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Counting 15 in '15: CU Growth Strategies
Monday, December 22, 2014 6:45 AM

By John A. Vardallas CUDE

According to the Chinese calendar, 2015 is the Year of the Sheep. Sheep are considered easy going and peaceful, find comfort in a crowd, and have a knack for money. So “going with the flock” regarding dealing with the economy and financial market place will be a harbinger for credit union leadership as we head into the New Year.

Overall, certain aspects of the current American economic landscape have caused many of us to shift to using more common-sense basics and new methods in dealing with our financial situations and engagement in serving members. The credit union movement has always faced challenging times. However, the times we are facing can be considered critical for the future growth and survival of our credit unions and the millions of members who have entrusted us as their financial stewards. Maintaining and promoting our “differentiation” will help solidify the credit union brand in our communities going forward.

The good news these days is mixed. The stock market is at an all-time high, and overall US credit union membership has hit 100 million plus. Loan growth is increasing. Net interest margins and operating expenses are improving. Inflation is flat and the housing market is recovering. However, many Americans are still unemployed or have dropped out of the workforce; household income is stagnant; taxes are going up; and people are feeling the impact of the Affordable Healthcare Act. Regulation is getting tighter, interest rates are ticking up, and more uncertainly, CEO and board leadership are in transition. A high percentage of young adults are not even aware they can join a credit union.

This is the year for credit unions to really step up and help members respond to the "New Economic Normal" to improve their financial lifestyle and well being. I would offer these 15 in '15 suggestions for setting a course to not just survive but thrive: 

  1. Work the Back Yard. Focus on deepening relationships (more wallet share) with your current members. Get close, and really get to know your members.
  2. Review your fee structures for marketplace adjustments. I am not suggesting we gouge our members, only that we alter fees based on the local marketplace. We will still be the best deal in town.
  3. Have a collaboration, partnership, alliance, and merger policy/strategy.
  4. Train staff to cross serve/sell and wow members at every touch-point opportunity 7x24x365. Embrace being a "member-centric" credit union. All staff, volunteers, vendors, and members should be advocates for your credit union.
  5. Use good onboarding practices to reconnect and engage current and new members by offering incentives (buy local Groupon/ miles/reward programs/prepaid cards/cash back/free credit reports) and concierge services to empower them to connect. Give members real reasons for being members, not just customers. Membership should have its privileges. Offer a certificate of member ownership/toll-free 800 member care number.
  6. Create a strategy to reach out and serve new Americans and the underserved. We are at the point now for action in reaching out to immigrant consumers in our communities and bringing them into our credit union family.
  7. Embrace mobile/tablet technology and social media. Utilize innovative ideas to create "apps for this and that," do not fear Facebook, and learn to Tweet!
  8. Offer tax/legal (wills) services and end-of-life (burial) loans. Look for non-traditional/lifestyle products/services from which your members could really benefit.
  9. Reach out to young adults and women via micro lending, small business services, HSAs, and lifestyle lending products.
  10. Consider starting a CUSO to offer insurance/travel/HR/IT/DP/products and services.
  11. Stop asking Gen Y why they do that? Make it a strategic imperative to appeal to and attract more youth and young adults. The under-30 demographic is your next generation of lending business and lifelong members for your credit union.
  12. Focus more on diverse non-interest income streams (debit card/gap coverage/credit insurance/debt protection/overdraft/interchange fees/investments/brokerage services) to help improve your bottom line.
  13. Get the right staff in the right seats on your credit union bus and empower them with a license to serve members.
  14. Reach out to boomer/senior members with retirement planning and long-term health care products/services.
  15. Embrace mobile wallet technology to serve members conveniently and teach them to self-serve.

If we are not only to survive in the future but thrive, we will have to develop a different strategic mindset about growth. Our leaders will have to strategically focus more on innovation vs. tradition and execute faster at a greater level than the competition. Credit unions will need to fine tune and focus on our commitment to members to keep up and stay ahead of the herd in the changing financial services marketplace.

Haaaaaaappy New Year!

 

John A. Vardallas (CUDE) CEO/Founder of TheAmericanBoomeR Group, Madison, Wisconsin, is a professional speaker/business consultant and strategic planning facilitator to the credit union system. He is senior faculty strategist for the Southwest CUNA Management School. For info: www.theamericanboomer.com.