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Striving to Appeal to Behavior And Attitude to Boost Loyalty

There are two main types of loyalty that have been widely accepted within academic circles,  attitudinal and behavioral loyalty.

Behavioral loyalty is where a consumer will repeatedly purchase a product or use a service without any conscious or active thought. There are many different reasons why a consumer may succumb to behavioral loyalty, whether out of routine or convenience. Attitudinal loyalty is where a customer will go out of their way to actively seek a specific store, company or brand with which they wish to do business.

As credit unions, most of us strive to that ultimate goal of full attitudinal loyalty. We want our members to love us, love who we are, what we do and what we stand for. We want our members to come to us because we are credit unions, faces behind finances, friends. But do your members view you this way?

Members may join under this pretence, but after joining, do they continue to use our services because of their deep routed ethics and emotions? Or because that is simply how they now conduct their finances?

When a member is behaviorally loyal, they will continue to use products, which for credit unions mean they will take out multiple loans, sign up for insurance products and more. This is the foundation of our business. Without lending, we cannot make the profits we need to show returns for our members.

So the conundrum. Do we want attitudinally loyal members, or behaviorally loyal members?

The answer in short: We need both.

We need members who will be our advocates and tell their friends how good we are, how we can help. But we also need members who will keep using us just because. You’re going to find fewer attitudinally loyal members than you are behaviorally loyal ones, and that’s OK. The attitudinal ones will keep singing your praises. The behavioral ones will keep using services. Hopefully, they’ll rub off on one another.

Always strive to give members the kind of service, guidance and support that converts a behavior into an attitude.

This article was originally published in CU Times on March 8, 2013.

Change·CU Times

Feed Those Zombie Brains

I’m a huge fan of “The Walking Dead.” I loved the comic series, and I’m pretty much addicted to the AMC television series it produced. “The Walking Dead” will soon wrap up its third season, and we’ve seen our cast of characters go through quite a lot. At times, they grow by bringing in outsiders. At times, they shrink because…well, because a zombie ate one or two of them.

Zombies are a pretty big cultural phenomenon right now. Between dozens of movies (“Warm Bodies,” the upcoming “World War Z”), video games (“Left 4 Dead,” “Resident Evil”) shows and, yes, even a song or two. Jonathan Coulton’s “Re: Your Brains” tells the story of a group of zombies led by a mid-level office manager zombie who, very politely, ask to eat their co-worker.

Naturally, a few enterprising credit unions and marketing vendors have come up with zombie-themed campaigns to ride the wave of zombie-mania. CU Swag came up with an “off-the-rack” campaign pack that features a running zombie theme to help sell you a car that can escape a stumbling horde of monsters. E&A Credit Union in Michigan came up with a similar idea and a decayed, stressed-out version of their logo to boot. 121 uses zombies and zombie-themed cards to push loans. IC Federal Credit Union came up with an animated video that asks viewers, “How can you support your family if you’re a zombie? Through life insurance!

They’re all pretty approachable campaigns. The zombies aren’t particularly terrifying and there’s not a lot of complicated explanation. The goal is, as it always should be, to make an idea a little more digestible.

Yeah, I know, “zombies” and “digestible.” Just bear with me.

I can’t speak to the success of any given one of these campaigns. I went looking for specifics of loan growth and account origination for each and didn’t come up with much in the way of numbers. Assuming zombies hold out as a cultural phenomenon (vampires were all the rage a few years ago and are now beginning to wane), campaigns such as this might be around for a few years to come. I’d argue that it’s kind of fun around Halloween, considering everyone’s in a spooky mood anyway. But what’s the real value of the zombie as a marketing tool?

The campaigns themselves focus on the idea of survival–being able to escape, having provisions, staying alive. Indeed, that’s the appeal of zombie media. It challenges you to ask yourself, “How prepared would I be if society broke down?” The answers aren’t easy and the more you think about it, the more you realize how much there is to consider. Finance can seem like a chore, but we all know it’s important to have a safety net, even though very few of us follow through with creating one. The Financial Brand recently reported on a study that showed almost 50% of Americans are unprepared for a financial disaster. They have no savings, subprime credit scores and no liquid assets.

In the interest of providing teachable lessons, I’d advise you to check out these campaigns.

And definitely read Max Brooks’ “The Zombie Survival Guide.” It looks at zombies as a real threat with real causes and real effects. Best of all, it has critical guidelines for readers to follow if, in fact, a “zombocalypse” ever does rear its ugly head. How can you apply some of Brooks’ “Rules for Surviving a Zombie Attack” to your member relationship strategy?

