21st Century Member Education


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By: Robert McGarvey


Does your member education program know it’s 2018?

Talk with credit union experts and a recurrent message is that most credit unions are leaving a lot of money on the table. They are failing to provide a full range of service to members because their member education programs lag. Many are stuck in the last century, still using in-branch classes, monthly newsletters, and the occasional post office mailing.

Welcome to a brave new world of content marketing that some credit unions now get. “One credit union added content marketing to its strategy and nearly doubled its home equity loans,” said Sarah Snell Cooke, former editor in chief at Credit Union Times and now a content consultant to credit unions in the Washington DC area.

The evidence is thick that smart content marketing drives real results, especially in financial services where member confusions and ignorance often create inaction.

Just what is content marketing?

It’s information that members can put to use. For credit unions, that information is about car loans, home equity lines of credit, and credit cards. It used to be, a lot of this education occurred in the branch, but with fewer and fewer in-branch visits by members, the locus of education has to shift to where the member is.

A key principle behind 21st-century content marketing: the best content is created to serve the readers, that is, the credit union members.

The second principle: always think smartphones, think digital. That rules out long documents and rules in videos, podcasts, listicles, and short articles. Think what marketers sometimes call “snackable content.”

The first step in building a content campaign is to make sure it aligns with the credit union’s overall marketing plan. Cooke elaborated: “If your primary focus is auto loans, then the educational content should be weighted toward shopping for auto loans, costs of auto repairs, how to use an auto-buying service (especially if the credit union has a service), and the like.”

But don’t focus just on car loans. Make a list of all the products you want to emphasize, then start thinking up content that helps support them.

To repeat—go visual, too. “Content” for many means words. But increasing numbers of members want to consume visual content such as videos and infographics. Serve them accordingly.

And don’t stint on content that speaks to the credit union mission, such as info on responsible borrowing, how to raise a FICO score, and how to pick the right share draft account.

Is that sounding like a lot of content and therefore expensive? Know that many credit unions are banding together to buy and share content. That splits the costs and, honestly, sources assured us most credit union marketing budgets have room to flesh out adequate content campaigns.

Remember, too, a lot of this content has a long shelf life. It should be good for a number of years.

What if nobody reads or views the content?

Good question. That’s more common than many admit. But the cure, say the experts, is to continually point members to new content via newsletters and links in online and mobile banking. Also, make sure that the content is high-value, and that helps earn a stronger placement in Google search results.

Always track metrics too. Google Analytics is free and it will give most credit unions plenty of information about what’s getting consumed. Do more of what is working, less of what isn’t.

Bottom line: know that the battlefield is the fight for eyeballs, and better content will win. Know your members, know what they need to know, and help them know it better. That’s a big win.


>The fight now is for members’ digital attention.

>Good content is king. Make it fun, informative.

>Make it member-centric.

>Double down on quality.

>Track results and tweak, tweak, tweak.



Your Next Steps in Digital Reputation Management


By Robert McGarvey


There are dozens of online sites and apps where people may be talking about your credit union—from Facebook with its billions of users to microsites with hundreds of monthly visitors.


They can all affect your standing in your community.


Here is a sample Yelp review of a Phoenix credit union: “STILL THE WORST BANK ON THE PLANET.”


In the same thread, you’ll find this positive review:


“I have been a member of this Credit Union since I was 6 years old. As an adult, it is the only place I’d prefer to keep my money. They are very transparent and straightforward during an era of sketchy business practices.”


Yelp, by the way, can’t be shrugged off—it claims upwards of 180 million unique monthly visitors.


At Credit Karma, there’s a page for credit union reviews. One short review simply reads: “Absolutely terrible.”


Another reviewer describes their negative experience with one of the nation’s largest”” credit unions:


“We applied for a re-financed car loan on Wednesday, it’s now Saturday & we have never heard back. We even have other accounts with them!  We are very disappointed as we were told we would hear something on Thursday. :(“


Bankrate also features many credit union reviews, and so does DepositAccounts, which hosts reviews for hundreds of credit unions. NerdWallet even posts an annual best credit unions list.


The point: the web is awash with credit union reviews and comments, and a person searching for their next financial institution will almost certainly read them.


And then there’s the torrent of quick comments on Facebook and Twitter.


You have a digital reputation. That is a fact that a smart credit union will not ignore, and it’s why you need a digital reputation management plan.


There are two basic approaches. One is to retain an outside vendor to take over the chore for you. Do a Google search for “credit union + digital reputation management,” and you’ll find a handful to contact.


