Four Winning Plays for Connecting with Members

How can credit unions up their game in the contest for trust and become their members’ most valued financial partner? 

by Steve Danco, SVP, Direct to Consumer Experience, CUNA Mutual Group

Credit unions have long nurtured a deep trust with members. Historically, that trust has been difficult for even the most formidable opponent to duplicate. Difficult, yet not impossible.

In fact, research shows that the investments big banks have made in technology have leveled the playing field in the battle for the trust and loyalty of financial consumers. They have been able to change the game by delivering simple, easy experiences that meet the needs of today’s consumers.

Between 2020 and 2021, the share of consumers satisfied with their credit union fell almost two full percentage points, from 88.4% to 86.5%. At the same time, consumers satisfied with their digital and online banks rose two points, from 82.8% to 84.8%. In the race for satisfaction, credit unions and their competitors are neck-and-neck.

So, how can credit unions up their game and take an aggressive stance in the contest for trust and become their members’ most valued financial partner? In our work at CUNA Mutual Group, we see four distinct opportunities.

1. Digitizing to Honor Individuality
It’s no coincidence the shift in member satisfaction happened during a time of intense demand for digital engagement. Credit union members are like other financial consumers. They want simple, easy, digital, automated experiences that help them achieve their goals faster.

Digitization can take many forms, and it’s not all about migrating analog services into digital channels. Our team likes to say, “Digital first doesn’t mean digital only.”

Whether it’s streamlined loan origination, easy new member registration, automated communications or APIs to accelerate integration, the idea is to find ways to serve members in the channel of their choice and in a way that demonstrates deep respect for their individuality. Because they are having personalized, channel-agnostic experiences everywhere nowadays, members expect credit unions to identify, authenticate and serve them fast, right where they are.

2. Leveraging Data for Superior Service
Credit unions have been able to differentiate based on service as a core competency and have built their brand promises around this distinction. The thing is, we’re hard pressed to find a fintech or big bank that doesn’t promise the same thing. The reality is that “service” is everywhere – and consumers expect higher and higher levels to meet their expectations.

The democratization of data analytics makes it much easier, particularly for newcomers unhindered by legacy systems, to know what their customers need today and predict what they will need tomorrow.

The distinct advantage of the credit union industry can be found at the intersection of mission and data. Credit unions have an innate and authentic desire to serve, not to profit. The opportunity is to use data differently—ethically, transparently and in a way that builds trust while fitting into modern lifestyles.

3. Flexing with Member Preferences
There is no finish line to understanding how members want to engage. People change as they progress through different ages and life stages. Layer new technology, digital channels—and soon, the metaverse—on top of natural changes in a person’s life, and preferences become very fluid.

Credit unions must craft member-centric plans flexible enough to shift based on insights from feedback loops, continuous research and strategic empathy. Keeping a finger on the pulse of attitudes, preferences and behaviors means challenging what we think we  know about everything in  members’ financial lives.

Take the traditional car-buying journey for example. Whereas car buyers once visited their credit union first to secure financing, the vast majority now start with the car shopping experience. Financing follows sales in many cases. That simple evolution calls for a dramatic reimagining of the borrower journey. Credit union lenders must now redefine  their place in a world of online car marketplaces and embedded finance innovation. As Ronny Chapman, our SVP of Product Technology Solutions at CUNA Mutual Group says, “To win, credit unions need to get to the point of purchase.”

4. Accelerating DEI for a Financially Well World
People want to see themselves represented in the places they trust with their money and future, and they want to see the brands they trust be active in the community  --  a competitive advantage for credit unions. For many credit unions, that means focusing even more on building their diversity, equity and inclusion (DEI) competencies.

For most of us, DEI starts with awareness. Do we understand barriers to the traditional financial services system? Are we aware of our unconscious biases? Do we have and know our social justice position? As we build awareness, we are able to move to action to make a real difference for our teams, businesses, customers, and communities.

​There are numerous challenges facing credit unions today. The competition for member acquisition, retention, and optimization is intense, and trust is always in the balance. However, credit unions have distinct advantages; their place in the community remains a key differentiator, and their mission resonates strongly with consumers.

Achieving success looks different today than it has in the past. But with the right approach – simple experiences driven by data and built on customer knowledge – credit unions will be able to position themselves as the financial partner of choice for the future.  

CUNA Mutual Group (CMG) is DakCU’s System Partner and is the marketing name for CUNA Mutual Holding Company, a mutual insurance holding company, its subsidiaries and affiliates. Corporate headquarters are located in Madison, Wisconsin. CMG is a financially strong insurance and investment company. For generations, they have partnered with credit union leaders to protect and grow their businesses; and help people plan, protect and invest for their future. CMG offers commercial and personal insurance products; lending and payment security solutions; and retirement, investment, data and analytics, and marketing services. Please contact George McDonald, DakCU’s Chief Officer of Strategic Services for more information.