Better Together

Originally appeared in CUES Credit Union Management

Marketing and technology together forever

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Strawberries and chocolate. Peanut butter and jelly. Ham and cheese. Sometimes a thing is wonderful on its own. But add another ingredient and you have perfection. So it is with marketing and IT.

Can the marketing department and the IT department at your credit union work more effectively together? I believe they can—and should! On its own, credit union marketing is often inspired, creative and fun. But combine it with powerful IT and it becomes much stronger.

A point of clarification: When I say IT, I’m referring to a holistic view of information
technology, including product and app development, not just the folks that keep the servers secure and fix your email when it’s not working.

The Stereotypes 

On one hand we’ve got the super nerds in IT with their pocket protectors. These folks are super intelligent, very calculated and total control freaks. Planning and scheduling is their strength and security and uptime are their biggest priority. When they are not playing World of Warcraft, they believe they know more than anybody at your CU and tend to look down on those less technical.

On the other hand, we’ve got the romantic artsy-fartsy scatter brains in marketing. These folks are creative, confident and flamboyant. They can be impetuous and flaky. Their ideas are bigger than their budgets. They are glorified party planners, and, speaking of parties, they would rather party hard than listen to what the nerds have to say!

Differences and Commonalities

IT types and marketing types have radically different perspectives on time and time lines. They have very different definitions of what’s important. IT wants to secure everything, which leads to a locked down approach, while marketing wants a sandbox to experiment in. This tension can lead to conflicts and potential risks. It’s like high school all over again, but instead of jocks vs. nerds, it’s liberal arts vs. information technology.

But these two seemingly opposing forces do have some things in common at your credit union. Both departments can suffer from a superiority complex, and both have a tough time showing a return on investment. Many CEOs and CFOs see both marketing and IT as expense centers instead of profit centers. Both are seen as black magic voodoo to outsiders, and both struggle to get a legitimate seat at the executive table. Plus, your branch staff think both marketers and IT staffers have cushy jobs at head office.

Marketing types used to be seen as the only cool kids, but that’s changing as well. Geeks are the new rock stars. With the rise of the Internet, social networking and smartphones, being technical will no longer get you ostracized, it will open doors. The average salary for an engineer at Google and Facebook is $125,000, not counting benefits, 401(k) matching and stock options.

In many cases, developers, engineers and other technologists have become the new product people and visionaries. Mark Zuckerberg and other young tech CEOs have become the new role models to the next generation of leaders and they are crossing over into the financial services industry. For example, Jack Dorsey, the inventor of Twitter, is now the founder of Square, the super-hot payment start-up.

The New Reality

It is obvious that CUs are operating in a changing environment. Not only do we compete against big and small banks and other CUs, we also compete against alternative lending companies and, increasingly, against media and technology companies. The thing to be very concerned with is that consumers are beginning to see these media and technology companies as better equipped to help them with their financial needs. 

Consumer needs have shifted and we need to be very sensitive to what our members and potential members find important today and into the future. In a recent survey, CUES Supplier member MasterCard, Purchase, N.Y., found that 63 percent of the population is comfortable with making payments on their smartphone as soon as the service becomes available to them.

The mobile wallet is already here with Google Wallet, and Apple has released Passbook in iOS 6. Passbook (a mobile app that stores coupons, boarding passes, tickets, store cards, etc.) is a first step and mobile payments will be coming next.

Neither Google nor Apple want to be banks—they are giving financial institutions the API (application programming interface) tools they need to be front and center for their customers and members. Now it’s up to CUs to take advantage of this invitation.

Superior in-person member service is also no longer a strong enough differentiator. Consumers are seeking out do-it-yourself tools instead of talking to branch staff. According to a recent Filene Research Institute, Madison, Wis., report titled Young Adults Evolving Financial Preferences, 86 percent of online bank customers said customer service is the reason they would not switch. Think about that for a second. There is no customer service with online banks! Great technology that just works is more sticky than nice people.

It’s not all hypothetical either. Just look at the new, totally online banking startups like Moven and Simple to see what happens when design, technology and user experience come together seamlessly with marketing and social media.

Because of these trends and many real-world examples, the successful credit union of the future really needs to see itself and portray itself as a tech company. This also means that credit unions should likely be in better control of that technology in the future. As we move further and further away from real-life member service, it’s more and more about the do-it-yourself user experience.