Option two is to pursue it internally. That’s my personal preference because a credit union knows what matters most to its members. But either route will work.


Regardless of which approach you take, start by making a list of websites and services to review weekly—or daily, for especially active platforms.


First, search for your own credit union, and make a note of the sites where it shows up. Edit it down to the sites that matter to you, but err on the side of inclusiveness. You want to be aware of what people are saying about you on many sites.


Here are three tips for successful engagement with members online:


  • Identify which sites allow the business—in this case, your credit union—to post responses to comments. Many will allow this if asked through the proper channel.


  • Never seek to resolve member difficulties online—direct that conversation offline, usually with a personal phone call, but do take the time to express concern online about a member’s unhappiness.


  • Remember that the readership isn’t just the member with a grievance. It’s potentially many thousands more readers. Write any response so that the credit union comes across as caring, responsive, and helpful.


And here are your don’ts:


  • Never, ever post fake positive reviews about your credit union. If a vendor says they can arrange that, show them the door.


  • Certainly, don’t be shy about asking members to post about the credit union on social media. That’s fair. And the more such reviews you get the better your digital reputation.


  • Don’t get into online fights with members and don’t let third-party vendors do it either. There are too many cases where an assistant manager angrily posts, “You are lying! It didn’t happen that way at all!” Stop. Take a deep breath, and remember the thousands who may read your words. Stay amiable, professional, and helpful.



Know that this job is never done. Digital reputation management has become an ongoing concern.



Members Are Talking about You on Social Media: Here’s Your Action Plan


By Robert McGarvey


1 billion: people who are active on Facebook.

300 million: Twitter users.

Yes, they are talking about you and what they are saying will help you succeed—or fail.

Here are some exact quotations from members at social sites about credit unions:

This is the worst financial institute to deal with.

Anytime I walk into this branch, I am NEVER greeted by anyone, ever. I could stand at the front of the line, with nobody else there and wait and wait…and wait to be called up.

I went for a loan through this company and their incompetence is astonishing.

Ouch!  It gets brutal sometimes.

Smart credit unions know this. They have ambitious social media management programs.

Navy Federal, BECU, and others make The Financial Brand’s annual list of credit unions with the best social media programs.

What do you need to know and do to rank among the best?

  • Create a Facebook business page.
  • Ditto on Twitter.
  • Pick a few credit unions on The Financial Brand list, and follow them. Learn from those who do it right.
  • Monitor what people say about you. How hard is that?

 Here’s your never-do:

  • Never respond angrily.
  • Never respond with personal account info. If you are tempted to post, “You got turned down for that car loan because your FICO score would be single digits if they went that low.”…Don’t.

What can you say? Here’s pointed advice from experts.

Rhys Jenkins, Social Media Manager at digital marketing agency Traffic Jam Media:

“Acknowledge the complaint in public on whichever platform it came from.”

“Look to bring the complaint into a private conversation where finer details can be shared.”

Karlyn Williams, Social Media & Marketing Manager at consulting firm StellaPop:

“The worst thing you could do is ignore complaints or questions via social media. It’s best to view negative comments as an opportunity to set the record straight, not go on the defensive.”

Valerie Turgeon, a Digital Content Specialist at Brandpoint, a content marketing agency:

“When it comes to responding to complaints via social media, the key is speed.”

The takeaways for positive engagement with members on social media:

  • Remember these four Rs: Respond rapidly, respectfully, responsibly.
  • And remember this rule of thumb: acknowledge problems publicly, but resolve them privately.

Live in the 21st century: Do all this now.  It’s essential to growing your credit union.





Just How Safe Are Mobile Phones As Authentication Devices?


By Robert McGarvey

The iPhone may be just 10 years old and with it has come an avalanche of unexpected uses – particularly in authenticating members in credit union and bank transactions. But now worries are heard that mobile phones may not be secure enough.

In fact, many credit union security experts admit that the use of mobile phones – either for voice calls or SMS – in authentication may be coming to a close.

Don’t panic. Most experts are counseling a deliberate shift away from mobile phones. No rush.

But know that the industry leaders are already pondering the alternatives.

A story last month in the New York Times puts a spotlight on the concerns. The lead should scare you: “Hackers have discovered that one of the most central elements of online security — the mobile phone number — is also one of the easiest to steal.”

This writer recently – and harmlessly – switched a mobile number from TMobile to Google’s Project Fi and, along the way, threw out an old iPhone and substituted a Google Pixel. The surprise was how little friction there was in the transaction.

