MADISON, Wis.-With marketing to new members likely high on CUs' 2010 strategic planning lists, CUNA Mutual Group suggests that appealing to existing members first may be the best way to grow the membership base.
Dave Colby, CUNA Mutual Group chief economist, discussed the significant opportunity to strengthen the credit union's standing with existing members to grow share of wallet and also spur growth from within the community. "I am telling credit unions to focus on existing members, whether that's in lending by prequalifying people, doing workouts, or having a young borrowers strategy," Colby said. "The average yield on loans is 6.35% versus investments at 2.81%, and credit unions need that additional 350 basis points."
On the savings side, Colby emphasized promoting "thrift as a debt alternative. Take advantage of the savings revolution and show members how much having a rainy day fund can save them from a financial emergency."
Not only do the approaches improve the CU's income statement, they create a group of satisfied members who market the credit union to their friends. "You get more bang for the buck, and every buck is precious today," said Colby.
Colby also reminded that credit unions should strictly adhere to their ALM strategies and not give into the temptation to go longer with investments and chase rate. A community relations strategy, Colby advised, should also be in place that leverages the successes the credit union has turning around members' financial lives. "This is the time to promote a sense of community that builds the credit union's brand image. Celebrate member successes and make heroes out of employees who have made a difference for members."
For info: www.cunamutual.com
