Challenge Of Keeping Up With Credit Union Member Expectations

The Challenge Of Keeping Up With Member Expectations

Consumers today know what they want. They do the research, shop around, and put due diligence into every decision they make. When it comes to their money, most consumers these days have a solid understanding in terms of what the market can give them.

As they choose their primary financial institution, consumers focus in on several key elements, including value, convenience, advice, and relationships with their chosen organizations. This menu of options seems simple enough, but each consumer is evaluating far more than meets-the-eye when he or she decides with which company to do business.

In other words, member expectations have reached an all-time high. As credit union leaders are faced with figuring out how to stay competitive in this ever-demanding world, they’re tasked with finding ways to keep up with today’s uncompromising consumers.

More than 4,000 banking customers in the U.S. and Canada contributed feedback to a recent survey conducted by Accenture. The results revealed that consumers are steadily seeking gains by way of discounts, loyalty incentives, multi-channel experiences that balance digital with real-world encounters, and unparalleled on-the-go convenience. While large credit unions may be up to the challenge of meeting member expectations in today’s market, smaller credit unions with less than $1 billion in assets may find themselves unable to deliver these expectations in a manner that keeps them competitive.

The moral of the story is this: In order to meet ever-changing and evolving member expectations, credit unions need size and scale.

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More for the Money

Everybody loves a great deal, but when your business is directly related to consumers’ wallets, they’re far more likely to pay attention to the savings you can offer them. According to Accenture, 45% of consumers want their banks to do the legwork when it comes to finding them deals and discounts, and 41% look to their financial institution to make the home-buying process easier.

An astounding 63% of survey respondents were willing to give their personal information to their financial institution in favor of having their bank or credit union find them great products and services that suit their lifestyles.

Member expectations in this regard include:

  • Lower prices
  • Faster service (such as loan and credit card approvals)
  • Personalized advice

The Recycle Cycle

Consumer loyalty won’t exist if your credit union is not delivering to your members’ expectations. There was a time when it was difficult for consumers to leave a bank or credit union, and despite a desire to leave, many people stayed put solely out of convenience.

This is a new world, and 11% of North American consumers switched banks just last year. Brick-and-mortar businesses have big competition, as virtual banks saw a 14% rise in use recently, according to Accenture. The study reports that 79% of respondents view their banking activity as transactional, meaning they can perform everyday functions with any firm.

Robo-Advice is Rock-Solid

As far as busy consumers see it, robo-advice is a welcomed feature that makes their lives easier. This algorithm-based helper is seen as a value-added feature for 46% of banking consumers. The main facets of interest are in the realms of retirement planning and investments, but consumers also report seeking robo-advice to help them determine which types of accounts to open and which services would best meet their needs.

Robo-advice is best administered when it’s backed by heavy analytics and humans who can intercede when necessary. This is truly a scale and talent issue.

Competing in the future will require a new type of leader: Data Scientists.

Branches are Still Meaningful Experiences

Despite our reliance on technology, we’re still humans, and humans have a specific need to have face-to-face interaction. Whether they have a problem, or they’re looking for advice, people tend to trust their financial situation more when they can speak with someone in person.

Interestingly enough, even 86% of Millennials (approximately ages 18-34) report that they expect to use brick-and-mortar branches in the near future. Branches are alive and well, and it’s up to credit union leaders to invigorate growth and welcome new members through the front door.

 

Small credit unions may struggle to meet member expectations. Even the most minute of requirements can mean big strains on small credit unions. In fact, we recently discussed how Growth is Costing Small Credit Unions A Small Fortune, and Accenture’s study only reinforces that fact. There are plenty of perils facing small credit unions, but that doesn’t mean there is no positive outcome. In order to meet member expectations, credit unions need to think bigger, and look for opportunities that can advance the size and scale of their current offerings.

Ultimately, a small credit union that has meticulously prepared for the future will be an ideal investment for a larger firm seeking merger opportunities. With proper preparation, everyone wins in the end.

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