No wonder crooks are enticed by the procedure.

But that shouldn’t be a surprise. Think about all of the TV ads that you’ve seen that exhort you to switch carriers and keep the same number. If a lot of consumers complained about how big a hassle that is, it would slow the churn, and the carriers don’t want that.

Thus the hijacks.

According to Federal Trade Commission data, the number of reported phone hijackings has doubled since 2013. In 2013 it was 1038 and in 2016 the number had reached 2658. And nobody thinks the FTC log is complete. There have been a lot of hijacks that nobody thought to report to the FTC.

Worse: get control of a mobile phone and often it is simple to get control of Gmail, Facebook, and other online services that use the mobile number to authenticate identity.

Consider that strike one: it is presently too easy to steal a mobile number and that throws their use for authentication into question.

Couldn’t carriers step up security? Sources told us the big ones indeed are racing to do exactly that.

But that does not solve the problem of why mobile phones are not a cure-all in authentication.

The use of SMS – text messages – to authenticate also is under scrutiny. Many financial institutions and various other online services have made authentication via SMS routine. The problem is that it may not be secure.

The National Institute of Standards and Technology within the US Dept. of Commerce has raised various questions. It points for instance to the possibility that a malicious app on the phone may redirect an SMS to a criminal.

FFIEC has also noted concerns. It has advised: “Financial institution management should employ compensating controls (e.g., redacting customer account numbers when sent via SMS) to mitigate the inability to encrypt SMS messages. Additionally, management should limit the access or functionality available to the customer through SMS banking. When the transaction risk is more significant, management should consider other risk mitigation methods, including pre-registration and the use of security tokens. PINs also could be employed, but are often easier to break and harder to remember. To strengthen the security of PIN usage, management can implement specific requirements (e.g., requiring them to be regularly changed). An institution should update its customer awareness materials to include information on avoiding phishing messages by SMS.”

Many security experts fret about the possibilities of criminals plucking SMS from the ether and, since they are unencrypted, they are easy to read.

How common is that? It may well be rare. But, the fact is, it’s possible, and that worries security professionals.

At Digital Defense, a security company, executive vice president Tom DeSot said: “When our clients implement new systems, we always recommend they use two-factor authentication that doesn’t rely on SMS texts, but rather an app that provides the secondary means of authentication.”

At Congressional Federal Credit Union, CTO David Hufnagel said that the institution still uses SMS, but “we are looking at other options.”

Many other credit union CTOs, who asked for anonymity, echoed Hufnagel.

Bottomline: start exploring alternatives. Many experts point to authenticating apps (Google Authenticator is one such). Others favor services that authenticate a SIM card, that is, the brains of a cellphone. Still, others are looking for something else entirely, that is, something other than the cellphone. Smart credit union executives are already getting ready for the move into the next phase.

Big banks will get there. Know that. Don’t be left behind.

Do Your Members Understand A Credit Union Is Not a Bank?


By Robert McGarvey


What consumers don’t know about credit unions will give you sleepless nights.

Numbers from CUNA data should shake you up. 64% of non-members are not familiar with credit unions, related The Financial Brand. It added that 71% of millennial non-members are not familiar with credit unions, and the problem is that millennials of course, are the future.

Worse: in conversations with credit union executives it becomes plain that many consumers do not get that at their very core credit unions are radically different from banks, and it’s not because banks offer more services, a misconception revealed via polling data in recent Harris research sponsored by Affinity Federal Credit Union in New Jersey.

The real problem is that consumers do not understand that credit unions are owned by their members, not shareholders, and that they are not for profit – and there could not be a more foundational difference. Credit unions exist to serve their members. Banks exist to serve their shareholders.

You know that. But do your members? Do your prospective members?

Bet that most of the prospects don’t. If they did they would be members.

And bet too that many members do not truly get the credit union difference.

Don’t give up hope. It’s up to you to change those beliefs.

Start by accepting the difficulties of the challenge. Banks, especially the big ones, have huge marketing budgets, and they wow consumers with a torrent of ads portraying themselves as friendly, helpful, and perhaps even cool.

Many credit union executives may snort that all those claims are untrue, but the reality is that consumers have been bombarded with bank advertisements.

How often have they seen advertisements by credit unions?

Understand too that over half of the credit unions—upwards of 3,000—have assets under $50 million. About two-thirds have assets under $100 million.

That group may have challenges in directly attacking member and prospect misconceptions.

