Timing A Good Name Change

Lockheed Federal Credit Union is the latest credit union trying to connect with potential members by shedding its exclusive-sounding name.

 
 

Like Lockheed Martin Federal Credit Union, many credit unions that have long served only the employees of a particular company are looking for the perfect new name to help them reach the broader community and avoid discouraging potential new members.

Lockheed Federal Credit Union ($3.3B, Burbank, CA) will become Logix in July after the credit union conducted a year-long test to determine how its name was perceived within the community, according to a press release. It learned that its name created confusion because people weren’t sure if they could join if they weren’t Lockheed or government employees.

"We are very excited about our new name and the future of our credit union," Lockheed FCU president and CEO Dave Styler says in the release. "We're tremendously proud of our history and heritage. This change is one of many steps we are taking to positively position the credit union for sustained, healthy growth for the next 75 years.”

Lockheed FCU landed on its new name to encourage would-be members to envision it as a “smarter, more logical choice.”

Credit union name changes often present an additional layer of complexity not found in other business categories, as written in the article “What’s In A Name? Plenty.” Often, the impetus for a name change among credit unions is triggered by the organization changing its charter to serve the larger community in addition to legacy employee groups or single sponsors. The challenge is to acquire new members with a more community-oriented name and brand without alienating the existing member base.

The solution is a balance between the past and future. Some brands have found that balance better than others. There are great past examples of names that serve "double-duty":

  • Hewlett Packard FCU re-branded as Addison Avenue FCU. Addison Avenue is the street in Palo Alto, California where in a small garage Bill Hewlett and Dave Packard launched the startup that would grow into Hewlett Packard. Diehard HP employees and fans recognize the connection, yet the community "hears" a pleasant sounding "place."
  • Class Room Teachers FCU in Louisville, KY adopted the new name Class Act FCU. Though similar in name to maintain continuity, the new name eliminates any confusion as to whether the institution is "just for teachers," while also carrying a very positive connotation about the organization's service commitment.
  • IBM Texas Employees FCU became Amplify FCU ($596.4M, Austin, TX). Amplify pays tribute to electronics but also reaches the realm of personal finance, suggesting the credit union can help consumers increase wealth and financial security. Amplify is a great electronics-oriented moniker but also offers tremendous branding potential in discussing personal finances.
  • FAA First FCU to SkyOne FCU ($355.8M, Hawthorne, CA). This is different than the other examples because the credit union didn't "go community," but it expanded its field of membership from FAA employees only to the broader nationwide transportation industry.
 
 

May 10, 2012


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Comments

 
 
 
  • I agree with the above comment. Exclusivity is one of the most powerful principles of persuasion / influence. While not credit union related, USAA is only for military personnel and their familiies. People beg to get USAA's insurance that aren't in the military and their customer service is always rated at the top. I know people that kick themselves all the time for dropping USAA when they were military dependents and now can't be a member again. But now USAA is debating on going public like GEICO (which was original military only) did decades ago. There is nothing special about GEICO - no one is beating down their door to join. When you bring in the principle of exclusivity, people that can't join go crazy. Look at Facebook - anyone could join MySpace, but Facebook originally only let you join if you were in college. People lied their way into getting a Facebook account and it exploded. They eventually had to open it to everyone and the rest is history.
    Brandon Diehl
     
     
     
  • I couldn't disagree more with this decision. The title of the article tells the story - Lockheed sheds its exclusive sounding name?

    Lockheed is not a name - it's a brand, years of reputation AND just for fun the employees that created the financial cooperative. When a credit union uses the excuse of "people don't know they can join" to destroy brand equity I have to laugh. Members tell you that (in focus groups) because they don't want to hurt your feelings. If people really WANTED to join your credit union - they would call and inquire if they could.

    I worked with Coors CU some years ago - the were considering a name change for the same reason - only we came to discover that there were members that had lied their way in - claiming to be a relative of a Coors employee. The name didn't stop them - the name lured them in.

    The solution - expand the charter - but don't destroy the brand.
    Denise Wymore