How Your CU Can Take Firm Control And Grow This Year

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Credit unions everywhere are scrambling to manage a huge increase in deposits. The key to increasing loan-to-share ratio is to think like a brand and act like a retailer. Don't be scared of the word "retail." It just means providing the leadership to "sell" your products and services by promoting them to members and potential members most likely to "buy."

Here's what you can and should do.


A marketing-driven CU is focused on meeting the needs of members, and prospective members. It takes strong leadership from senior management and the board to keep the credit union focused on member needs. Being marketing driven brings all your CU's "core values" together and helps everyone focus on the same mission. That's key to increasing your ROA and net revenues. Then you must clearly communicate your core values back to your FOM consistently.

If you work to understand the needs of your FOM, it may lead you in bold new directions. You might need a name change to encompass your entire FOM. It may be prudent to change your charter. Consideration of risk-based lending processes might also be analyzed. In short, you need to back up and look at your CU through members' eyes.

Tools Needed

Successful strategies require current, correct information about your FOM. Profitability and householding analysis capabilities, consistent surveys, and the use of an MCIF are instrumental in developing strategies based on the facts, not on the gut feel of management.

Profitability analysis should be constant-meaning you should always know how profitable your products and services are and how they are being altered by market conditions. And your employees need to understand this, too. This way they know what products to offer to members.

Consistently take the pulse of membership through surveys. Use profitability analysis and MCIF database information to monitor the constant shifts in your membership, and how they are consuming your services. That's how you keep pace with a rapidly changing financial retail environment. Once you have a clear picture of your membership you can begin effective, fact-based strategic planning.

Target marketing connects your products and services with members who need them. Identifying your market segments, and tracking your results against them, will build your efficiency. Your MCIF can directly track your ROI on all target- marketing processes.

The smaller your credit union the more critical these tools are. Managing any business without good information is like swimming underwater with your eyes closed. Get the best, most timely information you can find, then use it to make strategic decisions. Member surveys are not expensive or difficult. Let members know you welcome feedback, and you make changes based on member ideas. Use the phone, web, and your branches to make it easy to contact you.

Marketing Personnel Are Key!

Would your credit union hire an inexperienced, uneducated CFO? Of course not, and your top marketing position should also have the same commitment from management. Consider building "incentive-driven" contracts for your marketing positions based on profitable growth and achievement of other marketing goals. If your CU doesn't have a highly experienced marketing person capable of driving growth strategies, then consider a consultant to build the plan for your marketing team. Don't neglect a PR strategy, business development and FOM partnerships when setting marketing department goals and objectives.


Marketing is how you reach out to your FOM. Members can only act on the information you give them. Effectively communicating with your FOM creates a powerful competitive edge! Smart marketing makes your whole organization more effective and profitable, reduces pricing pressures, increases market share, and makes it easier to recruit more qualified employees. Perception is everything in an advertising saturated society.

To be a successful marketer, you must build and maintain positive brand awareness. Then layer your sales messages over your respected brand. Remember these two basic rules of life and marketing: 1) You don't get unless you ask, and 2)People don't know unless you tell them.

Never believe your members know all about your CU. They're busy, and they only care about messages that relate to their own lifestyle needs.

Marketing is not just putting out brochures, publishing a newsletter, running a few print ads and having the occasional "campaign." Your members are bombarded with financial messages in every media. As a credit union, you have the ability to share your core values with your FOM, and let them become part of the value system. A member who truly feels a sense of belonging is a member who will be interested in more from you.

Too often credit unions run a campaign for a product, let's say an auto loan, without a strategy to capture other assets from the target member household afterwards or during this process.

Remember this basic formula: product/service offerings, plus packaging of multiple services must drive member behavior to where you want them to go. Don't market one product at a time, and fail to understand what other needs you can meet for that auto loan target/member. This involves specific marketing strategies and the ability to change your marketing messaging quickly in response to market conditions.

Make sure all of your communications correctly position your brand, and reinforce core values. Syndicated advertising materials sold to you from advertising companies that target CUs that don't match your brand cost you far more long-term than they return in the short-term. Spend a little money to have your materials created and produced to support your brand-not water it down!


Being marketing driven also means having the appropriate internal culture so you can cross-sell products and services to your FOM. If you successfully create a "sales-culture" your employees will understand that branches are retail outlets where members make financial purchasing decisions. Development of a true sales culture can be very difficult. Help your employees understand that educating members about loans, auto buying services, etc., is a service to members.


Will Rogers once said, "You can be on the right track and still be run over!" And that was years before we entered this fast-paced e-environment. If an e-strategy isn't currently part of your CU's overall strategy you are going to get run over-by your competition.

Having a website and an Internet banking product is a start, but by no means is it a comprehensive e-strategy. You must know what your members want directly- mainly through consistent surveys and business development (SEG) contacts. Do not base your e-strategy on what a particular executive or board believe it to be. Design it based on proactive communication with your membership. How are their needs changing and what will they be three to five years from now? If you aren't trying to answer these questions- watch out for that locomotive!


Your CU's leadership needs to start forming, or at least strategically plan for, strategic alliances, and consider development of CUSOs.

A lot of people in our industry say there will be only two types of CU's in the future-very big CUs, and very small CUs. That means that CUs between $25 million in assets and $500 million in assets need to start forming partnerships now! I forecast that CUs between $100 and $400 million in assets will start to see the squeeze before 2005. Sitting back on your capital reserves and thinking that the "people helping people" formula will keep your CU above water may be the riskiest decision management can make today.


The trade groups and associations are great sources of education for your CU. But you should also task a person in your CU to seek out peer-like CU's in other states that have similar issues to share solutions. Visit and learn from their organizations. Most CU's would love to have out-of-state CU visitors who trade ideas and solutions.

Becoming a "marketing-driven" CU positions you to take control of your loan- to-share ratio profitably. Know your members. Communicate and protect your core values. Make informed decisions. That's leadership.

Paul J Lucas is a CU/CUSO marketing consultant having served CU's/CUSO's in 25 states, and three internationally. He can be reached at 703-802-1042 or

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