There is a serious consumer awareness problem around American options in financial services. Put more bluntly, credit unions have a serious awareness problem.
Forty percent of non-credit union members do not know they have the ability to join a CU, and only one-third of all millennials can identify a CU as a financial institution, according to research we will present at the CUNA America's Credit Union Conference.
This "awareness gap" cedes market share to banks. But more significantly, it leaves millions of Americans without the benefits of credit union services, and jeopardizes the movement's potential to serve more people and communities for generations to come.
That's why it's time for us to act. Confidence in banks has fallen 22% in the past decade and, across the board, negative sentiments over Wall Street and big banks have only grown. That, while study after study names credit unions as the highest-rated financial institutions in the market.
By tapping into the overwhelmingly positive sentiments that credit unions elicit from members, by spreading awareness of the simple fact that credit unions are member-owned, not-for-profit, cooperative financial institutions, we can drive membership growth, strengthen member engagement and even enhance our advocacy work.
Combing through 16 years of credit union research that included more than 16,000 interviews, expert researchers Keith Frederick and Jan van Lohuizen's identified four key messages that will be critical to spreading credit union awareness and carving out an unmistakable market distinction from banks:
- Credit unions are different from banks;
- CUs are not-for-profit;
- CU are member-owned; and
- CUs return earnings to members with lower fees and higher interest on savings.
Responding to a national poll after viewing CU television ads, a full 82% of bank-only customers said they were interested in moving their accounts to a credit union; two-thirds of members said they would likely make their credit unions their primary financial institutions; and 88% said they would support their CUs in a public policy fight. Membership growth, greater share of wallet, increased advocacy engagement. It's all right here. So what to do with it?
At ACUC, we will preview a targeted awareness initiative that will be crafted to allow CUs to easily bake research-tested messaging into their awareness work on an ongoing basis, providing a way to communicate the credit union difference, strengthening existing member engagement and bringing in new members over the long-term.
CUNA will act in a high-level strategy and advisory role, but this initiative's success will hinge on the guidance and support of Leagues and individual credit unions, who know their members and markets best.
Teresa Freeborn is chairwoman of CUNA's Awareness Advisory Group and president/CEO of Xceed Financial CU, El Segundo, Calif.
