Technology is an Art, Not a Science, Internet Expert Says
MONTEREY, Calif. - Credit union executives need to start thinking of technology as an art rather than a science, said Internet entrepreneur Scott Klososky. Klososky shared his views on technology trends and how credit unions can use them to increase youth market share during the general session of the California...
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MONTEREY, Calif. – Credit union executives need to start thinking of technology as an art rather than a science, said Internet entrepreneur Scott Klososky. Klososky shared his views on technology trends and how credit unions can use them to increase youth market share during the general session of the California Credit Union League’s Big Valley Conference this morning. “Technology is merely a tool you can use to create magic,” Klososky said, “and the great thing is that you don’t have to spend as much as you think to get that magic if you know what you’re doing.” In order to capture that magic, credit union executives must put more effort into understanding technology and IT employees, he said. “You need to understand that programmers are like artists – I know I treat them that way in respect to the hours they keep and how they dress. If you treat them like factory workers, you won’t be pleased with the results,” he said. The Internet pro presented sobering statistics to support his theory that credit unions are missing the mark when it comes to technology, including a decrease in credit union membership penetration rates in the 18-24 age group from 10% in 2002 to 5% in 2004. “Looking at these statistics, my fear is that you don’t understand how to market to this age group,” Klososky said. E-communities, like the popular MySpace service, are changing the way companies market to young consumers. Rather than pay attention to advertising, Klososky said, young people listen to advice from their peers about products and services, often through exchanges in e-communities. Savvy organizations are tapping into the e-community trend and finding ways to promote themselves through affinity marketing. Credit unions must be willing to take risks and find innovative ways to use technology to reach members, Klososky said. Because credit unions are smaller than banks and have less bureaucracy, they can more quickly adopt new technologies, and compete effectively against large banks. “Credit unions have all the parts in place to be successful at innovation. You just have to make it a part of your culture,” he said. Additionally, credit unions must do a better job of mining information from their members so they have more opportunities to tighten their relationship using technology, Klososky said. “It’s already assumed a credit union is a family culture, so it’s OK to ask members personal things,” Klososky said. Specific technological trends credit unions can leverage include the emergence of industry utilities, advances in handheld device applications, storing data and software online instead of on computer hard drives, online security advances, and plug-ins to existing frameworks. Klososky stirred the creative juices of the audience when he described new trends in games designed for handheld devices. One hot new game requires players to visit retailers with wi-fi access, specifically Starbucks, to gain virtual energy the player can use to perform better in the game. Going to Starbucks to energize a game character is a take off on the energy humans gain when consuming caffeine, he pointed out. “You’re in the currency business – wouldn’t it be neat if the players had to go to a credit union to get virtual currency for the game?” Klososky asked. He also described a new company called Innovalarm, which provides a free application that uses a computer microphone to detect if an alarm has sounded in a home, and then instructs the computer to call 911. Klososky suggested credit unions should provide the free application to members upon closing a mortgage loan or upon the arrival of a new baby. The trend expert also discussed outsourced parenting, using the example of Chuck E. Cheese as an outsourcing service for children’s birthday parties. “Why not outsource financial education? Credit unions can provide Web-based tools to teach kids about bill pay and loans, for example,” he said. E-vaulting is another service credit unions can provide. Credit unions should think of e-vaulting, in which consumers save electronic valuables like photo and music files online, as an extension of safe deposit boxes, Klososky said. -
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