Which credit union will be the last one standing in America? Where will it be located? Why will it outlast all the others?
I don’t have the answers to any of those questions, but after reading an article profiling the last remaining Blockbuster store, I started thinking about the state of our industry. You’ve read the statistics. You know how many credit unions we lose to mergers each year.
In 2004, Blockbuster was a household name, a fixture of the family movie night. More than 9,000 Blockbuster locations lined city blocks and suburban strip malls around the country. But soon, upstart companies like Netflix and Redbox led an onslaught of digital progress that slowly eroded the video giant’s customer base. Suddenly, people had no interest in driving to a physical store and wandering through aisles of movies to find their entertainment. Fast forward to July 2018. Thousands of Blockbuster stores have closed, and only three remained: two in Alaska, and one in Bend, Oregon.
Just a few days ago, the two Alaska-based Blockbusters closed their doors, leaving the Bend location as the last Blockbuster store standing. “Every day, even before this, people would drive by and see the ‘Open’ sign and say, ‘Oh my gosh. How are you still here? Why are you still here?’” general manager Sandi Harding recently told The Washington Post. Her store still buzzes with activity, including a steady stream of gawkers who stop to snap pictures of this nostalgic oddity. Inside the store, IBM computers still run the same floppy disks they used in the 1990s—a fact that shocks the store’s younger employees. “No one can hack these computers, so that’s a good thing,” Harding said.
In 1989, a new Blockbuster store opened every 17 hours. In the late 2000s, stores closed at roughly the same pace. In 1990, there were 14,549 credit unions. As of February 2018, only 5,757 credit unions were remaining. While our credit unions aren’t disappearing as rapidly as Blockbuster stores, you can certainly see the trend. What will it take to stop the bleeding? From what we’ve seen in our work with multiple credit unions across the country, it boils down to one thing: staying relevant.
Because of Blockbuster’s failure to innovate, they lost touch with the demands of their customer base—and the next generation of customers as well. As technology continues to change, making excuses and refusing to innovate will also lead to the extinction of reluctant credit unions. But progress isn’t just about keeping up with the latest technology; relevant products matter too. Are your credit union’s services and loan offerings really meeting your members’ needs?
This fall, over the course of several months, we’ll mediate candid discussions with dozens of credit unions committed to securing their long-term success. They want to make strategic decisions that will help that dream become a reality. They also understand that not making a decision is always the wrong approach, one that leads to the same dismal fate as Blockbuster.
How about you? Are you ready to develop a fresh perspective that helps you make decisions with your credit union’s future stability in mind?