SAN DIEGO-The message from David Polet sounds strikingly similar to an elementary science lesson: For every consumer intention there should be an equal and opposite credit union reaction.

Polet, CUNA Mutual Group's program manager for Voice of the Customer, said there are parallels that can be drawn between physics and business. Of Sir Isaac Newton's three Laws of Motion, he said perhaps the most well known is the Third Law: "For every action there is an equal and opposite reaction," which Polet said has many applications in the CU movement.

"There are several assumptions credit unions make about their members," he said. "It is important to know how things are different across generations, and in different areas."

Newton's First Law also relates to the financial services industry as it has to do with inertia. The First Law states in part that an object at rest will remain at rest unless acted upon by an outside force, which Polet said sums up how consumers view switching financial services providers.

"Overcoming inertia does not happen by itself, the credit union has to apply a force," he said.

Newton's Second Law involves acceleration, and essentially says the greater the mass of an object the greater amount of force needed to move it.

"As members are moving, credit unions cannot use a small amount of force to change their trajectory-they have to do more," Polet instructed.

Thank You, Big Banks

In fall 2011 Bank of America, Wells Fargo and other banks made their much ballyhooed announcements that each planned to implement a monthly fee for debit cards that their respective customers have previously used for free, Polet pointed out. He said the news of the fees became the force that acted upon the inertia of consumers.

"For many months now, new members have been coming into the credit union system, but the big question is, what are they bringing with them?" Polet asked. "In most cases, the answer is checking and savings accounts. But how to enhance the overall relationship? That is the challenge to credit unions."

According to the American Customer Satisfaction Index (ACSI), consumers are more satisfied with CUs than ever, Polet reported, and have tripled their satisfaction lead over banks in one year. While on its surface this is a "good thing," he said, but has not necessarily led to better results. For example, another study found 70% of consumer lending dollars are outside credit unions.

"Credit unions fight being top of mind, and they fight accessibility issues," he said.

Members are "open" to adding more products from their CUs, or at least having conversations, but Polet said it is important for credit unions to talk about their products, and to do so multiple times. He pointed to existing opportunities in investments and insurance, if credit unions would only let their members know they sell these products.

"Credit union members tend to be better educated than bank customers, so they are more likely to invest and have a more aggressive attitude toward risk," he said. "Large majorities of both Gen Y and Gen X believe insurance is a smart way to protect their families, and think insurance is more important than it used to be. There is a lot of opportunity out there. People are thinking about their financial needs. Credit unions need to figure out how to capitalize on these changing attitudes."

Only 10% of members purchased insurance through their CUs, but Polet said those people are "very interested" in getting help controlling or eliminating their debt. He said this open the door for credit unions to offer debt consolidation loans, assistance with credit cards or similar product/service offerings.

Starting The Conversation

"Members don't think of financial events in isolation-things are related," he said. "When someone buys a vehicle the likelihood of insurance products goes up, as does debt protection, individual disability, critical illness and universal life.

"Other opportunities are out there, and members are not opposed to their credit union starting a conversation," he continued. "The talk does not have to be hyperagressive, just ask. Members like their credit unions, but are not always rewarding them. It is important to get to know members and their attitudes. Do data mining and marketing to create opportunity. Past performance is not a guarantor of future behavior."

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