Why do consumers leave one financial institution for another? The answer to this question comes from understanding the concept of "push vs. pull" and the acceptance that "push" factors are exponentially more powerful. Regrettably, from a business development standpoint, people rarely consider changing financial institutions unless something substantial changes in their lives (e.g. marriage, relocation), or negative experiences PUSH them away. Conversely, regardless of how hard a CU may try to pull in new members, most prospects aren't likely to respond unless they are simultaneously being pushed away.
So the question is: how can credit unions find a way to target prospects that are currently being pushed and pull them into the credit union? An excellent starting point is to determine what tends to move prospective members into the "push zone," so these actions can be avoided at your credit union.
* Surprise/escalating fees or unfavorable policy changes. Any time there is a change in fee or policy, expect consumer disappointment.
* Indifferent attitudes. Unfortunately, members remember poor or indifferent service to a fault-it's a guaranteed push.
* Consistent errors. Consumers are tolerant about occasional errors, especially if addressed effectively. Yet, when errors become the norm, nothing PUSHES financial consumers to the limit more quickly.
* Poor correction of errors. Most of the time simply fixing an error isn't sufficient. Going one step further to address the "hassle factor" prevents the member from being pushed away.
* Limiting access. The best example of this is closing branches; suddenly a member's convenience has been lessened, which tends to push anyone's buttons.
* Reduced speed. As with convenience, speed is an important part of members' experience. Parking problems, slow or down ATMs, longer teller lines, slow response on requests, etc., will push them away.
Understanding the factors of push vs. pull can especially enhance member growth efforts. Keep a keen eye to avoid pushing out members, and vigorously pursue prospective members who are currently inside the push zone.
Neil Goldman is President of Member Research, a market research and consulting firm serving the Credit Union industry nationwide. For further information, call (310) 643-6753.
