las-vegas2-fotolia.jpg
Welcome to Vegas!
Disruption was theme on the first full day of the Credit Union National Association’s America’s Credit Union Conference in Las Vegas. Temperatures were hot even by the elevated standards of Glitter Gulch, and the head of CUNA attempted to put some heat on the credit union leaders present by announcing a “big, hairy, audacious goal.” A marketing innovator who was in the trenches when Steve Jobs ruled Apple by fear offered insights, and attendees heard about the need for frictionless financial services.
Jim Nussle 1 at ACUC 2017 - CUJ 062717.JPG
'An opportunity to change the world'
Jim Nussle, president and CEO of the Credit Union National Association, wants to change the world. On Monday at CUNA’s ACUC he presented what he termed a “big, hairy, audacious goal” to several hundred attendees.

“We will not be curing cancer, but we can change the lives of the people around us,” Nussle said. “We have an opportunity to change the world of the people we represent every day.”

An unabashed fan of baseball’s Chicago Cubs, Nussle shared the passion exhibited by his grandmother for their beloved Cubbies. While acknowledging the importance of fan support, he said there is a difference between fans and players. “Credit unions have a unique opportunity to get out of the stands – not just be a fan – and get on the field and be a player. I’m all in, and we need people to dedicate themselves to being all in for credit unions. We need to ensure credit unions are going to be here for years to come. If someone is walking in the front door of a credit union as a board member or an employee he/she might think he/she is all in, but we need to know the why. We have to deal with disruption coming to the marketplace.”

According to Nussle, the industry does not have the “luxury of assuming” credit unions will always be present. The future of credit unions, their relevance, is what is at stake, he insisted. “At any moment, something might come into our marketplace that will disrupt,” Nussle said, pointing to several iconic companies that have gone belly-up in recent years: Kodak, Sears, Sports Authority, Blockbuster, Borders and the Yellow Cab Co. “Did those companies sit at their conferences, pat themselves on the back and assume success?” he asked.
Jim Nussle 2 at ACUC 2017 - CUJ 062717.JPG
Consumers need CUs like never before
Nussle told the audience he often is asked, “Why have this conference?” The answer, he said, is because people today need credit unions like never before.

“Studies find people could not come up with $500 in an emergency. There are financial mud puddles people deal with, and there are dreams, such as owning a house. We help make dreams come true, and CUNA helps make sure the future relevance of credit unions will always be here.

“I am not pessimistic about the future of credit unions, but I am realistic,” Nussle continued. “We have hope, but we also have statistics, data and market analysis. To be relevant, we have to be the best financial partner for people. To be relevant in the future, we have to be relevant today.”

One factor working in favor of CUs: Nussle said their DNA is already set up to meet disruption in the future because credit unions are built on people helping people. “We have example after example of how it has been put to work. The sharing economy is basically what we do. We have been doing this for a long time. And we have a track record to boot; we are not a fly-by-night start-up. We have some of the most cutting-edge technology in the industry. But we also can sit down next to members and help them advance what they want to do. We put their dreams first. That is what being the best financial partner is all about.”

Membership is growing – almost 110 million members strong – but Nussle told the crowd he hoped they could sense “a little bit of urgency” in his voice. He noted he has been president of CUNA for a little more than two years, and said he has spent much of that time listening carefully. “People told me, ‘You need to challenge us.’ They have told me, ‘We don’t want to just be on defense.’ They have said, ‘We want people to understand the credit union difference' and ‘We want lawmakers to respect us.’ So the last few GACs and ACUCs we have advanced the idea of future relevance.”
Guy Kawasaki at ACUC 2017 - CUJ 062717.JPG
Evangelism and enchantment
Credit unions need to focus on enchantment, on persuading people to choose CUs over other financial providers, according to marketing innovator and best-selling author Guy Kawasaki.

The term “evangelism marketing” is attributed to Kawasaki, who helped Apple roll out Macintosh computers in the 1980s. “My job was to convince people to create Macintosh software,” he told the crowd at ACUC Monday. Today, he works for an Australian-based company called Canva.

“Finance is an analog business, not a digital business. It is not about big data,” he said before offering CUs several ways to “enchant” consumers.

