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Growth Opportunities Abound, But Old, Weak Messages Won't Get the Job Done

There's been a lot of speculation around our industry that all the chaos in the economy in general, and banking in particular, should be good for credit unions. Confused and frustrated bank customers are looking for financial services options that make them feel secure, and people with good credit histories are looking for institutions willing to lend for necessary expenses such as college, to replace a car, etc.

Are there growth opportunities out there for credit unions in spite of the economic uncertainty?

While conditions vary considerably by market the, overall answer is yes — credit unions should be focused on growth. In the hot economy of recent years banks had the advantage of the status quo. Customers were more focused on spending than saving and most people weren't examining the fine print of bank statements to seek out fees and charges.

That has changed. People are examining how they spend and are looking for ways to save. And with major banks caught up in buyouts and bailouts this is a good time to be heard when you aggressively "sell" your credit union as the right choice for a primary financial services provider. Stop thinking just auto loans and start thinking more about checking with direct deposit tied to your other eServices.

Even better-the cheapest and easiest time to buy increased market share is in a down economy. There are reams of data that show that companies that market aggressively in a down economy benefit exponentially when the economy rebounds.

What does it take to position your credit union for growth today? The same things it takes in any economic environment in any year. You need to commit the resources to support a consistent, targeted, effective marketing effort. Consistency in media and in messages is at least as important as maintaining basic spending levels.

And you must remember that you're not just building awareness, you're creating your brand identity in the marketplace. If you want to compete with banks you need to dress the part. It's time to become more sophisticated and more aggressive in your branding and messaging efforts.

What should your CU spend yearly on marketing?

  • 0.25% of assets at a minimum. Normally I see between .15-.20% of assets, so anything below this and your marketing budget is underfunded and brand equity would be non-existent beyond your core member base.
  • 0.50% for a large SEG or near community.
  • 0.75% to 1.50% for a community charter.
Whatever you are allocating, remember this, also: "quality creative matters." Buying "put your company name here" prefab ads filled with dated stock photos are not going to build your brand. It actually does the opposite and waters down your brand equity. You need a professional brand, consistent impactful ads and branch collateral tied to your websites to be successful. Remember every touchpoint must build on and off from your brand.

This is a good time to position your credit union for growth. But you're not going to get it with the same old weak messages and intermittent ad buys-consistency and frequency are the critical components to successful marketing and branding. It's a whole new world out there. Doing nothing is no longer an option. It's time to grow.

Paul J Lucas is a national marketing and branding consultant. For more information log on to www.PaulJLucas.com or email paul@pauljlucas.com.

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