Expert Warns Against Castle Syndrome When Rebranding

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FAIRFAX, Va.-Do credit unions know themselves?

According to Paul Lucas, a marketing and branding consultant for credit unions and CUSOs, the answer is no — at least not enough to know their brand.

"When credit unions decide to rebrand themselves, that is a mistake," he declared. "No. 1, when you are inside your castle you only see yourself inside your castle. The brand is the bridge across the moat."

The view across the bridge is quite different from inside the castle, Lucas continued. He said CUs need help pinpointing what their core values are, where they are going and what brand is going to take them there.

"A good brand today has a foot in the present and a foot in the future. Most credit union brands in the United States have a foot in the present and a foot in the past. Before credit unions rebrand, they need outside help deciding where they want to go."

Fast Or Slow?

In the case of rebranding branches after a merger, the choice of fast or slow execution depends on the "wherewithal of the credit union," Lucas said.

"Where does it stand financially? A billion-dollar credit union can do everything at once because it has the money. A smaller credit union might do a soft roll-out. It is different every time because it depends on several things."

In 1996, Norfolk Naval Air Station FCU in Virginia Beach, Fla. changed its name to Chartway FCU. Lucas said Chartway "changed everything in a week-signs, forms, everything. Not every credit union has that kind of cash, because that costs a lot of money. They threw thousands of dollars of forms into the trash."

At the other end of the spectrum is a small credit union in Pennsylvania with which Lucas recently consulted that acquired another CU. He said the acquiring credit union was in no financial position to waste anything or to throw anything away, and therefore will use every form it has before replacing them with new ones. "Rebranding can be done without throwing away all forms. The major things have to be changed: external and internal signage, marketing efforts," he said.

Why No Negative Feedback?

When FDIC FCU merged with National Science Foundation FCU to form The Partnership FCU in Fairfax, Va., it was a "good, clean merger," Lucas assessed. The reason it drew very little negative feedback from members?

"Communication is the key," he answered. "During a merger the credit union has to communicate to members very aggressively what it is doing and why. Every situation is a little bit unique, but tactically, communication is the most important thing."

The reason for the merger of FDIC FCU and NSF FCU was not credit unions that were failing, they wanted to merge together to form a partnership and in the future merge other government agency credit unions, he explained. It was "pretty simple" to come up with the name because it was a partnership, "but what made it successful was the boards agreed on everything and communication to members was up front about the reasons. Once we arrived at the name and the brand we let people know ahead of time. It was nine months in the works."

There are three basic steps CUs should take with branches acquired in a merger, Lucas advised: 1), change internal and external signage and marketing; 2) remove clutter and clean up the branch so the new brand can be featured and 3) have a promotional kickoff to get people involved. "Perhaps an open house or a radio remote, depending on the membership. For a SEG-based credit union, perhaps a loan special."

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