Three States, Three Approaches To CU Advertising

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Three states are pursuing three different strategies in promoting the credit union message and responding to attacks, ranging from humorous radio ads, offbeat TV spots and mandatory fee assessments to credit unions.

Here's a look at each:

Minnesota Laughs Through Clutter

In Minnesota, the Minnesota Network Advertising Program is voluntary, with the state's credit unions getting from the Minnesota Credit Union Network a suggested amount to contribute on annual invoice. MCUN President Kevin Chandler said that effort typically brings in about $200,000, but conceded it is becoming more difficult to raise funds as the number of credit unions shrinks.

Chandler acknowledged that $200,000 is not a significant level of money when it comes to buying media time. As an aside, he noted that as a former member of the state's legislature, one reason politicians run so many negative ads is that "going negative" cuts through the clutter. "I know you if you're running a positive message you have to hit people nine times to be effective. That's why in politics negative ads are so effective."

Chandler said another way to cut through the clutter is with humor, which is the approach taken in Minnesota. "We're almost always taking on the banks on some topics, but we use humor so it grabs attention," he said, before playing the radio ads for his audience. "You'll notice (the spots are) not only about encouraging people to join a credit union, but there's always an advocacy message in it designed to reach not just the general public, but our policymakers, too."

Chandler said the MCUN is currently prepared for a tax bill should it be dropped in the state legislature, and has already recorded one radio ad and has brochures ready to be printed. "I guess the bottom line is if you are limited in your ad budget, be focused, and keep it reinforced with collateral materials," said Chandler.

No Quickie Campaign

When it comes to advocacy on behalf of credit unions in the media, the country's eyes are on California where the California/Nevada league is three months into a two-year, $6-million media campaign.

"This is more than a quickie ad campaign. This is a forever, we hope, change in the way we do things in California," said league spokesperson Henry Kertman.

Kertman outlined for his audience the research conducted by California's credit unions, pointing out that research had shown most consumers don't know that credit unions and banks are different, and that non-members would side with banks by a 2-to-1 margin in a legislative battle.

"We found out that if only these nonmembers knew certain aspects about credit unions, we could move some of that 2-to-1 margin in our favor," he said. "For example, if they knew we serve the underserved, that would move things a tad. If they understand we are locally owned and profits stay in the community, that starts to bring people to our side. And, in addition, if they just understand that having credit unions in the market helps to keep bank rates competitive for everyone, that makes a difference."

Kertman stressed that the California/Nevada advertising is not aimed at building membership, but to build awareness of what credit unions do, especially among nonmembers and policymakers. "This is pricey. But if we did it for one or two years we might as well just throw our money away," said Kertman. "In California, a million bucks buys eight weeks of radio in Los Angeles. TV in most markets is out of the question. Radio is expensive, but is doable for us because we have widespread support. Even though we have roughly a $6-million program and a $5-million media buy, we have to be very careful in our media buying."

The campaign is running every other week through the remainder of 2005. Radio, with some newspaper support, is running in the state's capital, Sacramento, and in targeted districts of certain legislators. Approximately 3% of the program's budget is set aside for research.

Kertman also outlined the funding of the program, first reported by The Credit Union Journal in November of 2004. "For the largest credit unions there are a few at the top paying $200,000 to $300,000 in addition to league dues," said Kertman.

To support its argument, the league showed each credit union what its tax liability would be if the tax exemption were lost.

Kertman noted that prior to rollout there were "thousands of opinions on what the ads should be like," and for that reason it assembled a small group to oversee the creation of the campaign.

One lesson focus groups and other research has shown is that while "not-for-profit" is popular among credit unions, it doesn't resonate as strongly with consumers. Consumers also don't like bank bashing, and want to know what's in it for them, Kertman said.

The Word From 'You-Tah'

No state has had to respond as directly to bank-sponsored attacks as has Utah, where the high penetration of credit union members is offset by the equally vociferous opposition of the chairman of the state's dominant bank, Zions Bank. That chairman, Harris Simmons, is also incoming president of the American Bankers Association.

Scott Sullivan, president of the Utah League of Credit Unions, also acknowledged a problem that Utah shares with every other state, which is that consumers can't tell the difference between credit unions and banks. For that reason the ULCU has set out to capture the essence of the difference and then distill it, Sullivan explained.

"And clearly, we have many credit unions that don't necessarily think this battle is about them," he said. "So we needed a campaign that would do both things. I think we discovered the difference between us and them. The difference is 'you.'"

The Utah league has built its campaign around the word "you," which in print media is set off against a blue circle background. "We are a not-for-profit financial cooperative for you," explained Sullivan. "So for what nefarious ends do we operate? We do it for you."

Because media is less expensive in Utah than California, Utah's CUs are running TV ads. One way it worked to roll out its brand ID was to push its 2004 media buy to the end of the year and the 2005 media buy to the front of the year, giving it six months of consistent advertising. It also created "Bob the Credit Union Guy" who acts as a spokesperson in quirky but memorable advertising. In one spot the quite amiable Bob is shown explaining what credit unions are and what they offer to consumers while also slapping them on the back. As they walk away the viewer sees he has slapped "you" stickers on their backs.

"There is an element of this campaign that I think is unique for Utah. For those credit unions that donated the 50 cents per member, it was vital for us to connect the advertising to the branch experience," said Sullivan.

To that end it developed collateral materials that can be used in branch that tie into the TV campaign. "It has added value to every credit union. It's not focused on the fight, it tells you what's different about credit unions," said Sullivan, pointing out that event the smallest credit union is able to leverage the TV in this fashion.

As Sullivan noted, the advertising has not kept the banks from attacking credit unions.

"We also decided to punch back for the first time," explained Sullivan, pointing to advertising that cited ttwo off-shore operations that Zions Bank was leveraging to cut its tax liability. It also created, which, in conjunction with CUNA's Project Zip Code, has led to thousands of e-mails to legislators, he said.

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