Achieve likability
If you want to disrupt a business, you have to be likeable, Kawasaki said. Greeting potential members with a wide, genuine smile is a key part of enchantment. “Make a Duchenne smile – not with the jaw, but with the eyes,” he said. “Crow’s feet are a good thing.”

Innovate and disrupt the technology
Kawasaki ran down a brief history of refrigeration technology in the 20th century, from companies that harvested blocks of ice on frozen lakes to factory-made ice delivered by “the ice man” to refrigerators people could have in their kitchens. “When companies define themselves by what they do rather than the benefits they provide, they do not embrace new technology. If you make ice in a factory, then you are disrupted by refrigerators. Get to the next curve. Anticipate the needs of your members. Be intelligent. Understand problems. Be complete. Great companies are not just deep, they are broad, such as Google. Be empowering. Have products and services that are elegant.”

Overcome resistance
Provide social proof that lots of people are using your credit union, Kawasaki counseled. He noted with Apple’s iPod came out it had white ear buds, which were unusual at the time. The more white ear buds were seen in public, the more people bought iPods – a nice sales circle.

CUs should use a dataset to change a mindset. “Change beliefs by using data to illustrate a point, and enchant all influencers. In some families the influencer is the wife, in my family it is my daughter.”

Learn how to present
When doing a pitch, CUs need to customize their presentation. Kawasaki described LinkedIn as “God’s gift to customization” because you can see what school someone went to, where they have worked and more. “When you present, sell your dream. When Steve Jobs presented an iPhone he did not hold it up and say ‘this is $188 worth of parts.’ It is presented as a beautiful piece of technology that will change your life.”

Use technology to enchant people
Remove the speed bumps to your organization, he advised. “Use social media well by providing valuable information, such as what does this new law or regulation mean to your members. Offer insight and assistance.”

Asked for specific way CUs can enchant their members, Kawasaki said his perspective is many people do not believe they can join certain credit unions due to their names – such as having to be in the Navy to join Navy Federal Credit Union. “Tell people they can use ATMs all over,” he offered. When told that already happens, he replied, “See, I didn’t know that.”

Social media is a disruptive, fast way to get the word out, Kawasaki said. “Give people a reason to follow you on social media. Offer tax tips, let them know how to set up a 529 [college savings account].”
Mark Sievewright, founder and CEO of Sievewright and Associates, pictured during the 2017 CUNA's America's Credit Union Conference.
The world is getting faster -- are CUs?
The credit union business model is changing faster than any of us can imagine, says Mark Sievewright, founder and CEO of Sievewright & Associates.

“Since 1990 the industry has become more and more digital,” he said during a breakout session at CUNA’s ACUC Monday. “In 2016 we started a new phase I call the analytics age.”

Technology is redefining financial services delivery, distribution and money movement, Sievewright continued. He said the plastic card has a future, but in the next five years consumers will have new ways to pay that do not involve a plastic card.

Sievewright also pointed to the demographic shifts that are having a profound impact on growth, relevancy and talent. He said young people today have an “incredible affinity” for technology. “It is in their DNA. If we try to take the old ways to communicate and make them fit with this new generation, we are going to lose them.”

Banking has gone beyond the digital tipping point, Sievewright asserted. He said the industry is gathering momentum toward rapid and wide-scale transformation, driven by technology advances, waves of innovation and a new set of disruptors.

“You hear people talking about frictionless financial services, and we should be talking about it,” he said. “If you were starting a credit union today, it would look more like a fintech firm. Fintech firms do not have legacy technology to deal with. Many credit unions have finite resources to make big changes.”

The next 5 years will make the last 50 look slow, Sievewright predicted. “We will not see the full force of that in the credit union movement, but we will see some spillover effect.”

Credit unions need to redefine the member experience by moving toward omnichannel integration, Sievewright counseled. He said only 4 percent of credit unions have achieved full omnichannel. Some 54 percent report having integrated a few channels, while 30 percent have integrated most channels. A lagging 10 percent have no channel integration.

“Member journey mapping has become an oft-used term. This means map out the steps members have to go through to use your products and services. After creating this map, you can take out the steps to reduce friction.”
MORE FROM AMERICAN BANKER