Chris Otey, a longtime fintech executive who serves as chair of the board at South Bay Credit Union in California (assets around $100 million), shrugged: “I think credit unions struggle to differentiate themselves due to individual scale. Take my credit union for example. We are an 8,000 member credit union with a small footprint in our community. We simply do not have the financial resources to get the word out en masse about credit unions.”

Otey added that in his mind there’s another way to get out the credit union difference: “I have long thought the onus for differentiating credit unions from banks should and can be handled by the state leagues and national organizations.”

Probably all true but there also are steps individual credit unions can take on their own behalf.

Fabian Geyrhalter, a principal in branding agency FINIEN in Long Beach, CA, offered a starting point: “Credit unions have the massive advantage of always having led with empathy, the crucial emotional brand element that members seek and banks struggle to provide.”

Excellent point. Nobody has recently accused the big banks of practicing empathy – but this should be a key credit union differentiator. Credit unions really know their members – that may be especially true in fact in the smaller credit unions – and that message should be continually communicated.

Kirk Drake, CEO of CUSO Ongoing Operations and author of CU-2.0, offered still more concrete suggestions about ways to differentiate credit unions. He pointed to loyalty dividends as a powerful tool: “I believe this is an essential way to show members the credit union difference.”  Banks don’t pay them to customers. Credit unions, many at least, do pay them to members. That’s a powerful difference.

Drake also suggested looking at how other kinds of cooperatives nurture member loyalty and he pointed to REI, the outdoor equipment and clothing company as a good one to study. He especially praised REI’s annual member dividend. The amount is based on the value of the member’s qualifying purchases, and for many crosses into three, even four figures.

He also praised REI’s roster of free training and noted that credit unions could do likewise where the credit union brings in experts to offer workshops.

He added that a key REI initiative is “making the member feel like they own the place” and stressed that credit unions can and should do similar.

Walk into an REI store and you will be reminded that members get dividends – that is discounts – non-members don’t. It’s a soft sell but it is persistent. And it gets across why consumers should shop at REI and not at the many other stores that sell similar stuff.

Right there are plenty of ideas about how to differentiate credit unions.

Bottomline: Never forget, a credit union is not a bank. But also don’t forget that prospects and even many members don’t know that.

It’s up to your credit union to get the message across.


The 21st Century ATM

5 most used gagets in 21st century

By Robert McGarvey

I come not to bury the ATM but to praise its new powers.

Forgive me for borrowing from Shakespeare’s Mark Antony in Julius Caesar, but it’s what popped into my mind recently as I heard many futurists predicting the end of the ATM.

It just isn’t happening. At least not soon.

It certainly isn’t happening in this year, the 50th anniversary of ATMs, devices said to have started at a Barclays in London in 1967.

What will happen instead is that the ATM will get more powerful—we’ll use it to do more. A lot more. Details follow.

First, understand: the ATM Industry Association estimates the number of U.S. ATMs to be between 475,000 and 500,000.

And they are staying busy. “In the month of March, PNC dispensed more cash from ATMs than we have in the history of our ATM network,” Ken Justice, head of the bank’s ATM operations, told the Pittsburgh Post Gazette in a birthday story about ATMs. “Cash demand is still as high as it has ever been.”

Justice is not exactly right about that. According to the most recent Federal Reserve Payments Study, noncash payments have been growing fast: “Since 2000, both the number and value of noncash payments have exhibited significant growth. By number, noncash payments grew from 72.4 billion payments in 2000 to 144.1 billion in 2015, for a growth rate of 4.7 percent per year. By value, noncash payments grew from $75.87 trillion in 2000 to $177.85 trillion in 2015 (both in 2015 dollars), for a real growth rate of 5.8 percent per year.”

Furthermore, a Gallup Poll found that 62% of respondents predict the death of cash in our lifetimes.

But, fast as noncash payments have grown, it is premature to bury cash or ATMs. According to Gallup, 54% of respondents like carrying cash all the time, and 42% say they are not comfortable without cash on hand.

Most of us still like paying with cash at least some of the time, in some places. That’s a fact.

Where do we get cash? For many of us the convenient answer remains the ATM and, personally, I call on one at least once weekly.

The frequency of visits just may go up, as ATMs offer more features to entice us. Karen Kaukol, a vice president at Entrust Datacard, said she expected ATMs soon to offer “bill pay, statement printing, and instantly replacing lost or stolen payment cards. The idea is to shift more transactional bank services to the ATM so that tellers can focus on higher-value customer engagements.”

