MADISON, Wis.-With young consumers citing convenience as the primary reason they choose a financial institution, credit unions have work to do on both communications and lending fronts to get more youth in the door.
Of course, even that notion is old-fashioned, as the last thing many young people want to do is be required to visit their financial institution in person.
Ben Rogers, research director at the Filene Research Institute, pointing to a Filene study indicates that young adults choose their bank or credit union for convenience over products (see related story), said credit unions have to make the cultural shift away from being so product focused and get better at convenience.
Rogers said credit unions need strong web and mobile channels, and that the website has to conform to the "two-second rule. If the consumer can't do the next thing they want to do on your page, or figure out what they want to do, within two seconds you will lose them. If your site can't conform to that rule, you will have a tough time convincing young members you can be their PFI."
Credit unions too, have to be good, if not great, at branching, call centers, and ATMs. "It is hard to focus on just one channel and say you have convenience down," said Rogers. "Today, convenience means being great, or at least adequate, on all of those fronts."
Simplicity & Convenience
Part of being convenient is making it easy for young adults to become aware of the credit union, insisted Rogers, who said that's where effective marketing comes in-on the web, through social media, and via traditional mass media. "You have to be out there for people to find you and perceive you as being convenient."
It's not only access to the credit union that young adults see as defining convenience, today more youth tend to look at how simple it is to apply for and get a loan, said Rogers.
"Consumers in most cases tend to make the borrowing decision secondary to the purchasing decision, outside of the mortgage loan. That is not easy to hear because as rational human beings we all think that if the deal is better at the credit union the member will get the loan at the CU. Sure, some will, but not the majority. Outside of mortgages, most people think of loans as a convenience item."
To make lending products more convenient, credit unions, for example, can build a strong preapproval program connected with local auto dealerships that makes it simple to close the loan at the point of sale, added Rogers.
