Operating expenses are declining nationally. Although this is good for the bottom line, it creates a growing challenge for credit union marketers: How do credit unions spread their messages with less money? This can be a daunting task in any market, but it is especially discouraging for credit unions in large metropolitan areas where traditional media costs are high.
But credit unions still have a cost-effective resource at their disposal — member loyalty and the powerful word of mouth (WOM) marketing that comes with it. For some credit unions, such as San Francisco Fire Credit Union ($664M, San Francisco, CA), creating member loyalty is a major focus of their marketing strategy. San Francisco Fire is committed to creating the best member experience possible, which has led to membership growth rates in the double digits and positive reviews on sites such as Yelp!. Referrals are the way this credit union grows; read more about its strategy in “The (Nearly) $0 External Marketing Budget.”
San Francisco Fire is inspiring, but think before you scrap your entire marketing budget. There is no one right answer or single approach that works for all credit unions, even for those with similar characteristics such as asset size or field of membership. What all credit unions do share, however, is the need to generate a base level of awareness to become a consideration in members’ financial decision making process. It’s like choosing Cheerios at the grocery store instead of the off-brand Toasted-Os. Advertising — in addition to past experience — plays a role in that action. Choosing a breakfast cereal might not come with the same consequences as choosing financial products, but both are commoditized markets and initial brand awareness is critical.
Firms such as LeadFusion that focus on the online channel to create consumer advocates have researched the various financial decision-making phases. There are typically six distinct phases consumers go through, beginning with engagement. In this phase, consumers look to “reliable online resources” for answers to their personal financial questions. It is vital your credit union is on potential members’ reliable list or has a presence on a site that is. Correctly managing the financial experience — online as well as through other channels — will determine whether you gain a happy, loyal member or lose someone to a competitor during the engagement phase.
In today’s recovering market, credit unions will undoubtedly continue to carefully manage operating expenses, and marketers will continue to face the challenge of doing more with less. But credit unions have loyal members, and the potential to leverage new, cost-effective channels to create more advocates, in their corner.