More to Community Charter CUs than `Build it and They Will Come'

SAN DIEGO – For credit unions considering a switch to a community charter, it may not be such a field of dreams or a case of “build it and they will come.” Instead, it’s going to take a major effort on the part of credit unions making the transition to a community charter to attract and keep new members. “You were a closed club . . . Now you’ve opened the door. What makes you so special that people are going to want to join?” asked Doreen Burton, senior marketing consultant with MEMBERS Marketing Source at CUNA Mutual Group. “What makes you so unique?” Burton posed that question – along with dozens of others – during an educational breakout session at CUNA’s Mutual recently held annual Discovery Conference . Her program, “Successful Community Marketing,” attracted a roomful of credit union leaders, nearly all of whom said they had made, or were in the process of making, the switch to a community charter. “What’s your promise? What are you going to deliver? What’s going to make you different?” Burton asked the audience. “It does take a lot of time. It does take a lot of dollars. But the impact is well worth it.” Burton said making the transition to a community charter involved rethinking everything from staff development and training to marketing, including whether to change the name of the credit union – especially whether to add the word “community” – to better reflect its new status. A decision on a name change should not be taken lightly, she advised. “A name change is not an easy thing to do,” Burton said. “It’s not an easy thing to change.” “Beyond the name change, where is your focus,” she said. “What makes you prominent? There’s a lot of competition out there. You need a well-defined message.” She added that making the switch to a community charter wasn’t an easy thing to do and could cause unforeseen problems. “What about confusion with staff, SEGs, members and the community,” she asked. “When a credit union or any type of an organization makes a change like this, one of the first reactions you’re going to see, especially from your staff, is, `This can’t be good. Something is happening. This may be a last ditch effort to save us.’” Although those thoughts might be completely wrong, she said such “panic” was usually the norm. The danger, she warned, was that such misinformation would get out into the community served by the credit union and damage its reputation. “So you’ve got to make sure that it’s under control, that they (staff members) are looking at this as very positive,” she said. She said staff members could play a major role in promoting the credit union`s message throughout the areas served by getting involved in community programs, ranging from Chamber of Commerce activities to charity events and school, job and health fairs. “This is actually very inexpensive to do and it gets your message out to the marketplace,” Burton said, adding that it was an ideal way for credit unions with smaller marketing budgets to get involved and start building relationships within the community. “Staff is very important to the process,” she said. “They’re out there (in the community) every day.” She recommended that credit unions establish a rewards program to encourage staff members to use the credit union’s products and services. That way, she said, they can have “engaging conversations” with members and non-members in the community, many of whom they know on a personal basis. “I do not want my staff members to push products and services to members or potential members,” Burton explained. “I want them to have engaging conversations because they know the members, they know the community.” Credit unions that move to a community charter also need to ensure that they have the products and services desired by the new area they are serving, she added. Having the capabilities to reach those potential members and to deliver products and services quickly and efficiently can spell the difference between success and failure, Burton said. Those delivery channels can range from the Internet and online loan processing to having a sufficient number of branches and adjusting hours of operation to meet the public’s requirements. “If you were a single SEG (credit union), maybe you were only open Monday through Friday and you were closed on Wednesday,” she said. “Now you have to be open on Saturday morning because that’s what the community wants and needs. “Access is a key to how they (potential members) are going to make their choice,” Burton added. “If you don’t have it, they’re not coming.” Credit unions could also face higher marketing costs under a community charter. “How are you going to get your message out there to the community,” Burton asked. “You’ll probably have to go into different media than you have used before. You’re not just doing an article in a SEG newsletter. You’re not just doing a payroll stuffer.” Among the new options might be radio, television, billboards, trade publications, bus boards, scoreboards at sporting events and community bulletin boards. Direct mail campaigns have to be narrowly targeted, she advised. She said one challenge may be simply getting the community educated about credit unions. She also said that knowing the demographics of the wider area being served was critical. Serving a more diverse population might require different marketing materials and products and services, she said. Knowing the competition – from banks and credit unions to other financial service providers such as Wal-Mart – was also important, she noted. “Shop the competition,” she recommended. “Everybody should do it.” Not only will those shopping forays provide information about the products and services being offered by others, but will give insights into what those institutions think makes them unique. “That is going to help you define your marketing position,” she said. “What do you have that they don’t have?” -