Untapped Opportunities: How to Attract Business Members With Niche Verticals

Many credit unions throughout the U.S. have begun to ask questions about how to evolve their retail focus to include more business members, some going as far as hiring executives with small business expertise and adopting digital tools to prepare their growing departments. This curiosity has only been strengthened since the outbreak of COVID-19, with many credit unions searching for new opportunities to expand their services and provide incomparable value to their communities. These credit unions maintain the goal of “crossing the chasm” – a term coined by Geoffrey A. Moore in his book of the same name – into the new business space. Unfortunately, many credit unions are finding themselves stuck at the starting line, seeking to have everything in place prior to entering the marketplace. Despite such a great interest and initiative to transform their offerings to service these accounts, the task of attracting business members can still seem like a great feat, with many different facets to create and maintain.

To expand their reach and mission to go beyond just personal member accounts to now include business member accounts, credit unions must assess their own community’s needs to provide additional value that’s unique to the area they serve. By pairing these needs with the strengths of their own institution, credit unions will be more apt to choose an obtainable and profitable entryway into the business space.

Remove Obstacles to Progress

A key component to breaking into this space is to remove the obstacles to entry. Often, it is this process of seeking perfection prior to attracting business owners and businesses that holds credit unions back. The problem itself is not the inability to create services that serve every business member before entry, the obstacle is the notion that all business members must be served upon initial launch. It is much more beneficial for the credit union to enter the market by serving a small portion of these clients and growing their services as they align with the needs of their community.

In addition, a lack of time to implement new solutions or locate the right technology to support this growth is a common problem for many credit unions. Fortunately, not every solution takes years to locate and implement and many don’t have to be integrated with core technology. By implementing out-of-box technology that does not require an arduous implementation process, credit unions can go to market quicker, providing the value that people are looking for now, rather than later.

Determine Your Own Strengths

After overcoming these obstacles, a credit union must look to its own strengths to consider what opportunities exist on the business side within its current membership. For example, credit unions may be able to determine that many of their existing members operate the same type of business or maintain similar job roles. With this assessment, they can unlock profitable, niche verticals with which they are already familiar.

In addition to looking at their community, credit unions should look within their own institution to determine what special expertise exists amongst their employees. By matching institutional strengths with the needs of existing members, credit unions will be able to locate opportunities to enter into the business marketplace without extensive training and unnecessary learning curves.

Opportunities Within the Market

The communities in which your members live and work is also a key indicator of where a credit union may find frictionless entry into the market. By analyzing these opportunities, credit unions can locate the niche verticals within their own communities that require immediate action. For example, many communities have an influx of lawyers struggling to manage escrow accounts due to the socially distant environment created by COVID-19. With this knowledge, a credit union would be able to leverage their staff’s existing escrow knowledge to create services that would best serve and attract these business owners.

Untapped opportunities can be located by speaking with clients and businesses regarding the issues that they are running into, as well as which value-added services would pique their interest. Once these possibilities have been determined, it will be much easier for a credit union to close the gaps in services with business offerings.

To have the most impact and traction quickly, credit unions must consider the most effective and influential means to move their competitive space into something new. By considering their own position in their community, each institution has the capability to determine where they might best serve the businesses next door. Regardless of perfection and time, niche verticals provide an excellent opportunity to enter into the business marketplace, expanding their capability though every interaction.

Nathan Baumeister is the CEO of ZSuite Technologies, a fintech based in Burlington, Mass.