Sometimes the Best Thing a Credit Union Can Do Is Give Up ‘Credit Union’

by: Sarah Snell Cooke, Editor-in-chief, Credit Union Times

The former GTE Federal Credit Union recently announced that it was changing its name to GTE Financial. Period. No credit union.

The idea has raised the eyebrows and ire of some in the credit union community. To me, it was one of the wisest things the credit union could have done. After researching its membership and nonmembers, the credit union found it was better off without “credit union” in its name. It also wisely chose to keep the GTE, again based on member and nonmember survey data.

When considering something as important as the name of your organization, it’s crucial that member feedback play a role. It’s also key that the new brand pay homage in some way to the original brand while taking a step forward. Keeping GTE as part of the moniker was important to the survey respondents.

On the other hand, the credit union part was less important. Only a handful outside of the credit union community knows what a credit union is–including members. And most don’t care. Consumer care about what credit unions (even if they don’t know the name) can do for them. This is part of why the bankers are so up in arms and got the Vermont state regulator to issue a notice of intent for a cease and desist for using the term “banking”: consumers might actually figure out what credit unions do!

For John Q. Public, the name GTE Financial is much more illustrative of what the organization does than GTE Federal Credit Union. It’s great to be proud of who and what you are, but if no one knows what you can do for them, it doesn’t matter much to the business. “Credit union” has had more than 100 years to get off the ground–it hasn’t. What’s the marketing ROI there?

To be fair, pockets do exist where certain credit unions or credit unions in general enjoy some name recognition, but that is not standard nationwide or the industry wouldn’t be having this debate still. If it were, credit unions would be growing much faster than the U.S. population growth at a time when many consumers despise banks.

Get the consumers in the door first, and then explain to them about credit unions. The name on the door doesn’t matter – it’s what is on the inside that counts.

Sarah Snell Cooke is the Editor-in-chief of Credit Union Times, a Summit Business Media publication since January 2008. Prior to that she covered Washington, D.C., news for CU Times starting in September 2000. She also was previously writer/editor for Credit Union Regulatory Insider. Sarah can be reached at scooke@cutimes.com or 202-370-4802. Follow her on Twitter: @CookeonCUs