During the last couple of years, I have had hundreds of conversations with credit union CEOs, executive leaders, and credit union staff across the country. In an effort to get to know them and to understand their circumstances, I ask one simple question; “how’s business”? The answers I get almost universally reflect the same compelling business needs over and over again at large credit unions, mid-size credit unions and small credit unions. Let me give you some real life examples from just a few of those conversations.
First, Credit Union Branding in the local marketplace is lacking. Here are a few quotes from executives that may strike a chord:
“Our prospective members don’t know what we do”.
“Right now, we lose as many members as we gain and we don’t have the bandwidth to change it”.
Second, Credit Unions are dealing with direct sales and sales Culture challenges. Let me give you some examples:
“We use existing staff to help with cross selling and up selling but at the end of the day, it’s a real struggle to grow and stay ahead of the day to day challenges of running our credit union”.
“I can’t manage the sales effort in my credit union since I am on multiple boards”.
“My frustration is that my current staff does not think like I do”.
“My credit union struggles to find the resource that can be a great teller but can also prospect and sell products and services into the current membership”.
Third, Business Development is challenging at SEGs and targeted employers. Here are a few more comments from credit union executives:
“We struggle to schedule visits to our SEGs with our teams”.
“Because we are so busy staying ahead of the regulatory challenges, it’s difficult to find the time for our current staff to go visit a SEG”.
“Current budgets are constrained and prevent us from hiring more staff”.
The issues of branding, member growth, and loan volume remain critical for a majority of credit unions. Typically, all of the above challenges are managed and performed by extremely busy, overworked credit union staff that in many cases does not have adequate training or appropriate behavioral skill sets. Historically, credit unions have always been able to depend on membership for loan volume, however, the current and continuing economic cycle has changed membership buying habits and credit unions are being forced to consider new ways of driving branding and growth. The bad news is that this change is likely to continue for the next several years. Contributing to the unrelenting pressure within credit unions are many other issues including extreme regulatory pressures, increasing rates of non-affiliation across the country, an uptick in merger activity, consumer fear, lack of industry growth, and unity challenges. The cumulative effects are far reaching and impact CUSOs, Leagues/Association affiliation levels, credit union staffing levels, and even the financially strongest of our vendor partners. The end result is both a national and state market share that is contracting, not growing, in spite of the incredible opportunities to move market share from banks to credit unions.
Until credit unions drive a targeted effort at resolving these foundational challenges at the individual credit union level, large portions of the industry will remain at near zero growth rates. Subsequently, the issues many credit unions face today including at worst, the question of viability, will continue to push the industry in the wrong direction. Ultimately, the lack of industry growth will translate to the continuing loss of legislative battles and a dwindling strength in Government Affairs, both locally and at the national level.
Our league services solutions are designed to address these issues. Our solutions can inject the much needed specific sales/sales culture, business development skills, and marketing expertise into a credit union to help drive planned and targeted metrics related to branding as well as individual growth for individual credit unions.
WHY IS IT IMPORTANT?
The challenges credit unions face in the market place include:
- No state or national growth
- Increasing rates of credit union mergers
- Increasing rates of credit unions choosing non-affiliation with Leagues/Associations
- Zero or negative membership growth within many credit unions
- Increases in state and federal regulatory pressures
- Lack of sales culture in many credit unions
- Forced staff transitions in credit unions, CUSOs, Associations/Leagues and Vendor Partners
- CUSO’s business models in support of credit unions have been diminished
- State Associations/Leagues have lost relevance with member credit unions
- Legislative losses are trending up
- Fractured credit union system unity
When credit unions are able to improve branding and increase sales, the business of credit union growth, as defined by each credit union, can occur. When credit union growth occurs, our business challenges will change and evolve away from issues of contraction to issues of expansion.
If your credit union is able to grow from a regulatory perspective, has the will to grow, and has the operational capacity to grow, call us at 720-479-3342 to schedule a discussion and find out how we can help your credit union or your group of credit unions position for the future.