Canadian credit unions are about two decades ahead of their U.S. counterparts in merging but the practice of dropping “credit union” from the brand is a serious mistake, marketing consultant Tim McAlpine warned this week.

Writing in an e-mail bulletin distributed to clients, McAlpine, a frequent speaker at U.S. credit union gatherings, said he understands the branding rationale and difficulty “if you are called City A Credit Union and you open a branch in City B, your name is no longer relevant.”

Nine of the 20 largest credit unions in Canada, he said, have now dropped “credit union' from their logo “and how they answer the phone.”

Calling the practice short-sighted, McAlpine, said he found it curious that the Canadian industry “is pouring lots of money into campaigns to raise awareness of credit unions as a whole” while dismantling the credit union brand and opting for “Star-Trek-type” monikers.

“Ironically, the largest contributors to these cooperative campaigns are the large credit unions that don't call themselves credit unions,” he wrote.

McAlpine, head of his own firm, Currency Marketing in Chilliwack, British Columbia, is the creator of the Young & Free campaign aimed at a youthful audience.

He said he realizes adding “credit union” to the name makes it longer and lacks awareness.

“But what the heck is a 'financial' or a 'savings'?” he asked.

“Perhaps this is an isolated Canadian trend, but with credit union merger and rebranding activity ratcheting up worldwide, I can see a day when most large credit unions drop 'credit union' from their name,” he said. “This makes no sense to me.”

On mergers, he said the Canadian industry is “about 10 to 20 years ahead of the U.S. system in terms of consolidations” adding that “for perspective, more than 50% of U.S. credit unions have less than $25 million in assets compared to just a handful of credit unions left in Canada with less than $25 million.”