Who will start the revolution?

What does our industry need? In my opinion and based on the last few decades of working with financial institutions is…honestly…a revolution.

Now I know that’s a big term to toss at you, but stay with me.

The hard part about changing the way the world views something is often in getting it started. It’s creating that spark. But even then, the work isn’t done. Once the spark ignites and you begin to see smoke, you have to work even harder to create that one glowing ember. Because once you have that, it catches fire and you just keep feeding it so it burns and burns.

The revolution that I’m talking about, the spark that banking desperately needs is to redefine the purpose of a credit union. To change the way we are thinking about the services you really offer to your members. For centuries, the primary and secondary purposes of a credit union has been to function as a safe place to keep your dollars (if you have extra) and a good place to borrow dollars from (if you have a need).

And in the eyes of most people – not much about the banking industry has changed. While this purpose is the essential function of a credit union, it too often drives the goals and actions of the marketing department: We have too much money so we run an auto loan promotion, or worse even–we just run one because it is that time of year.

But this is what we need to reexamine. What business are we in? Are we a place that stashes away people’s treasures? Are we a place that helps people buy things? Maybe we aren’t even a place at all–maybe we are just an online banking screen that shows people their balances.

What if our primary purpose wasn’t any of those things? What if we started something that would ignite a spark within our members, something that would encourage them to come back to us again and again to stoke the flame? What if it was based on that very thing that nearly every bank on the claims as the thing that sets them apart from the competition: member service, but we took that concept to a new level and really truly and meaningfully helped our members to realize their financial goals. And the best part is—that in doing so, we would inevitably strengthen the credit union and increase our bottom line.

So let’s break it down into steps to achieve this:

1. Call your members and tell them, “we want to share some ideas that we share with our best members, when can you come visit us?”
2. Talk to the member about their goals.

• What do they have going on in their life?
• What are their dreams?
• What do they want to accomplish in life.

1. Create a plan for them to achieve their dreams with the help of your credit union.

It’s a simple change, but one that will change the way your member looks at you, how the community looks at you, and will ultimately lead to how you can change your community.

Here is the strategy behind the concept:

• Make your member feel like they are important to your credit union. Let me allow that to sink in, ‘cause it sounds, simple in theory, but is the foundation for this. Making a member feel that they are important to you is absolutely essential for creating a genuine connection, as most customers, especially those in the millennial generation view banks as fee hungry establishments who are only interested in making money off them. And this is where your credit union sets apart from the bank down the street. You’ll be interested in helping them get a hold of their dreams

• So how do you do this? Sit down with someone to have an in-depth talk with them about their overall financial health. Discuss where they want to be. Then, discuss where they are.

• Create an account for your member using software like Mint.com that aggregates their spending from all their accounts across all financial institutions.

• While you create this with your member you’re going to see all of their information, like loans with others, investment accounts with other financial institutions, credit cards with your competitors…and we’ll get to the beauty of that aspect in a second.

• Now, build a budget with your member to accomplish their goals. The Mint software should make this easy. And then relate it back to their goals. If they are currently living within their means, fantastic. However, we all know that most individuals are not, so this is when the meaningful part of the job comes in.

• So, now you have given them a road map to follow to help them reach their financial goals. You can even set up spending alerts (through Mint and your credit union) to keep them on the right track. And then you can suggest ways for them to situate themselves even better: you can show them how refinancing that mortgage that is currently with Mr. Big Bank will save them $200/Month. Maybe they can save money by switching to your Auto Loan.  Perhaps you can offer a special rate for a money market savings account at your credit union that puts them in a better position to reach their goals. And this is the part where they hug you, because up until this point, no one – and certainly not a bank – has invested this kind of time and interest in their financial success.

• So, you have a really happy, determined member in front of you, and that feels great (leading to increased job satisfaction for your employees), but also, it improves the position of your credit union as well. Most credit unions only haves 3-4 of a given individuals financial products. But average individual has 12 financial products – just spread out at different places. This strategy, though, gives you the resources to gain 100% of your members’ business.

• Okay, so now you’re ready to end the meeting – but before your member heads out the door, set up a time to review how they are doing in 6 months. This next meeting will allow for review of their spending and budgets with them, guiding them through changes if need be.

• And reconnect with the customer every 6 months. These scheduled check-ins also serve as an opportunity to hear about what is happening in their life and to plan for the less-distant future and make changes within the scope of their larger financial goals.

This strategy provides with a meaningful way to attract and retain members from any age group and can easily be modified to include and appeal to businesses.  Not only do you capture their business (score 1 for the credit union), but you start them out on the path of life with financial wisdom and a plan under their feet (which makes them love you. And love for credit unions is something our industry could use some more of). You have sparked their fire for financial independence, and as an added benefit, they are far less likely to fall delinquent on their loans.

Redefining the purpose of your credit union with this kind of a strategy will set you apart from everyone else in your market. It’s no longer about who has the lowest interest rate, or the most ATM locations. It’s about who is real concern for the financial health and success of our communities, of our neighbors – those members we see every week.

Also, you will be able to capture more share of the wallet from your existing members, and I’d argue, their next generation.  And this renewed vision comes with easy indicators for the type of people you want to employ—those who genuinely want to make a difference in people’s financial lives. Now, it makes marketing more tricky than just rolling out an IRA campaign because it’s April – but it allows you to know exactly who in your member base could benefit from an IRA and gives you an established relationship through which to secure it.

So now that we’ve covered the how, the questions turns to “Who?” Who is willing to redefine and create the spark? Who is willing to keep going after that to create enough friction to ignite a burning ember?

Because whoever does will build a fiscally strong member base, and your fire will burn longer. Hotter. You’ll melt the competition.