Thursday, December 20, 2012
Family Pride – Credit Unions should value their last name.
Rob Kimmett, Sr. VP Marketing, New England Credit Union Services, LLC
Every so often we see stories about credit unions that have elected to de-emphasize the “credit union” part of their name. Some have added the word financial to their name in an effort to let the uniformed know that they are in the business of lending money.
This approach is usually explained away with a sort of “if you can’t beat them, join them sort of rationale. The spokespeople explain that “the consumer doesn’t know what a credit union is so we decided to make our brand more easily understood.” The problem is that this argument doesn’t hold up and furthermore this solution will only serve to further muddy the institution’s brand.
There is no question that consumers are often confused about what a credit union is. Credit unions make a small percentage of the financial services industry and over the years our institutions have been far less visible that the competition. In fact it is that lack of visibility that is at the root of this “identity crisis.”
In a nutshell credit union members and other consumers don’t know what a credit union is because most credit unions haven’t told them what they are. Instead we have marketed products and services that they see other institutions offer and as a result they confuse us with those institutions. It’s a very natural and predictable response.
The problem is twofold. First we are not banks and it is important that the consumer and opinion leaders know that we are not so that they don’t treat us like them. Second most people have a tremendously negative view of the banking industry. Our unique and distinct nature is a crucial competitive advantage.
Credit unions that successfully communicate that aspect of their brand have a serious head start on the competition. Credit unions are not-for-profit, democratically controlled, financial cooperatives. Each element of that definition provides real and tangible benefits for the consumer. Once we imprint that message every other marketing pitch we make has a jump start.
The consumer, member and non-member, is not going to develop a deep understanding of the credit union difference overnight. But if we devote a fraction of our marketing dollars to explaining our common last name, over time people will get it and they will look for a credit union instead of a bank rather than seeing which institution is 10 basis points lower on a loan.
Take the time to show a little family pride and explain our common last name. It will pay dividends.