10/05/2008

CU Branding 101: What's the difference and does it matter?

By Tim McAlpine

There were many highlights at the FORUM Solution/Trabian Partnership Symposium, but the best part to me was the unveiling of the CU Skeptic. We now all know that the CU Skeptic is Mark McSpadden from The Garland Group and the host of Banktastic TV's the CU Scoop.

Mark did a great job of presenting his case. One of the screens that he employed to prove his point was simply titled "The Difference Between Credit Unions and Banks" which was followed immediately by a blank screen. In Mark's sub-30 Gen Y opinion, there is absolutely nothing different between the two. We can all go on and on about the member ownership, the not-for-profit structure and the community centered focus, but to the Skeptic and in his estimation, to the general public these things either don't matter or are completely invisible.

Mark's blogging as the Skeptic grew out of being tired of the credit union cheerleaders (including yours truly) blogging about how great and different credit unions are.

Does the difference between credit unions and banks even matter?

The problem with this age old comparison is that the differences are subtle and the differences are often different!

Ultimately, each credit union needs to be relevant and desirable to its own members. This point was brought home by William Azaroff presenting his story about Vancity (400,000 members and $14B in assets) and Gene Blishen presenting his story about Mount Lehman Credit Union (2,000 members and $40M in assets).

Other than both being credit unions, these two institutions have absolutely nothing in common. This is a good thing, because both serve a very different group of people and both of these credit unions are very successful.

So why the fixation on a national brand campaign?

A recurring theme at these events and online is the need for a nationwide brand awareness campaign in the US to illustrate the difference between credit unions and banks. In theory, this is a good idea, but the main problem is that large groups of credit unions can never agree on a compelling universal difference.

Since hearing the Skeptic's talk, I have had this mock meeting conversation rattling around in my head.

The scene: the Motel Owners Association National Convention 300 motel stakeholders have congregated to discuss the need for a national branding campaign. "We need to get the word out that motels are better than hotels. Those hotel guys are eating our lunch." "Yeah, hotels are all about making the big profits. Motels are an affordable alternative. So first of all, let's decide on what makes us different." "Doors on the outside?" "No, we have halls at our motel." "How about anything under two floors?" "Nope, we have three floors." "Kitchenettes?" "No. Some hotels have kitchenettes. We can't use that." "What if we go after the business practices of the hoteliers?" "Not our style. Besides, we'll have the tourism regulators kill our campaign." Two hours later after serious brainstorming and debate, two final message emerge that all 300 conference delegates can agree on: "Motels... Our towels are slightly scratchier." "Motels... It is 68% fewer steps on average from car to pillow."

 

But perhaps now there is a compelling difference that needs to be told

With the big banks in the US in an endless downward spiral, now would be the time to promote a unifying difference between credit unions and banks. A message of trust would resonate more today than ever before.

Will it happen? Not likely. There are too many cooks and there is fear of casting any doubt towards the stability of the big banks.

Bottom line:

Defining and promoting your credit union's brand is your problem. Do everything you can to stand out against the competitors in your marketplace. Lean on some of the global credit union differences if that makes sense in your situation or define your own difference and stick to it over time.

The CU Skeptic provided all of the Symposium attendees with a splash of cold water. Thanks Mark!

---

Comments

1) CU Skeptic @ Oct 06, 2008
http://cuskeptic.wordpress.com

Tim,

Thanks for the kind words about my presentation and unveiling.

I LOVE the hotel/motel analogy. It's spot on! Keep'em coming!

2) Dean Wilson @ Oct 06, 2008
http://www.focus-cu.com

Tim,

While it's true gettign consensus from credit unions is like herding cats, right now we finally have an opportunity to reinforce/reinvigorate the differences. Our lack of national leadership leaves us in a constant defensive battle with our for profit brethren. I think when we think small (status qou) we do a disservice to not only the thousands of my members who can't tell the difference but the other 200 million American households who assume we are connected to the teamsters. Not to sound like a broken record, but we finally have a stage to shout from and we shrink back to the shadows as we have always done. The adage about leading from the back of the pack is so true for our movement right now.

3) Jeffry Pilcher @ Oct 06, 2008
http://www.thefinancialbrand.com

You're talking about two different things here:

1. Finding a relevant difference between ALL banks and ALL credit unions. 2. Finding out how YOUR specific credit union is different from ALL other banks AND credit unions.

And you're right. If the CU industry can't get off it's ass and put out a campaign right now — when the opportunity is as ripe as it will ever be — then this idea should be scrubbed and forgotten forever.

4) Ron Shevlin @ Oct 06, 2008
http://marketingroi.wordpress.com

Tim --

Great post. The hotel/motel ...oops... motel/hotel analogy is spot on.

As I see it, what makes a national CU branding campaign or concept a questionable idea is not so much coming up with a message, but because of two other issues:

1) Meaninglessness. Whatever message a national CU campaign came up with would be meaningless for a large percentage of both the consumer and CU population.

