Think Virtual When Thinking Credit Union Branch Operations

by: Ron Daly, President/CEO, DigitalMailer, Inc.

There’s a debate within our industry about the value of branches – are brick-and-mortar locations here to stay or is new technology making them obsolete? Credit unions have long been known for their strong member relationships – formed through face-to-face transactions, getting to know members by name, having personal conversations about their financial needs. Some ask how you can establish and nurture these relationships if you remove the in-person aspect of banking.

But others counter that times have changed: More consumers use and rely on convenient technology every day. Members now expect speed and easy access, and they have developed “need it now” attitudes. As a result, financial institutions are beefing up their automated services. And like businesses from other industries, those that don’t keep pace will find it harder to keep their doors open.

No matter which side you favor, there’s no doubt that technology has changed how we operate. Most credit unions use online channels in some form, but these efforts may fall short in meeting members’ changing needs for financial services. Fortunately, technology isn’t just changing your members’ expectations; it’s also providing you with the digital tools needed to keep up.

Not your father’s credit union

Frankly, your largest, most successful branch should be the one without walls – your virtual branch. A strong strategy is the key, and it’s critical for future growth and success.  Digital communication channels and technology have truly leveled the playing field. With the right eStrategy, a $100 million credit union can provide the same services online as a Fortune 500 bank.

Forget the days of needing a branch on every corner to be a market leader. Instead, credit unions that leverage technologies – ATM networks, smart kiosks, shared branching, remote deposit, imaging programs – are effectively managing members’ transactions while providing 24/7 customer service to meet virtually every member need. Putting the “e” in your well-planned, online strategy benefits everyone – your members find greater convenience and simplicity that meet their expectations, and your credit union gains a competitive edge by distinguishing itself from others lagging behind in technology.

Kick-start your eStrategy

Before your credit union can develop an effective eStrategy, take time to review your current offerings to find ways to increase their remote capabilities. Maybe you can update your website to offer more education and online services, enhance your e-banking programs for easier access to transaction and account histories, and add mobile capabilities for account alerts and promotions. Also consider making email, text and voice messaging programs preferred methods of member communication.

After reviewing and updating current programs, it’s time focus on your virtual branch. It’s common for credit unions to have various ad-hoc programs in place that were developed and launched independently – programs that weren’t designed to work together or complement each other. A better approach is to create a comprehensive program focused on increasing service quality and member convenience.  Take advantage of current technologies and incorporate them to allow for better targeting and message personalization, and less dependency on branches. Now you have a strong plan.

To kick start your eStrategy process, here are some ideas:

• Define your goals.  Make sure there is a clear understanding of the direction and desired outcomes of your eStrategy – and that everyone is on the same page. What’s your primary goal? Grow new members or strengthen the profitability of existing members? Cut costs by eliminating paper systems or reducing the branch network? Define your goal and create a plan to achieve it.
• Put the right tools in place.  Smartphones and tablets are changing the rules. If your website’s content is static or can’t be used on new devices, online forms are PDF downloads, or marketing messages are blast-emailed to members, it’s time to upgrade. Replace online functions that don’t support today’s financial services technology and engagement marketing.
• Strengthen contact lists.  Today’s members are on-the-go – you need more than a home address or single phone number to reach them. Building a strong and accurate list of email addresses, cell phone numbers, and home contact information is a must. Equally important is assigning responsibility to maintain and update the list. Of course, sending email and texts is cheaper, faster and often preferred by members, so make them a key part of your eStrategy.
• Develop an “e” position.  To elevate the value of your eStrategy, designate an eCommerce position within your credit union leadership. This position would have the expertise and authority to grow business, develop strategies and align efforts with company-wide initiatives. Also, look at ways to separate your traditional marketing functions from your e-marketing functions. While both are important, they require different tactics and technologies.
• Engage members and build relationships where they are.  Let technology, your data and an enhanced communication network take over to provide consistent, managed contact at every level where members want to conduct business.

Avoid the digital divide

The virtual branch and the digital communication channel levels the playing field for every single credit union in the country to compete with the largest banks. Trouble is… very few Credit Unions use it to its full potential in their branching strategy. Today, the virtual branch is more important – and more attainable – than ever. Tools and experts are available to help your credit union meet the expectations of your on-the-go members, but it takes commitment. In fact, it’s critical for future growth.

By developing comprehensive eStrategy – one that includes digital branch operations, mobile services, online communications, website content/process, email outreach, and social media – you can serve members when and where they want. Done right, you will leverage technology to reduce costs, deepen relationships and grow your bottom line.

Ron Daly is the President/CEO of DigitalMailer, Inc., which provides the self-service digital communication tools that financial institutions need in their virtual branch as well as the expertise and outsourced resource on how to use them in their eStrategy to Connect. Communicate. Grow! To learn more, visit www.digitalmailer.com or call 866-994-4900.