LAS VEGAS–Credit unions need to think of themselves as retailers.
Mark Arnold, president of On the Mark Strategies, Carrolton, Texas, told attendees of the CUNA Operations, Sales & Service Council conference here credit unions “are in the people business, not the financial institution business.”
“Member engagement training is replacing sales and service training,” he said. “If a credit union does not deliver a memorable experience, it is doomed to be a commodity, so credit unions need to develop an experiential strategy.”
Another buzzword in this new era is relevancy, which Arnold said is the key to sustainability. Management must ask how the CU is relevant to its members, he advised, because CUs and banks are all alike to many consumers.
Most people over a certain age know the phrase “Jumping the Shark” is a reference to the television series “Happy Days.” Even for people too young to have watched Arthur Fonzarelli (played by Henry Winkler) jump over that famous shark, the phrase has been used frequently in popular culture to describe a TV show or business that is past its prime.
“Management has to ask if the credit union has reached its defining moment,” said Arnold. “After Fonzie jumped the shark, Happy Days was never the same again. It was a peak, and it was all downhill after that.”
Disney is one of the best at connecting with people on a deeper psychological level, Arnold said. And while every CU does member satisfaction surveys, he insisted those are “worthless” while member loyalty is “priceless.”
“Member satisfaction is just a momentary thing, but loyalty is deeper,” he said. “Success is not about branding, it is about emotional branding.”
Seven Signs Of Shark Jumping
Arnold offered seven signs a CU has jumped the shark:
• Management has never heard of such terms as “tipping point,” “defining moment” or “experience economy.”
• The last strategic plan was written before Y2K (“Make sure strategic plans are strategic, not tactical exercises.”)
• Board meetings begin with “I remember when…” as in “I remember when this credit union had five employees.” Arnold said it is great to have history and build on tradition, but important not to get stuck there.
• No new products have been introduced in the last six to 18 months.
• “Groundhog Day” effect: as in the Bill Murray movie, the CU is doing the same thing over and over again.
• Focus is on products and services, not the brand. Financial services are a commodity, which Arnold said makes branding important from the board room to the bathroom.
* Experiencing the Accumulation Effect. This refers to philosophical changes over time that add up to a CU looking just like its competitors.
“Think of it as a castle and moat,” said Arnold. “The credit union is the castle, the execs are the queens and kings looking out at all the members. Get out of the castle, cross the moat, turn around, and look at the castle from the view of the moat–that is how members are looking at the credit union. Too many times decisions are made from the credit union perspective, not the member perspective. If you don’t, you will jump the shark.”
Other Tips To Avoid Trouble
Other anti-shark jumping tips from Arnold:
* Do strategic planning regularly, at least on an annual basis.
* Develop a vision and a value proposition. Vision must be 10 words or fewer, concise and clear. Staff must know vision, it must be unique (not include word “service”). The Value proposition must resonate, differentiate and substantiate.
• Display passion.
• Focus on members, not numbers. (“If you take care of people, the profits come.”)
• Develop and maintain a strong culture, be it a service culture, a sales culture or a financial culture. (“What the credit union stands for should never change, but how it does things should always change.”)
• Kill a product or project periodically, and don’t have eight different checking accounts.
• Focus on improving sales.
• Protect the CU’s brand at all costs.
• Offer at least two new member-facing products or services each year.