The completely separated siloed approach CUs have taken with marketing and IT will not be effective in the future. Have you been in a brainstorming session lately? Have you noticed that every good marketing idea has some online or technical component to it? Or how every new technology needs good marketing?

The digital and mobile experience are just as important as the in-branch experience. The Internet has leveled the playing field and we need to be thinking like e-commerce companies. Look at the end-to-end online shopping experience with Amazon. It’s easy to find stuff. The recommendation engine is smart. One click check-out is dead simple. This type of user experience has become a basic expectation for consumers. 

And it’s not just the tech heavyweights and new fin-tech start-ups. PNC Financial Service Group, a big Midwest bank, has a killer banking application called Virtual Wallet. Launched in 2009, it just keeps getting better and better. It is not a slapped on personal financial management tab within online banking; Virtual Wallet is an end-to-end money application specifically developed for Gen Y.

It’s beautifully designed and really well marketed. You can’t do this without marketing and technology being totally integrated. PNC has reported that it opens 6,000 Virtual Wallet accounts per week specifically with 18- to 34-year-olds.

Seamless, helpful technology will trump the feel-good CU story any day. It’s sad but true and it’s time for CUs to really step up. Here are six ideas to consider for bringing your marketing and IT departments closer together.

Idea 1: Understanding and Education 

Marketers and technologists need to better understand the actual business of your CU. Everyone in marketing and IT should spend time throughout the organization including time on the front line and in the call center. They need to understand treasury and how your CU actually makes money. This goes for your vendors as well. Do your marketing and IT vendors actually know how your CU makes money? 

When your people know how your CU functions, they will have much deeper insights and creative ideas on how to improve processes, market your services and differentiate your CU. This can also build real competence and understanding with the young leaders within your CU.

Idea 2: Building a Cross-Functional Team

There’s a lot of talk about cross-functional teamwork these days and for good reason. A cross-functional team is a group of people with different functional expertise working toward a common goal; typically, it includes employees from all levels of an organization and from multiple departments. Some forward-thinking CUs have used the cross-functional concept and created an e-commerce department that bridges marketing, IT and sales. This approach treats the online channel as an important sales and service asset and is totally integrated with the CU. This really requires building an e-commerce competency as well as product and channel management within your people. CUES School of Product and Channel Management led by Cornerstone Advisors and CUES School of Strategic Marketing led by Weber Marketing are two things to consider for key people.

Your work environment is so important. Steal a page from the tech start-ups with their open space plans. There’s nothing fancy about these spaces—they throw a bunch of people into a big room and make stuff. Get away from the cube farms. They do not promote collaboration and they can slowly suck the life out of your people. Think collaborative not segregated. Inspirational not corporate. Casual not stuffy.

Idea 3: Clarify Policies, Ownership and Promotion

Some of the confusion and friction between marketing and IT stems from ownership. We now have all these properties at our credit unions that cross department lines. Who owns the website at your credit union? Who owns blogs and social media? Is the social Web open or locked down at your CU? Marketing typically wants things open, while IT wants things locked down. Is there a more workable compromise? Who owns iOS and Android mobile app development at your credit union? Who owns PFM, online account opening and remote deposit capture?

With two divided factions—marketing and IT—the answers to all these questions are murky. Both departments should have an equal stake in all these technologies or, at the very least, work together to implement and promote them.

Idea 4: Formalize Workflow

You should have IT people at the table from the start on all major projects. Not only for feedback, but also for ideas and different perspectives. You should have a project or production manager within your organization that gets both marketing and technology. Someone who can clearly defined phases, deadlines and responsibilities and then manage in-house and external resources. Think of this project management role as your CU’s air traffic controller. The advertising agency world does this really well.

What tools are you using to manage your projects and campaigns? There are inexpensive project management tools, such as Basecamp or Do.com, that can really help cross-functional teams work well together. 

How are you building stuff? Do you outsource to large vendors? How about independent freelancers? Or do you do everything in-house? On the marketing side, these questions apply to design, copywriting, video production, social media and photography. On the IT side, these questions apply to coding, security, Web development and app development.

Are you building Hollywood-style teams? Meaning, are you bringing diverse perspectives and skills together to build something and then dismantling the team after the project is completed? This can be a really good model to think about and can save money. Use the best internal and freelance people at the right time and then move on. 

