Context change creates opportunity

The future of credit union market development lies in the traditional foundation and strength of the cooperative charter, powered by the personalized member service that has risen from that cooperative charter, combined with the technology advances available to reach the mobile member.  I am very optimistic about the future of credit unions. The advent of the Internet has resulted in unprecedented technology developments in mobility, and it is changing the world we live in.  The mobile revolution is the game changer.

Researchers term this, “an exchange of context.” 1  This new landscape, according to empirical research, is changing behavior and is effecting the value proposition of long-term relationships.  Some may say, “This is bad news.  My long-term members may be at risk.” However, I believe this is a huge opportunity for credit unions to capture enhanced e-commerce potential through a readiness to change attitude generated from their cooperative foundation.

Researchers reported that at the end of 2012, nearly 1.5 billion mobile devices had been sold to consumers worldwide, dwarfing traditional computer sales of the same period.2  Additionally, in the United States, the transition of consumers from dumb phones to smart phones is well over half-way complete.

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This author believes that this change in context is modifying consumer’s view on financial relationships and is creating new opportunities for the ready to change credit union.  Researchers conclude that the value of a buyer-seller relationship “becomes contingent upon the new environmental conditions.” 2   When we consider the demographics relating to the use of the smartphone by consumers, we learn that smart phone use is highest among consumers ages 18 – 44. Further research indicates that this consumer activity relates to electronic payments – financial transactions. 3  This age demographic is the sweet spot of consumer financial borrowing and exactly where credit unions want to be.

How does a credit union utilize the power of the cooperative charter and historical strength of member service to capture this new mobile member?  In simple terms, readily change and go to the mobile member.

In a recent strategy session, I sat across the table from a credit union president and listened to his perspective on the future of branches.  We share a perspective of “lite-weight” branches, with a decidedly retail feel, tailored for the mobile member experience.  The vision summarized – Build a brand that combines financial services with the strength of mobile technology and the traditional feel of personalized availability.  Then, enable the power of the cooperative charter to create brand ownership for the member through strong market orientation that is intently listening for member pain points, and aggressively go to work to build mobile solutions that eliminate them.  In short, capture the opportunity of the contextual change created by the mobile revolution.

At the heart of each credit union’s cooperative charter is the philosophy that members own this financial institution.  Credit unions can harness the power of this cooperative business model by being where members want to be, and building a brand that breeds familiarity.  Building that familiarity creates cooperative ownership and will turn members into a powerful sales force to promote and grow the credit union brand.

For many industry leaders, the demands of regulation and the potential or actual impacts of legislation is the primary focus.  Let me suggest that a readiness to change attitude is not focused on the realities of regulation.  Rather, it is embracing the requirements of being in business, and focusing on the opportunity to evolve and build the value of a cooperative charter by capturing the opportunity created by this context changer, the mobile revolution.

References

1 Ordanini, A 2011, ‘The Ties That Bind: How Cooperative Norms and Readiness to Change Shape the Role of Established Relationships in Business-to-Business E-Commerce’, Journal Of Business-To-Business Marketing, 18, 3, pp. 276-304, Business Source Complete, EBSCOhost, viewed 5 May 2014.

2 Cova, B. & Pace, S. (2006) ‘Brand community of convenience products: New forms of customer empowerment—The case of “my Nutella the Community”’. European Journal of Marketing, 40 (9/10), pp.1087-1105 [Online}. Available from: https://sfxhosted.exlibrisgroup.com.ezproxy.liv.ac.uk/lpu?title=European+Journal+of+Marketing&volume=40&issue=9&spage=1087&date=2006, viewed 23 April 2014.

3 Danova, T. 2013, ‘Tablet market Update And Forecast: Here’s Why Fears Of A Tablet Slowdown Are Overblow’, BI Intelligence 2013, Available at: https://intelligence.businessinsider.com/the-tablet-market-is-no-longer-red-hot-2013-10, viewed 4 May 2014.

Bret Weekes

Bret Weekes

Bret Weekes is the President and CEO of eDOC Innovations, a multi-owned CUSO that specializes in image capture, automation, item processing, and management solutions that seamlessly integrate with the diverse ... Web: edoclogic.com Details