Reality Check for One Community

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The "Privacy Week" activities that U of C FCU will introduce this week are just one part of a larger effort to position the credit union as an unbiased source of information and advice.

As reported Sept. 1, Privacy Week will include presentations by the local district attorney's office and a national consumer advocate, as well as an opportunity for members to bring sensitive documents for professional shredding.

U of C FCU Senior VP Rich Jones said the effort is in keeping with the credit union's goal of differentiating itself in a financial market that he summed up as "different name, same pitch."

To that end, U of C's initiatives have included an early installment of Reality Check, a page on U of C FCU's website that, in addition to information on car buying and financing, also included information about protecting against the deadly West Nile Virus, which has killed more people in Colorado than in any other state of the union, Jones noted.

"Some of the financial-related information is static, in that it's there all the time, but we also have a 'living' part of the site that is updated regularly with 'breaking news' on a variety of topics," he explained. "West Nile Virus is huge out here. It doesn't have anything to do with financing, but it's something our members need to know about."

Privacy Week has a much more obvious connection to what the credit union is all about, but it's all part of the same basic plan for becoming a go-to resource for the community at large.

"We had a seminar on privacy on campus earlier that featured Remar Sutton, a national consumer advocate who has worked with Ralph Nader, and that went over very well. We can seat 100 people, and we filled every seat and had people on a waiting list for that," Jones commented. "We also tied that to a car-buying seminar because there are some privacy issues there, too. (Sutton) explained what a dealer already knows about you when you drive on the lot. He's got your credit report, and he knows if you've bought from them before or from the same manufacturer. If you call or go to the website, some of them share that information with AOL, for example, and they'll know your buying preferences. You need to know what they already know about you."

The whole consumer advocacy effort that U of C FCU is undertaking has been orchestrated under a partnership with Sutton, who touts an education-based business strategy.

"We are a SEG-based credit union that would like to be seen as a community- based credit union," Jones said, noting that the CU won't convert to a community charter so long as it means giving up its SEGs, in particular, it's core sponsor University of Colorado. "The whole philosophy is that if the member can trust you to provide unbiased, unfettered information, then they will realize that the credit union and its products are trustworthy, too. If we help our members get the information they need to make good choices, that's going to help us a lot."

To that end, the credit union has converted its newsletter from a product marketing piece to an information piece that includes some advertising from the credit union-and all product promotions are treated as that, advertising, with the "editorial content" being dominated by consumer advocacy and community issues, such as the importance of bicycle helmets for kids, for example.

Going Out On The Edge

"And we went clear out on the edge with this, in our effort to provide unbiased, unfettered information," Jones related. "On the back of all our newsletters, we now include our rate information as well as those of our competitors, and we're not always the best rate. Our members need to know that we'll be honest, even if we aren't the cheapest."

If the premise reminds you of the Progressive insurance commercials that urged people to call in and get Progressive's insurance rates and the rates of four of its competitors, it should. But there is a difference.

"When Progressive did it, they looked at it as a marketing strategy. The whole point was to generate more phone calls because once you get someone on the phone to hear those rates, you are halfway to the decision you want them to make," Jones explained. "But for us, it has to be a business strategy. Our CEO has really modeled this. He took a call from a member who was calling to tell him about a deal he'd gotten on a loan and wanted to know if the credit union could beat it and if it was or wasn't a good deal. He listened to the member and then said, 'that looks to me to be a really good deal, you probably ought to go ahead with it.' Sure, maybe we don't get that car loan, but that member is going to look very closely at us the next time he's buying a car. Our members will come to use us as a benchmark, they'll rely on us to help them make a good decision."

The philosophy depends on the idea that when someone does you a good turn even when it doesn't end up in business for the person who helped you out, you look for a way to do business with that person in the future. "That's human nature," Jones added.

But how do you measure a program based on human nature and goodwill?

"We launched a 2nd Chance Auto Loan program using the Reality Check as the link. With all the 0% financing and rebate offers out there on auto loans, a lot of our members were being lured into the dealership only to discover that for one reason or another, they weren't eligible for the special deal-but by that time, they were too attached to the car to give it up, so they went with a different loan through the dealership, and a lot of them ended up in some pretty bad deals," Jones said. "We offered to refinance just the remainder of the loan, and we found we could save most of our members an average of $1,400. All the marketing was done through the Reality Check program, so when people started asking about the 2nd Chance Auto Loan program, we could get a sense of how many people were going to the website."

And of course, if the upcoming seminars related to the Privacy Week event sell out, that will be another indication of success.

U of C FCU is getting ready to launch Reality Bytes, a Reality Check program aimed at teens and young adults later this month.

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