LAS VEGAS-The quality of proactive engagement is what drives revenue growth for credit unions, according to Bob Tramontano.
Tramontano, VP of financial industry marketing for NCR, told attendees of NACUSO's Annual Conference here credit unions should continue to invest in branches as well as online and mobile channels, because all three are important to making deep connections with members and potential members.
"For financial institutions the No. 1 priority is asset growth and quality, and the No. 2 priority is profitability improvement," he said. "Branches are transitioning from places where transactions are performed to places where sales take place. The average U.S. consumer owns eight banking products, while the average U.S. financial institution holds two of those. Credit unions should be focused on moving from two to eight."
Technology can be used to create a higher level of consistency across all interactions, Tramontano continued. He said the best technology seamlessly executes purpose, leaving the brand experience to stand out.
The Alignment Challenge
"Credit unions need to combine technology with staff/member interactions. Some members want self-service, while others walk in the door wanting interaction. The challenge is to align talent, physical space, processes and technology."
Among the emerging trends that will affect CUs and how they communicate with members in branches, Tramontano cited kiosks and teller cash recyclers, which he said help free credit union employees to engage with members.
"The branch environment becomes open, and the intimacy gap between credit unions and their members closes," he said, adding the next step is life event management. "Banking needs to become an engaging, personalized experience. Technology helps extend the reach of a financial institution, helping it manage impulse to action, stimulate want, facilitate discovery, provide validation and build relationships."
Including all channels, CUs engage with members 300 million times per day, or 209,683 times per minute. Tramontano said "disruptive changes" are in the air, because in 2012 children born in 1994 are turning 18. He pointed out these are the first adults who have lived their entire lives in the presence of online retailing.
As a result of this upbringing, this generation expects instant gratification, frequent rewards, and digitally empowered, socially networked, self-service channels. Further disruptions are possible, he said, thanks to emerging payment systems such as mobile person-to-person, "Which could put further pressure on revenue streams."
Mobile, Payments & Targets
Not only are more people carrying smart phones, Tramontano noted the displays are becoming larger, allowing users to do more. The future, he predicted, will combine mobile banking with mobile payment capability, plus targeted offers.
The two main competing mobile wallet options-"wallet on phone" versus "wallet in the cloud" bear close watching, he advised. "The consumer will choose, not us," he said. "HTML5 is coming, and it will open more advanced features to a broader set of phones."
With all this talk of mobile payment technology, it may come as a surprise to know cash is still important, Tramontano continued. He cited Walmart's latest endeavor, which allows consumers to order online, then pick up their merchandise at their local store and pay with paper money. "About 40% of Walmart's sales are still in cash," he said.