Organize before they rise. A warning to be prepared well before you have to go scrambling for provisions. This is important when talking about savings, a 401k and share certificates.

The feel no fear. Why should you?  Another way of saying don’t panic. Finances can freak people out almost as bad as a zombie invasion. It’s up to you, the credit union, to make finances understandable and manageable.

Keep moving, keep low, keep quiet, keep alert. When it comes to money and account protection, convince member not to use passwords and login credentials that are easily guessed. It makes them a target for hackers. As alerts go, setting up balance reminders and withdrawal alerts can help a member avoid overdrafts.

No place is safe, only safer. In a zombie scenario, one should never get too comfortable in one’s current position. There’s always a way to be a little more careful. Consider reinforcing the idea of preparation to members. It’s never a bad idea to have an emergency line of credit or savings bundle, just in case.

An informed, active member is a good member. Help members build better brains by educating them, preparing them, and alerting them to possible pitfalls, not only with zombies, but all year round. Don’t bother with the wallet, go for the head.

This article originally published in CU Times on February 20, 2013.

Community Development·Crash the GAC·CU Times

Commercial Lending & Heating Up the Economic Kindling

As we saddle of for Crash the GAC in just a few weeks, Crashers are diving deep into the world of small businesses. Their projects this year will focus on the challenge: “How might we make it easier for young entrepreneuers to launch and run a small business?”

In a CU Times op-ed last month, Filene’s Ben Rogers says small businesses will play a critical role in rebuilding the U.S. economy, but their financing challenges are a barrier:

“The U.S. economy is struggling to catch fire after years of recession and slow growth. One of the essential components of economic energy, business lending, is simply hard to come by. A November survey from the National Federation of Independent Business shows that “more [small business] owners expect that it will be harder to arrange financing than easier.” The Federal Reserve’s October survey of senior bank loan officers shows that while credit is slowly easing, it is still hardest to come by for small firms. Kindling needed.”

He goes on to explain that credit unions have a better and more consistent track record of commercial lending, even through challenging economic times:

“…While credit unions, as an industry, are newer to commercial lending, their delinquency and chargeoff rates compare favorably to those at commercial banks – scoring as well as or better than banks on both counts in almost every quarter studied.

Credit union commercial loan growth has been steady during the 15 years examined by Smith. More importantly, it has been resilient during the last two recessions, suggesting that credit unions can buoy both lending growth and, as a consequence, overall business activity.

While banks tend to contract commercial lending during economic stress, the opposite is true for credit unions. Commercial loan growth rates for banks turned negative following the recessions beginning in 2001 and 2007, but credit union growth rates remained positive during both periods.”

This reinforces the importance of credit unions role in economic growth. Commercial lending has implications for positive impact that go beyond the small businesses themselves.

Full piece here: http://www.cutimes.com/2013/01/09/guest-opinion-business-loans-are-economic-kindling

CU Times·Ideas·Leadership·Professional Development

Will Your New Year Have Goals and Actions?

I recently had lunch with a respected business contact and friend. During our conversation about 2012 successes and direction for 2013, we got on the topic of goals.

If you follow business bloggers, authors and speakers, you are familiar with the concept of goals, and how vital they are to getting better personally and professionally. Successful people get that. But my friend said something that struck me. “I don’t have goals. Taking action is more important.”

Goals are a stepping stone to taking action, and it got me thinking about why so many people fall short of their goals. If you fail to put a plan in place to reaching them, goals become meaningless, and getting better seems unattainable and overwhelming.

The hard work in setting goals is continually striving to reach those goals even when your motivation and energy are not there. Here are some steps toward effective goal setting and achievement.

Find your true vision. Whether you are a CEO with big plans to take the credit union in a new direction, an executive wanting to take the next step on the ladder or an individual who wants to take a new path in life, finding out that true vision and then mapping out the steps to accomplishing that vision is just as, if not more, important than the goals themselves. Your vision comes from the things you truly value in life. Whether it is family, having a flexible schedule, financial independence or security, we all structure our lives around the things that we value most. These values will determine your vision.

Once you find that vision, clearly define your goals on paper. Make sure they are specific, measureable, attainable, relevant and time bound. If you want to be a better leader, you cannot just set a goal to do so and then not take regular action to learn what that means, such as by reading leadership books, hiring a coach or finding a mentor to hold you accountable. You can’t say, “I want to lose 50 pounds” without mapping out a plan to eat healthier and become more active.

Set goals around things that you actually plan on doing. Perhaps your goal is to become better at public speaking. If you know in your heart that you will never actually go through with it, setting this goal will only decrease your self trust.

