Reader Question:
We are converting to a community charter, and we're on a tight budget. Is there anything we can do to make our two existing branches stand out in the community? Are there any changes, either internally or externally, that we should make now to have a broader field of membership?
John Hyche, Director of Consulting Services,
KDA Holdings Inc, Atlanta
The answer is "it depends." Here are some items to keep in the forefront of your thinking as you progress with your community charter. First, the community charter puts you in a different ballgame. Many traditional credit unions that convert to a community charter don't really consider the changed nature of member development.
They are used to members coming to them based on close relationships with the sponsor. This has allowed them to choose second tier locations for their branches and still succeed. From an external perspective, do anything you can to make sure that the community is aware of the credit union and can get to it easily. Obviously signage and lighting are two important factors.
Accessibility and convenience are also important factors. On a tight budget you'll not have the ability to relocate the branch if it's difficult to reach.
However, you can control the availability and "up time" of the phone center, website, ATMs and branch.
Twenty-four-seven is the expectation of most of today's consumers. Make sure they can see you, even when you're closed, and know the variety of ways to reach you.
Internally the philosophy is the same. Don't let new community members walk through your facility without seeing strong evidence of the entire range of products and services you offer. On top of that, the facility must look clean, and professional. Beyond your facility, don't forget the human factor.
By having personable, knowledgeable, helpful employees you can extend the credit union advantage to the community and become a formidable competitor.
Tom Lombardo, National Sales Manager,
HBE Financial Facilities, St. Louis
One important consideration is the credit union's name. If the existing name is too limiting because it is tied to a specific select employee group, the credit union may want to consider a new name that can be marketed to a broader community membership base.
For example, in 2000, Dallas Teachers Credit Union obtained a community charter to begin aggressively expanding its field of membership, largely in response to growing competition in the local market.
Despite the expanded field of membership, member volume was not significantly growing, and it was apparent that the Dallas Teachers Credit Union name was a major obstacle to future growth on-educators mistakenly assumed that only teachers could be members.
The credit union adopted a new name-Credit Union of Texas-supported by an aggressive marketing and communications program that resulted in substantial membership growth.
In addition to attracting new members, credit unions should not overlook growth opportunities involving existing members. Increasing the number of accounts per member-building "wallet share"-through aggressive relational pricing and marketing activities should be part of any community charter strategy.
Finally, aggressive merchandising within the branch with retail displays, video messaging and promotional materials can be effective in not only building incremental revenues but also in helping to establish a strong brand identity for the CU as it seeks to grow its membership base.
Externally, enhancements to such physical elements as credit union signage, facility color scheme and logo display can be beneficial in building awareness and brand identity.
Jim Caliendo, EVP-COO
PWCampbell, Pittsburgh
Carefully evaluating, and then updating your two facilities with a well-planned merchandising program may be the answer for you. As you make the conversion to a community charter, it is the perfect opportunity to better understand the credit union's long-and short-term strategic retail goals.
What products are critical to your bottom line and why? What are your sales strengths and weaknesses? How strong is your sales staff? You then need to evaluate your current merchandising program based on an interior and exterior facility review. Here are some of the considerations:
* Is your image consistent?
* Is the exterior signage consistent and easy to read?
* How is your lobby maintained?
* Does your point-of- sale information build awareness of your products?
* Are your merchandising and promotional messages easy to see, clear and attract members' attention?
* Is your merchandising plan monitored and updated on an ongoing basis?
* Are your sales representatives adequately trained on how to sell your services?
Recently PWCampbell completed a state-of-the-art retail financial facility for Cardinal Community Credit Union (formerly Mentor Schools Credit Union) in Mentor, Ohio.
This community-chartered credit union's retail financial facility was designed with many amenities including a history wall, an integrated merchandising plan, back-lit signage, strategically placed bulkheads and a tile floor to guide members through the facility.
The way that your credit union updates and maintains your two facilities will help you define your 'brand' identity and support your marketing efforts. This can be managed over time, with a minimal budget.
Remember, in order to be successful, your brand identity and image must be consistent.
Kevin Blair, President,
NewGround, Inc., St. Louis
To begin, no one should even consider converting charter or expanding FOM without a clear understanding of all the costs associated with making the change. Analysis as to the true financial impact needs to be clearly understood, and necessary funds to complete the transformation need to be allocated. The objective should not be how to get around spending the funds to properly implement the new strategy, rather you should be focused on maximizing the value of your investment. In other words, find the money to do it right.
With that being said, there are three areas that need to be addressed to leverage a new strategic direction. These are your Brand, Place and Culture.
Once a credit union changes from SEG based to community their brand position needs to be adjusted. The three specific areas that absolutely need to be addressed are name, logo and brand identity.
Today, a name change is not always perceived as a positive by members, however in many instances a credit union's name may be one of the largest obstacles to success. Make sure your name communicates your brand and vision of the future. Obviously if a name change is required, then logo design will also occur. Brand identity includes written communications, collateral and marketing materials. Make sure all these elements are in alignment with the new brand strategy.
