Wanted: More Apostle-Members

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How many of your members are also "apostles?"

Turning members into apostles should be the goal of every credit union, according to one person, who called such apostle-members "priceless."

Tony Alessandra, author of several books on sales techniques and building relationships and holder of a Ph. D in marketing, told NACUSO's annual conference here that there are four levels, or "stairs," of member loyalty.

On the first stair, the member is a "prospect," on the second a "sale," on the third a "repeat member," and on the fourth, an "apostle." CUs must rely on different skills for each stair: marketing, selling, service and relationship skills, respectively.

Even on the first stair, Alessandra recommends CUs keep an eye on developing potential apostles.

"If credit unions believe in the 80/20 rule -that 20% of members supply 80% of revenues-shouldn't their prospecting be directed at the top 20%?" he asked. "The best way to find new members who fit the profile of the top 20% is to ask another top 20% member. Ask for new members who are looking for a solution that the credit union does better than banks."

On stair two, selling is easy, but repeat selling is not, he said. To move a member from the second stair (a sale) to the third (repeat member), CUs must get members to use additional loans and services.

"Credit unions have not communicated enough that they offer loans and products besides car loans," he said. "Many people think of credit unions as a great place to get a car loan, but that's not all they do."

Many elements must come together to lift members up the final step to stair four where those members also become apostles, according to Alessandra. Members must get value from their financial relationship with the CU, credit unions must create a "perception of difference" that distinguishes them from other institutions, CUs must exceed members' expectations, and they must build an emotional attachment with members.

"If there is an emotional attachment, it is so much harder for members to stop doing business with their credit union," Alessandra said.

Credit unions build value for their members by finding out what those members want. But getting answers to that question can be difficult, according to Alessandra, who suggested mass surveys can be misleading because they yield an average of all members. Instead, he recommended polling the top 20% members one by one, asking them what they value in their credit union. When a CU does a targeted survey in this manner, it can do a proper needs analysis for its best members, he said.

A good way for a credit union to create and maintain a perception of difference from competitor institutions is to have all employees who have member contact make a list once per quarter of the advantages and disadvantages the CU has versus banks, brokerages, insurance companies and any others in the local market.

"The people who have member contact should make the lists, because they are the ones who hear what members are saying," he said. "The board should sit down each quarter and read each person's list individually."

Cross-selling additional or related products is a significant weakness for many credit unions, he continued. When a member/customer utilizes only one service from a financial institution, there is a 50% chance that person will leave within 12 months. If the member/customer has two services, the chance of ending the relationship drops to 10%. Alessandra referred to this phenomenon as "putting golden handcuffs on members."

In order to exceed members' expectations, credit unions must make sure those expectations are not too low or too high. CUs cannot wait until the end to check with members to see how they are doing, he said, because the longer a problem persists, the harder and more expensive it is to fix.

"Encourage members to complain when they have a problem. If people don't complain, they let it fester. Give them a non-threatening way to vocalize their problems."

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