For instance? Kaukol elaborated with some specifics: “U.S. Bank customers can make donations to the American Red Cross from an ATM and Wells Fargo customers can purchase stamps, print statements, or pay a credit card bill. In the future, we can expect to see additional ATM features such as the ability to make transfers to friends or open an account.”

ATMs also offer contactless payments, at least at some banks, and there are ever-louder talks that we will soon see ATMs that allow biometric log-in—no card or smartphone needed. Just sign in with a fingerprint or maybe a retinal scan.

Furthermore, many institutions are now lifting the upward limit on cash withdrawals to as much as $4,000.

The message for credit union leaders is twofold. For one, assume you will have ATMs in your arsenal for many years to come. Generations of consumers have grown comfortable using them, and they will continue to use them for some years. Sure, the day is coming when this is a cashless society, but that day isn’t coming soon.

Secondly, the big banks are charging forward with programs to build more features into ATMs, and you should do likewise.

Which features? Run pilots or conduct small tests. Discover what your members want to use, and investigate how they will use it.

But know that the ATM as a device for little more than getting cash and checking balances is fast coming to an end.

We are now entering the era of the smart ATM, and that is likely adding years to its role in our lives.




Is Now the Time for Videoconferencing at Credit Unions?


By Robert McGarvey

Videoconferencing is coming of age at retail banking. This much is made clear via polling by Vidyo, a videoconferencing company, CUNA Strategic Services, and Efma, a consortium of financial institutions. Over 80% of institutions polled said they had deployed, or intended to deploy, videoconferencing—under 10% said they had no intention to do so.

The other stat that jumps out is that about 20% of institutions said they were fully deployed – which means that, at most institutions the idea may be percolating but not yet ready to serve members.

Absolutely, videoconferencing is an important technology for credit unions to investigate. But going slow is the shrewd response. At least for now.

What’s the plus of videoconferencing? Easy: consumers can use the tool to connect with trained experts, often at lower cost for the credit union. That’s win-win. The member gets service, and the credit union saves money.

There doesn’t have to be an IRA expert in every branch, or a mortgage refinance pro. Not when one expert in a central location can be brought via video to members wherever they are.

As in-branch traffic continues to slump, smart credit unions will continue to look for tech savvy ways to deliver what members need—likely with fewer in-branch tellers. At the same time, in-branch traffic is shifting away from the simple transactions that used to be the bulk of activity and into more interactions where a member seeks advice and help.

Video is a big part of the answer to how to deliver quality information and service—at low cost.

Just about everybody likes that.

Big banks, too, are plunging into this. Bank of America, for instance, has video terminals in some 500 branches.

What’s the hold up in deploying more video at more financial institutions? One sticking point: a debate is quietly raging between, on one side, advocates of purpose-built, professional grade video conferencing tools typically deployed in branch and, on the other side, consumer-facing technologies such as Apple’s Facetime, which ships with every iPhone, and Microsoft’s Skype.

The advantage of the latter for consumers is that they probably already know and use the technology,,and, furthermore, they have access to it wherever they go.

So what’s the plus of purpose-built video tools? Mihai Corbuleac, Senior IT Consultant at ComputerSupport.com LLC, said: “The main benefit is that you are in control of the product, and your developers can change or improve it as per the requirement. Implementing your own API (application program interface) will offer you more flexibility, and controlling the development process will give you the opportunity to build useful features designed to simplify your business. Skype or Facetime, even if they are fully-featured, they are definitely not industry focused.”

Add in the fact that consumer technologies just don’t come with the same security that accompany video technologies specifically designed for use in financial institutions.

Don’t assume that this is case-closed, however. Understand this: the video conference space is moving very fast. There is plenty of room for innovation and creativity to produce more useful and engaging tools. Developers, for instance, are working hard on virtual reality video conferencing that will bring a kind of three-dimensional quality to the sessions.

Also in the early stages are tools that will allow a credit union to create a secure conference link with a member, no matter where the member may be. That may unite the benefits of in-branch conferences with the convenience and comfort of home.

A lot of excitement is coming down this pike, and all of it is designed to help credit unions make deeper, more personal connections with their members.

A bottomline: deployed properly, video tools will let smaller credit unions rival bigger competitors in the depth and breadth of the expertise they can offer members.

Keep that in mind. Video will let credit unions maximize the impact of their help and advice.

This is a space savvy credit union executives need to watch. Be ready to move fast when the right technology for your situation emerges.