In their classic book, “The Discipline of Market Leaders,” Treacy & Wiersema discuss three marketplace differentiators: operational excellence, product leadership and customer intimacy. Product leadership is difficult to achieve in a highly commoditized marketplace, and operationally, few credit unions have much fat to cut. That leaves customer intimacy as a differentiator and driver of growth.
“The only way to grow business is to get customers to come back for more and tell their friends,” says Andy Taylor, CEO of Enterprise Rent-a-Car. Colleen Barrett, CEO of Southwest Airlines, puts this notion into action: “Practicing the ‘Golden Rule’ is integral to everything we do. As it happens, the natural result of Golden Rule behavior is customer loyalty retention.” If a credit union’s executives are not also active members, why not? What needs to change?
A surefire way to improve the member experience is to reduce “points of pain” or, better yet, to turn member touch points into “wows.” When touch points become points of pain, “bad profits” result. Examples include $27 fees for a $2 overdraft. Another is frantically rushing to one’s branch to find it closed at 5:01 p.m. Compare that to the experience at another institution, which stays open unofficially until 5:15 p.m. The member arrives after 5 p.m., expecting to be frustrated, only to be “wowed” by being welcomed inside.
An institution located in a major metropolitan area learned through research that its only two ATMs were basically inaccessible due to traffic and parking hassles. Its solutions were to reimburse surcharges at ATMs worldwide and to create “online deposits.” Credit-worthy members who mail their deposits and notify the institution by e-mail receive immediate credit.
Tools such as Net Promoter Score surveys, member and employee focus groups and ongoing transactional research can uncover points of pain and understand the member experience. Research is not an expense to be avoided, but an investment in enhancing member intimacy and growing the credit union through differentiation.
Neil Goldman is senior partner of Member Research. He can be reached at 310-643-5910 or ngoldman