$44 million /2,000-member Mount Lehman Credit Union in Mount Lehman, British Columbia, where I serve on the board of directors, is a great example of a CU that uses Hollywood-style teams. With only 12 employees, it is one of the most tech-savvy CUs in Canada. For instance, Mount Lehman CU built a real-time text-messaging application using freelance programmers. This product was first released in 2005, a full six years before any other financial institution in Canada had any sort of mobile alerts. By using freelance talent when it makes sense, Mount Lehman CU has built all sorts of awesome products. You don’t always need to go outside to technology vendors even if you don’t have the talent on the payroll. 

There is no single right answer for your workflow. Ask yourself these questions to help determine the right fit for your CU: Do you have a do-it-yourself culture or are you totally dependent on outside consultants and vendors? Does everything need to be created within your organization or is your CU open to partnering with outside marketing and technology vendors to help you get out of your box or limitations? There should be a healthy mix; you can’t do everything alone, yet you shouldn’t be totally dependent either.

Idea 5: Keep Things Nimble

One fear of aligning marketing and IT is that things will slow down. This can definitely happen with software development and we don’t want that mindset to overtake the nimble marketing mindset.

Consider a rapid prototyping and testing model. This is from an IBM abstract written in 1990, “To prototype successfully, pick a rapid prototyping tool that meets your needs, form a small prototyping team, get lots of customer feedback, and iterate until customers are delighted with your user interface.” 

This isn’t just for hardcore software. This methodology can be applied to marketing and Web and app development. I recommend reading the book, The Lean Startup, How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. This is a modern take on the rapid prototyping and testing model and has great information for both startups and established companies like credit unions.

The point is to iterate and improve often with everything you are doing in marketing and technology. The ironic part to me is that most CUs stop at the first iteration of most initiatives.

For smaller credit unions, you really need to lean on your technology vendors. How open are they to working with marketing people? Do your vendors understand how marketing and technology must work together? Are there CUSOs you can partner with or even start on your own or in collaboration with other like-minded credit unions?

On the marketing side, you need competent digital agency partners that understand traditional and digital marketing as well as how technology is changing the financial services space. You need to decide between industry specialists or local generalist firms. Both can make sense in certain situations.

Idea 6: Inspire Your People

Your people need time to think about big ideas and to get out from the whack-a-mole day-to-day grind. Get your people out of their comfort zones with magazines, websites and blogs that make them think. Magazines such as WiredFast Company and Communication Arts, not just CU ManagementCredit Union Times and The Credit Union Journal. They should be reading blogs and websites as well, like Mashable, ReadWriteWeb, TechCrunch and Reddit.

Send key people to conferences outside the credit union industry. For instance, I attend SXSW Interactive in Austin annually in March. It attracts more than 20,000 people every year. It’s a real eye-opener on technology, consumer and digital trends. I also think more credit union people need to attend Finovate to get a broad perspective on the future of consumer finance. Imagine two packed days of fintech demos by countless new and established tech firms that are all clamoring to reinvent consumer finance. It’s held in San Francisco in spring and New York in fall.

For larger CUs, could you employ some thing like Google’s 20 percent time? As a motivation technique, Google uses a policy often called Innovation Time Off. Google engineers are encouraged to spend 20 percent of their work time on projects that interest them. Some of Google’s newer services, such as Gmail, Google News, Google+ and AdSense originated from these independent endeavors. In fact, half of all new product launches at Google have originated from the Innovation Time Off.

Looking outside the industry is important for inspiration and new ideas. But so is networking within the credit union world. I encourage you to get more employees involved with CUES and really dig into the services that are available as members. Check out the CUES Advancing Management Group Membership to get as many people in your CU involved as you like. 

Belong to the Filene Research Institute and utilize its deep research and open-source ideas. In fact, why not encourage your emerging leaders to get involved with Filene’s i3 program?

The Time to Start is Now 

I’ve given you lots to think about and consider as you move forward. At the very least, start a dialogue between marketing and IT. Get your people out of their comfort zones and expose them to broader perspectives. Why not start simply by trying two or three of these ideas at your CU and see where things go?  Put some desks together and try a cross-functional project. Try out a simple online project management tool like Basecamp. Hold regular cross-functional production meetings. Most of all, attack the future head on. 

Can the marketing department and IT department at your credit union work more effectively together? I believe they can!


Tim McAlpine lives in Chilliwack, British Columbia, Canada. He is the President and Creative Director of Currency Marketing, an integrated marketing agency specializing in helping credit unions attract the next generation of members. Tim is best known as the creator of Young & Free and CUES Next Top Credit Union Exec, and co-creator of the CU Water Cooler.