Place is next. Within existing locations the merchandising and marketing communication systems must change. After all, what benefit is there to simply changing your name without communicating the message to not only existing members, but to new potential members as well. One of our clients produced a high quality CD that communicated their new brand, and then distributed this CD to all members. A rough budget to implement a merchandising program for a typical branch office is $10,000-20,000, depending on graphic and fixture selection.
Finally, there is Culture. A commitment to convert to a community charter should be accompanied by a commitment to train your employees how to leverage the new strategic direction.
Training is not a single, one-time, event. To properly leverage the new strategy, it is recommended that regular training sessions need to take place for 12-18 months.
These sessions are critical to reinforce the strategy and to make adjustments to overcome any obstacles.
John Nicola, SVP-Sales,
International Banking Technologies
Centennial, Colo.
A well-planned, coordinated effort to take advantage of the excitement created by the charter conversion can be done within a slim budget. Unique activities such as the credit union's senior managers cleaning members' car windows as they are using the drive-thru lanes is an easy way to break the ice with the members to tell them about the conversion.
This also creates interest from those people are driving nearby as they want to find out what is creating the excitement at the branch.
The branch employees could visit and discuss the expansion opportunity to their current SEGs in the area to announce the conversion.
Also, they could visit some of the larger employers whose employees have not been served by the credit union in the past to present their employees with the credit union's products and services.
Temporary banners placed on the exterior of the branch will also catch the attention of potential members as they drive past the branch.
The credit union could host an open house after typical branching hours to make it a special event. A barbecue or some other outdoor activity could be held-again drawing attention to the branch during the event-especially if the event is tied into charity event for the community. Inviting the local press to attend these activities will also help increase the media attention given to the credit union during this exciting time.
Finally, the credit union should prepare the branch staff well in advance of the external announcement to the community in order to take full advantage of the charter conversion ach employee who has member contact should receive training to enhance their sales and relationship skills.
The credit union should not assume that their employees will know how to sell the advantages of their new charter to prospective members simply because they have been in their positions for several years.
Ralph La Macchia, La Macchia Group,
Milwaukee, Wis.
Studies indicate that lighter colored branches perform better than darker colored ones. Several low cost alternatives exist for changing the exterior of your building, i.e., paints, epoxies or stains for brick and block.
Roof size, height, color and material can also change the appearance of the building.
Sometimes, adding new or additional windows can be a reasonable alternative. Think about the possibility of lighting the face of the building at night. Signage and landscaping also have an impact.
Has your marketing been passive at best? Are you planning to change that policy? When inside the facility, merchandising displays and television monitors with messages can play a key role in educating, and creating a pleasing and memorable experience for your customers-members.
Take a hard look around you. What do you see? The entire feel of the space can be altered by simply installing rope lighting under the teller counter and-or adding new flooring and wall coverings. The ceiling is another area that can be looked at to freshen up the space.
What does your member service area look and feel like? Do you see metal desks from the 40s or orange bucket chairs from the 70s?
Sometimes, just modernizing the work spaces, at least the public areas, can go a long way while also boosting productivity.
Oftentimes, these changes fuel the attire chosen by the employees. The best advice is to first, develop a budget, and then hire someone you trust who has extensive experience with credit unions. Share with them your goals and have them show you what they can do. If it all fits, you win!
Gene Lock, Executive Vice President
Design Build Concepts, Atlanta
Converting to a community charter provides a unique opportunity to generate excitement and awareness about your credit union.
Conversions often include the development of a new corporate image, including a name change and a new logo. As you define your new image, be sure to think about how your facilities affect the perception of your credit union in the community.
The exterior of your existing branches gives potential members a distinctive first impression of your organization. Be sure to thoroughly assess the appearance of your buildings and make sure they are in good repair.
In addition to proper maintenance, one of the most important elements to the exterior of your facility is signage.
Signage draws members to you, and new pylon signs featuring your new logo can have a substantial effect on the overall appearance of your branches. In addition, by sprucing up the ATMs with your logo and splashes of color, you will enhance the effectiveness of any new signage you install.
Lastly, a small investment in landscaping can dramatically improve the exterior appearance of your facilities.
Inside the building, your lobby presents the biggest opportunity for you to make the most impact valuate the condition of the interior finishes including wall coverings, paint and carpeting. Replacing worn items will help to create an inviting and pleasing atmosphere for greeting new members.
Accessories such as merchandising posters and displays are a cost-effective way to complement your interior design scheme while also promoting your products and services to your members. Also, since the teller line is the focal point of any lobby, investing in a new teller line can completely change the look and feel of your branch.
In addition to updating your facilities, this is also a good time to increase your marketing and public relations activities.
Hold a Grand Opening celebration to introduce your newly improved credit union to the public or distribute a press release to your local media about all of the changes happening at your credit union.
With these combined efforts, you will be recognized as a leading financial institution within your newly expanded target market.
