations. If these expectations are not met, there is clearly dissatisfaction. The member may or may not change institutions when dissatisfaction results (hence, don't gauge satisfaction by longevity). It's an "all banks and credit unions are alike: long lines, hassles, problems" belief that keeps them there. All it takes is a competitor to convince them that they are different. Because a member doesn't change financial institutions, or even purchases more services, doesn't mean they are satisfied. A behavior change – moving their accounts – is dependent on many things, including frequency of dissatisfaction, severity of the episode(s), costs associated with changing (both monetary and effort), and relationships with employees of the institution. There is not only danger in losing a member, but the dissatisfied member often becomes a negative "word of mouth" advertiser for your credit union. If a member's expectations are met by their experiences in the credit union, they are technically satisfied. This lack of deviation from member expectations is the benchmark. In this era of increasing awareness of the economic value of lifetime relationships with customers, many financial institutions are raising the bar in providing service. When a member's expectations are exceeded, a state of "delightment" has been achieved. How many members have been delighted by your credit union this week? Those who have not are vulnerable to efforts by competitors who offer lower service charges, higher interest rates, and free services. 3. "The member is always right." The member is not always right. Southwest Airlines was one of the first major companies that risked saying this. Their reasoning was that employees must also be considered when a service company is dealing with customers (members). If employees are unhappy, members will never be delighted by the credit union. There are two "customer" groups the company must satisfy: internal and external. A credit union cannot ask its employees to deal with difficult members at the expense of their own feelings and sense of worth. Therefore, training in service companies has turned to helping employees deal with difficult customers and translate what they are saying to passive marketing research. Employees must be trusted and empowered to judge whether a member relationship should be salvaged, provide the tokens necessary to do so, and glean the information from the encounter needed to improve the service operations of the institution. Employees can no longer be expected to "grin and bear" the sometimes challenging behavior of customers. They should be trained to turn tense situations into "bounce backs." 4. "Location, location, location." Forget it. One of America's most successful banks, USAA Federal Savings Bank, has a worldwide customer base and a single office. With the digital age, the emphasis must be on "anytime, anywhere and anyhow." The majority of your members are better served with 24-hour member service call centers, online banking, cooperative and comprehensive ATMs, rather than costly bricks-and-mortar branches. This is not to say, "don't branch." The winning strategy is "clicks-and-mortar" – branch where the personal service is needed, but be sure that you are "anytime, anywhere and anyhow." That requires a comprehensive electronic delivery strategy. 5. "Location, location, location." Remember it. The location you want is a prominent and engaging position in your members' thinking, in their minds. You want your credit union brand, your essence, to engage them. You want them to be involved. You want to be their primary financial institution and the place in which they take pride in ownership. Instead of thinking "running by the bank," you want them to think "going by the credit union." When they think "good deeds," they think their credit union. When they think "financial solutions," they think "credit union." When they think of a partner in their future, they think "credit union." This is brand management. This is the location where you want to be. While the realities of today's credit unions have changed, so to have marketing "truths." For credit unions to succeed, they must first realize the new competitive environment in which they operate and, second, embrace the new, member-centric, science of marketing.</p>