CU in the Community (Part 3 of 3)

So, we’ve discussed how to collect the info needed to create a great involvement plan, and tossed around a few ideas on how to put that info into action. Today, we discuss the effects that a robust involvement program should have on your overall brand.

Now, keep this in mind as we begin, your brand is made up of many aspects of your credit union, and all of these things have to add up to a coherent picture. However, your community involvement can go a long way to solidify the image of your brand.

By giving your employees an element of ownership in your involvement program, and by getting those people out to connect with the community on a personal level, you can build a very authentic and meaningful presence.

By placing your credit union in the position of “community provider” (isn’t that what credit unions have always been?) you can really drive home the philosophy that credit unions are founded upon.

“People helping people”!

“Not for profit, not for charity, but for service”!

Truly live up to these philosophies, combine them with a well defined and unique brand (a topic for another day), and a robust account acquisition/on-boarding program and you will see an increase in community recognition,  an increase in the type of members and accounts that you desire, and an influx of loyal members who care about who you are and what you do as an organization. Just make sure you continue to care back.

Movie Theater Syndrome

A few nights ago my girlfriend and I went to see National Treasure 2 (which was surprisingly decent). So, we got our tickets and went to get some popcorn and soda. On the wall behind the counter was a menu with combo’s of soda, popcorn, and candy…but no prices.

So, we decided to share a popcorn and get a couple of soda’s. We asked the cashier, “how much is the #2 combo?” The answer nearly knocked me over, “it’s 17 dollars”. Wh-wha-what!?

To me this just seams like poor business practice.

Here’s how I see it. Somebody in an office at theater HQ decided it would be a great idea to raise the prices a bit on concession at the theater because, well, “people are going to buy it no matter what”.

This little plan backfires as more and more people (like me) sneak food in from Walmart because we refuse to pay 5 bucks for a medium soda.

The same guy at HQ panics as profits from concession begin to fall again. In an effort to keep profits up while customers are down, they raise the price again. Less and less people buy their movie eats at the theater itself, and the prices keep rising in an effort to keep profits up.

On, and on and on…Until I now have to fork over $17 for a couple medium sodas and a popcorn. Needless to say, we got a water and moved on.

And they wonder why theater attendance is down…

What does this have to do with credit unions you might ask?

Aside from the fact that we might have to start offering small loans to buy food at the movies, its a great example of a pitfall we want to avoid.

Unfortunately membership growth at most credit unions is pretty stagnant and margins are crunching. Its easy to get caught up in this thinking. If new people aren’t coming in, and the people we have aren’t making us the money we want, we could just charge people a bit more and get back some of that profit in the form of fees.

In my opinion that is counter productive to the growth you’d like to see. Adding a new fee or raising an existing one is just a temporary patch on a much bigger issue. If anything, raising the cost of having an account is going to drive more people away.

Just like raising the prices of food at the theater, it might hide the symptoms for a bit, but then what? Where do you take it once profit levels off again?

The rise in fees creates an illusion, it tricks the numbers into showing you what you want: an increase in profit. Once they get out of hand (like 17 bucks for a couple sodas) you’re in trouble. The people that were making you that profit on fees will start looking for other places to put their money.