Whisper Down the Lane: Understanding How Credit Unions Cooperate

It is no accident that everyone refers to the credit union industry as a community. Credit unions truly are a cooperative network with a shared sense of purpose--and where one succeeds, they all succeed. Credit union executives eagerly share both positive and negative experiences with one another because of this common interest. As one executive explained, …having the guts to share what went wrong [saves] others the pain of learning. Conversely, positive word-of-mouth is often the most effective way to make inroads.

 
 

t is no accident that everyone refers to the credit union industry as a ''community.'' Credit unions truly are a cooperative network with a shared sense of purpose--and where one succeeds, they all succeed. Credit union executives eagerly share both positive and negative experiences with one another because of this common interest. As one executive explained, ''…having the guts to share what went wrong [saves] others the pain of learning.'' Conversely, positive word-of-mouth is often the most effective way to make inroads.

This ideal of ''community'' is what many credit unions feel set them apart most distinctly from other financial institutions. They are not just a community of their members, they are a community unto themselves. Understanding just how strongly credit unions view themselves as unique is critical to approaching the market with a message they will respond to.

''The human body is one of the most complex and most capable creations. Yet it is made up of individual cells that are relatively much simpler. Linked together they produce an unrivaled result. Credit unions [together] can achieve the same result.''

A little lofty? Maybe…but the message is there. Credit unions work best when they work together.

Creating a Message that Speaks to 'Community'

So what does a supplier do with this information? One option is to create a message that underscores how unique the credit union industry is. A credit union CEO we surveyed said, ''I appreciate hearing something that reminds us how credit unions are really different from banks and how we can put our money where our mouths are!''

Point to success stories that demonstrate how a product or service helped another credit union. ''[I am] more interested in credit unions that have [used this service] and actual results,'' than a sales pitch, said another credit union manager.

Propose solutions to challenges that are specific to the industry. For example, a credit union CEO crowed, ''credit unions have a unique opportunity to explain the difference in the relationship that exists between their credit union and its members and a typical bank and its customers,'' only to be countered with the argument, ''How do we get the word out to the general public? Do we pool advertising dollars? How do we compete for market share with the big banks?'' Unlike in the banking industry, where banks actively compete with one another for consumer dollars, credit unions are willing to pool resources to promote the benefit of credit union membership.

There is a small warning that comes with this message. Despite credit unions' shared sense of purpose, it is equally incumbent on the supplier to recognize that, individually, credit unions do have differences. Like a family, although its members may operate as a team, that does not mean all the members are identical. A credit union executive complained about one vendor presentation by describing it thus: ''Comic relief. All credit unions are not the same; just like all banks are not the same.'' Some credit unions serve a tech-savvy membership; some support distinct ethnic communities; and others were created with a single purpose to provide one and only one product to its membership. These differences in membership may require adjustments in language or benefit when marketing a product or service.

Strange Bedfellows: Cooperation...and Competition?

The fact that credit unions work together despite differences in membership or mission does not mean the industry lacks a competitive edge. Credit unions are, in fact, evolving to become more competitive in the financial services industry. Their public profile is growing as they expand their fields of membership and the range of services they offer to their members. At the same time, credit unions remain rooted in their ethic to serve the member AND each other. Credit unions are committed to a common goal of service to the individual, and they are willing to work together to achieve this. The open invitation to the supplier ''community,'' is to help them compete, not against each other because that would undermine the credit union ethos, but against other financial institutions.

Bottom line is, show credit unions that you ''get it,'' that you understand their cooperative foundation and have a product or service that complements this fundamental definition of what credit unions are. Credit unions work together. They are deeply vested in each other's success. When you serve one credit union, you are, de facto, serving the entire community of credit unions.

 

 

 

April 28, 2003


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