2) Execution. It's the problem any one organization has in delivering on a branding effort. A branding message establishes expectations in the minds of the target audience. Even if CUs could get together and decide on the message, I have trouble believing that all could deliver on it -- which would lead to more in-fighting and finger pointing.

IF CUs do still want to move ahead with a national campaign, here's my one suggestion: Create a branding message that doesn't mention banks.

Focus on what you believe CUs can do for consumers. Don't talk about the "difference" (which is simply positioning against banks) and don't use the word "member". Amex talks about how "membership has its privileges" -- are we talking about the same thing here? No. While there are certainly people who do care about being a "CU member", the branding campaign needs to figure out who it's targeting. And I would argue it's the people who are currently NOT a CU member, and may care less about "membership" and more about getting better financial products and services.

5) Mike Templeton @ Oct 06, 2008
http://www.paymentindustryinsider.com

I'm glad to see this analogy make its way from our breakfast discussion into a blog post. It was too spot-on to go unheard.

Originally I was on the side of creating a national branding campaign, but coming out of the Partnership Symposium, I realize how futile those efforts would be. As others have mentioned above, it's really about creating a branding campaign around each individual credit union in every community, and telling your prospective customers why they should choose you. Not why you are different. Not why they should pick you over a bank. Individual credit unions should be outlining who they are and why they are a fit.

Although we're all in this together, it will be hard for consumers outside this movement to form an affinity for credit unions at large. They CAN, however, relate to an individual institution vying for their business.

6) Tim McAlpine @ Oct 06, 2008

@Mike - our discussion at the Indianapolis Airport definitely solidified some things in my head as well. And I would be remiss if I didn't give you credit for the "scratchier towels" line!

7) Clint Williams @ Oct 07, 2008

@Ron - I like the don't mention banks. Emphasize our strengths without opening up a can of "not us". Banks do THIS BAD THING #1 - but not us. Banks do THAT BAD THING #2 - not us. It just doesn't leave a positive feeling.

I worked at an ad agency and had a fast-food client. Their marketing POV: You can 'brand' us all you want - but you've got to show a product and price point. NO MATTER WHAT - a burger better be in the ad.

No matter what - not everyone wants a burger. But everyone wants a place - that they WANT to go to. Same with a 'financial institution' (which makes the Bank/CU separation even harder).

Branding should incorporate that - and a national brand should do the same. Give them a reason to want to come to us - not because our product is 'better' our prices 'lower' - come to us because you can honestly - really - trust us.

8) Denise Wymore @ Oct 07, 2008
http://www.denisewymore.com

@Tim - as always, great post with fun analogy.

I think that a national brand campaign has already been launched. Credit unions are benefiting greatly from the failed banks (WaMu failure in Seattle is doing wonders for helping us define the difference http://blog.seattlepi.nwsource.com/thebigblog/archives/149716.asp

Now is the time for all credit unions to review their fees, their policies, their lending practices (courtesy pay comes to mind) and make sure that we don't even sort of SMACK of greed or enabling families to get in over their heads financially.

Those were the credit union values (promoting thrift and providing loans for provident and productive purposes only) and those need to guide us again.

9) Tim McAlpine @ Oct 07, 2008

@Everybody above. Great discussion and ideas. I agree that the comparison thing is hard and can have a negative effect. To Denise's point, the third-party endorsements going on right now are awesome and do more than any paid advertising could ever do.

Jeffry, on The Financial Brand blog had a great summary of recent headlines. http://thefinancialbrand.com/2008/10/06/the-media-loves-cus/

If CUs were to pool some money for a media buy, reprinting these headlines surrounded by white space and tagged by America's Credit Unions (or something like that) would make a great campaign.

10) Ron Shevlin @ Oct 07, 2008
http://marketingroi.wordpress.com

@Denise: Community banks and smaller, regional banks are benefiting from the big bank meltdown, as well as CUs. The increase in business is not a sign of -- nor the result of -- successful branding efforts.

11) Jim Jerving @ Oct 07, 2008
http://www.nacuso.org

Tim, great ideas. Thanks for your mention of my blog in your posts worth reading. An interesting analogy. During the great Depression credit unions did just fine--members paid back their loans and working people proved to be good credit risks. Now is the time to market the fact that we are stable, secure financial institutions that are to be trusted. We stayed out of the subprime mess because we cared about our members instead of the fast buck. Keep up the your good work and the fine quality of your writing!

12) ryan @ Oct 08, 2008
http://www.thecreditunionblog.com

Tim - Not all credit unions are built around the same model, so you're right, creating a national campaign will be difficult. State campaigns on the other hand might be doable. You could take that even further and do county campaigns.

One thing that I have witnessed in the seven short months that I've been employeed by a CU is that credit unions as a whole have a hard time telling "the story" and educating the public. For example, not once have I ever seen a CU run an ad stating who can join and I think this is a problem. You can do all the branding advertising in the world, but if 90% of the audience that sees the message thinks, "that's great, but I can't join" are you really doing yourself justice?

