Strategies Not Worth Ducking; Worth Some Thought

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Talk about your quacky concepts.

What is it exactly about advertisements featuring a photo of a duck and then some version of the expression, "If it walks like a duck...," that so many creatively-challenged advertisers find appealing? In this case it was the ad that appeared recently in the Washington newspaper Roll Call that attacked credit unions on the interchange issue and was headlined, "If it walks like a bank, talks like a bank, quacks like a bank, it should be taxed like a bank."

To add to the faux cleverness, the ad, sponsored by a group calling itself American Family Voices, had Photoshopped the picture of the duck to show it smoking a cigar (this being based on the poorly-kept secret that most credit union managers are closet stogie smokers).

The ad was run to attack credit unions for siding with banks in their opposition to the amendment to regulate interchange income. Originality was apparently not a prerequisite, as the ad looks mighty similar to similar creative from the American Bankers Association, which has run its "duck" ad on numerous occasions. One would think American Family Voices-and we're going to stretch here a bit and suggest there wasn't an American family voicing anything that led to the ad-would have noticed the bankers got little more than goosed when they ran their version.

"The credit unions are carrying water for the banks on the swipe fee issue, so if they're going to carry water for the banks, maybe they ought to be taxed like banks," said the leader of American Family Voices.

Get it? Carrying water! Ducks! Meanwhile, I'm sure that other bird currently shilling for AFLAC is getting worried.

By the way, for trivia's sake, it's generally believed that the "If it walks like a duck..." expression should be credited to the so-called "Hoosier poet," James Whitcomb Riley, who, sometime between 1883-1885, wrote, "When I see a bird that walks like a duck and swims like a duck and quacks like a duck, I call that bird a duck."

• Why are so few Americans unlikely to give much thought to the duck's message? As Fabio Biasella, VP and managing director of Strategic Advisory Services with Raddon Financial Group, recently noted at the CUNA CFO Council's annual meting, "When you ask the consumer 'Are you upset with the big banks?' They say yes. 'Are you willing to move?' They say yes. 'Are you upset with Wall Street?' They say yes. They look to us as their trusted advisor. There is a real opportunity to recast this, and not to just kinda, sorta participate." Biasella appears to be right.

As Credit Union Journal reported June 21, credit unions have for the first time in history cracked the 10% threshold in consumer household marketshare.

To grow that marketshare further, Biasella advocated credit unions get more aggressive in offering Wealth Management services. "Research shows that for Gen Y the economic implosion of the recent 24 months will be that seminal event, as maybe the Depression was for their grandparents or great-grandparents. Nationally about 20% of CUs offer investments; when you look at high-performing CUs in our studies, 36% offer investments and insurance. What percentage of members have an investment product? A whopping 3.3%, so not a lot of member driving the bus. But they create a lot of net income for the financial. We are running into some realities we have to deal with: the money we have to deal with is not in intermediary deposits. Nearly two-thirds of the typical consumer's wallet is held in mutual funds. Much of that is in 401(k)s, but eventually they are going to have to manage those 401(k)s. This is where the money is."

• During a discussion on credit union mergers during that same CFO meeting, Norm West, CFO at Alaska USA FCU in Anchorage, shared this story. "A number of years ago we merged a credit union that was the product of a number of other mergers and it had a 40-member board. And about the only thing they could agree on was that they needed to merge."

• Later in that discussion, after one person talked of "mergers of equals" among credit unions, Scott Waite, CFO at Patelco CU in San Francisco, said he didn't agree. "I have to tell you, I don't buy into the concept of a merger of equals. Someone has to be the acquirer. My goal in our mergers is to make it profitable within 12 months. People are going to have to go. Contracts are going to have to change. Moving forward is hard to do as a merger of equals. I think someone has to win in the deal."

• Considering forming a committee for some new initiative? Consider this observation from Apple's Steve Jobs. "You know how many committees we have at Apple? Zero. We're organized like astart-up. We're the biggest start-up on the planet."

Frank J. Diekmann is publisher of Credit Union Journal and can be reached at

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