Once upon a time, credit union marketers wrote the monthly newsletter, organized the annual meeting, worked with a couple local charities and coordinated the occasional financial education promotion. Times were simpler then…
Today, credit union marketers must be masters of design, research, data analysis, product development, advertising media, digital channels, public relations and social media content.
While the dynamics of marketing credit unions has changed drastically, the mindset among many CU managers has not; many myths persist. How can credit union marketers get the results CEOs expect — and the respect marketers crave — when faced with outmoded beliefs?
A white paper from CUNA’s Marketing and Business Development Council looks at the changing dynamics in credit union marketing, and how CMOs need to respond. In the report, CUNA outlines ten principles underpinning marketing success. The ten points are all based on common misconceptions, revealed in a series of interviews with the credit union industry’s top marketing professionals.
What CUNA found is that a new credit union marketer is emerging — one who builds internal bridges, manages risk, who understands how data can drive decisions, who can demonstrate results for marketing initiatives. But in order for this 21st century marketer to flourish, many myths must first be put to rest.
The complete CUNA report, “Marketing is Easy and Other Myths: Strategies to Demystify 10 Misunderstandings That Plague Credit Union Marketing Professionals,” is available online in the white paper section of www.cunacouncils.org. Here are five of them.
Myth #1: Marketing on rates is the only way to compete
Reality: Consumers are not logical. The most successful companies use their brands to create real value and connection. According to Psychology Today, while most people believe that the choices they make are a result of careful analysis, in reality, emotions greatly influence and can even determine decisions. In fact, in consumer behavior studies, neuro-imagery can show that when evaluating brands, consumers use emotions, personal feelings, and experiences, rather than information like features and facts.
“Marketing on rate alone is a quick track to not reaching your marketing’s full potential,” says Jason DuPlant of Neches Federal Credit Union ($357 million in assets). “For any offer or rate, a prospective member can probably find 1,000 more just like it — or better — through other delivery channels.”
Key Takeaway: The emotional argument trumps the rational one. Rate-focused offers are rational. Appeal to people’s emotions first, then offer them logical justifications for their decisions.
Myth #2: Marketing and business development are the same
Reality: Marketing and business development require different skills.While marketing and business development are often used as synonyms in credit unions, as they both contribute to overall growth, the two functions are actually quite different. Marketing involves building a strategic plan, defining messages, crafting external communications and managing the visual brand. Business developers should have a strong focus on developing partnerships and strategic relationships.
Key Takeaway: Marketing is the management of processes and things. Business development is the management of relationships (i.e., sales).
Myth #3: Great marketing is always expensive
Reality: Creativity and uniqueness can score big wins no matter the budget. According to Jay Levinson, guerilla marketing is a term borrowed from military vocabulary that indicates a marketing strategy alternative to the traditional in order to achieve great results with minor investment. Since the strategy is direct, provocative, and surprising, it reaches the consumer in a way in which the typical defenses are lowered, providing maximum impact. Typically, these types of campaigns are directed towards small communities and micro-target to create high emotional impact.
Key Takeaway: Stop thinking about marketing along the same old traditional lines and typical media channels. Don’t do something just because “that’s what we’ve always done.” Big rewards come to those who take bold risks. That’s what guerilla marketing is all about.
Myth #4: The CFO is the arch-enemy of marketing
Reality: Marketers and CFOs can work together to achieve common goals. The relationship between marketing and finance has been notoriously contentious, and one rife with misunderstandings. CFOs are stewards of the budget and bottom line, while marketers are responsible for achieving some modicum of growth. Although these two camps could forge a symbiotic relationship, marketers and CFOs often feel they are at odds with one another.
Many times a breakdown in communication is to blame. A study by CFO.com showed that marketers believed they were sharing more information than CFOs claimed to be actually receiving. Conversely, most CFOs believe that marketing does not have any real impact on profitability. Indeed 40% of CFOs don’t even think their marketing departments make net revenue a priority.
Key Takeaway: Marketers need to earn the respect of CFOs. And CFOs need to make an effort to learn more about marketing’s role and potential while approaching the subject with objectivity. A healthy relationship starts with dialogue and a mutual understanding.
Myth #5: Other credit unions are our biggest competitors
Reality: Credit unions can still work together to gain market-share. A new term has crept up in credit unions in recent years called “coopetition,” a term that encompasses how credit unions can still exhibit the values of a cooperative while also competing for market share with other credit unions.
As more credit unions expand their charters, fields of membership have and will continue to overlap. While small credit unions fear being merger bait, and increasing competition among all credit unions hinders collaboration, cooperation is still embedded in the DNA of the credit union movement.
As Debra Trautman of the Maine Credit Union League puts it, “a credit union’s unique brand is important, and doesn’t have to be sacrificed to work cooperatively with other credit unions.”
Key Takeaway: Banks are the enemy, credit unions are your friends.