Ryan

13) Tim McAlpine @ Oct 08, 2008

@Ryan - excellent point. There is a huge perception that you have to be associated with a union to be a credit union member. Simply dispelling this myth is hard enough let alone proving CUs are better/different than banks.

14) Denise Wymore @ Oct 09, 2008
http://www.denisewymore.com

I'm in San Diego right now and get the San Diego Union Tribune delivered to my room each morning (thanks Hyatt). There was a pullout section in the paper this week highlighting local credit unions. The big ones all participated and wrote an "article" that was really more of an advertisement.

Sadly, all but one credit union really gave me a reason to care. North Island. They have a differentiator. They aren't just saying they are going green, they are living it. Giving away a hybrid car each month to promote awareness. Their new corporate headquarters from the ground up will be an LEED (Leadership in Energy and Environmental Design) certified construction. They even mention waterless urinals in the restrooms (seriously - that kind of scares me) but anyway, my point being - we need to differentiate ourselves from EACH OTHER! The other credit unions talked about being federally insured, they have checking accounts with bill pay and 24 hour ATM access..blah blah blah.....

It isn't enough to say "anyone who lives, works or worships and Orange, San Diego, and Riverside County can join." Who cares? Give me a reason to care.

15) Morriss Partee @ Oct 10, 2008
http://everythingcu.wordpress.com

@Jim Not only did existing CUs survive the Depression; 1934 was the year that hundreds of CUs were founded across the nation. This is due to the passage of the 1934 Federal Credit Union Act, the first national law that enabled CUs to be founded across the entire country. Up until then, it was up to state bankers to create enabling legislation, and naturally they threw up as many road blocks as they possibly could. CUs only existed in about a dozen states before 1934. http://en.wikipedia.org/wiki/Federal_Credit_Union_Act

---

Add a comment

*Name:
*E-mail:	(Will not display with comments)
Website:
Comments:
	Enter text shown in the image below:

BLOG SEARCH

BLOG CATEGORIES

30 Things (24)
A Day In The Life! (56)
Announcements (27)
Awards (7)
BarCampBank (15)
Big Evil Banks (17)
Blogging (22)
Blogs To Read (7)
Board of Directors (2)
Book Reviews (2)
Branding (47)
Challenge Marketing (19)
Collaboration (2)
Community (4)
Conferences (46)
Co-op Advertising (2)
CU Branding 101 (11)
CU Innovators (19)
CU Movement (15)
Cuckoo Campaigns (6)
CUES Podcast (4)
Currency Work (21)
Demographics (3)
Economy (1)
Endorsements (2)
Guest Posts (10)
I Heart CUs (33)
In The News (8)
Innovations (10)
Marketing (80)
Member Acquisition (1)
Member Service (16)
Musings (4)
Naming (3)
New Competitors (2)
Off Topic (3)
Opinion Polls (6)
P2P Lending (4)
Podcasts (26)
Positioning (8)
Press Coverage (2)
Product Dev (10)
Productivity (2)
Public Relations (8)
Ranting (5)
Scary Big Ideas (4)
Segmentation (2)
Service Not Enough (3)
Shout Out! (25)
Small CUs (5)
Social Economy (6)
Social Media (137)
Speaking (40)
Technology (20)
The Truly Weird (4)
Tips: Bad Practices (2)
Tips: Good Practices (3)
User-Generated (31)
Viral Marketing (6)
Web 2.0 (154)
Wet Blanket (1)
Young & Free (78)
Youth Marketing (83)
YouTube Videos (76)

ARCHIVES

August 2010 (3)
July 2010 (2)
June 2010 (2)
May 2010 (2)
April 2010 (3)
March 2010 (2)
February 2010 (7)
January 2010 (5)
December 2009 (5)
November 2009 (6)
October 2009 (7)
September 2009 (27)
August 2009 (5)
July 2009 (3)
June 2009 (3)
May 2009 (6)
April 2009 (8)
March 2009 (6)
February 2009 (7)
January 2009 (6)
December 2008 (11)
November 2008 (17)
October 2008 (11)
September 2008 (25)
August 2008 (20)
July 2008 (18)
June 2008 (18)
May 2008 (18)
April 2008 (21)
March 2008 (21)
February 2008 (14)
January 2008 (11)
December 2007 (7)
November 2007 (6)
October 2007 (6)
September 2007 (7)
August 2007 (9)
July 2007 (12)
June 2007 (11)
May 2007 (7)
April 2007 (3)
March 2007 (3)
January 2007 (1)
December 2006 (3)

OUR WRITERS

Nala Henkel (38)
Tim McAlpine (354)
Colleen Pepper (1)
CU Skeptic (1)

RECENT POSTS

August 31, 2010
Want to attend How Magazine's Mind Your Own Business Conference? I've got a code for you!

August 20, 2010
Lack of young blood runs deeper than membership

August 8, 2010
Young, Free and Super-charged

July 28, 2010
There actually IS meat on bacon!

July 19, 2010
Co-op Vegas?
(2 Comments)