Make sure your goals are in line with your true vision. You must have the right goals in order to get where you are going. Check to make sure the goals you set are actually in line with the vision you have for your life and your career.

Dream big. Realize that nothing is out of your each if you set your mind to it and write a plan to getting it done.

Identify who will hold you accountable. Whether it is a spouse, close friend, mentor or business coach, accomplishing goals requires accountability. Let this person in on the plans you have, and task that person with holding you accountable along the way.

As we ring in 2013, I wish you all the best in setting goals as you take the most important step–action–to reaching them and becoming the best you can be. Start today.

This article was originally posted on CU Times on January 16, 2013.

CU Times·Gen Y·Leadership

The Next Generation of Volunteers

Gen Y, 76 million strong, will play a monumental role in what is projected to be, the largest transfer of wealth in the coming decades. With the average age of a credit union member at 47, credit unions continue to struggle to attract younger members. It is imperative that we not only tap into this segment to add to our membership, but also for our leadership and especially for our volunteer base.

For a generation that wants everything here and now and thinks that a Facebook post is more important than a face-to-face conversation, we need to develop and harness the energy of these future volunteers. It will be detrimental to the future of credit unions if we do not understand and morph to meet the needs of this emerging membership segment.

How do we attract Gen Y? Not just as members, but as leaders and volunteers. The answer, well part of the answer is get them involved. A couple of ways to do this is by creating a young adult advisory committee, junior board members or just recruit Gen Y members to your board. What better way to move your CU forward and meet the needs of the generation that is in their peak borrowing ages of 25-44, than to have representatives from that group in the room when those decisions are made?

So how do you do this? First, identify internal staff and management that would be a good fit to reach out to your younger members. Ideally, they will believe in the movement and act as mentors. Second, establish the charge or assignment for these new, younger volunteers. What do you want them to accomplish? What role do you want them to have with senior management or the board? Third, using your internal champions, start the recruitment process. Use delivery channels preferred by Gen Y (Facebook, Twitter, social media) and ask them to step forward and volunteer for their credit union. Last, implementation. Once the three steps have been completed, put the committee or board members to work. Have them start fulfilling the duties of helping position the CU to meet the needs of a new generation.

This option is not the cure-all for tapping into Generation Y. Nor is it a guarantee for lowering the average age of our membership. But having members of Gen Y in the room when decisions are made or plans and promotions developed will include a new prospective and insight into the needs of a unique generation. Times are changing, our membership base is changing and we need to change with them to remain a viable option for our members.

This article was originally published in CU Times on December 5, 2012.

CU Times·Technology

Hacked Vs. Smacked

Every day, I struggle to remember all the passwords I need to keep my life in order. It feels like I’m going crazy at times, but I’ve walled off the part of my brain that tells me to take the easy way out. I can’t start thinking that way. Why? I know the difference between being hacked and being smacked.

When you get hacked, another person gathered information about you and uses that information to fish out the data they want. Most fraud attempts start far away from the target, gathering up all the information there is to get around the edges of the victim’s life. It’s done that way because the information you give away can say a lot about the kind of passwords you use and the barriers you have to build for yourself to protect your pertinent info.

When you get smacked (my own term), you use an easy-to-guess password that comes back to haunt you when a potential identity thief guesses it in mere seconds. I call it getting smacked because you’ll be smacking your forehead afterward, wondering where you went wrong.

SplashData, an app developer, just released their 2012 list of the worst passwords. These are passwords most frequently found in hacker-space, stolen by a malicious programmer and posted for the world to see. They will shock you or just make you shake your head.

The fascinating thing is that the top three worst passwords in the world (which are “password,” “123456″, and “12345678″, respectively) are the same passwords with the same list position as last year. Apparently, not enough people learned their lesson.

Why should we care? Well, there are the obvious reasons. We want everyone in our organization to have strong passwords that change regularly. But for one moment, consider the member and how crucial this advice is for their sake. Trust is an interesting and ever-shifting thing online. For the longest time, buying something over the Internet seemed foreign. Now, it’s commonplace.

Members should be instructed to create good passwords, to maintain them, to never share them or email them to anyone, and to change them periodically. Identity theft affected 11.6 million people in 2011, according to Javelin Strategy and Research. As organizations that pride ourselves on service, teaching our members to avoid getting smacked should be one service we’re more than happy to offer.

This article originally published in CU Times on November 5, 2012.

CU Times·Gen Y·Governmental Affairs

Gen Y Must Join the Fight

In 10 to 15 years, the majority of the senior management team at your credit union will retire.

Then what?

The stewardship of credit unions will be passed to our generation. But will we be ready? What about now? If you are 20-something, or (gasp) 30-something, you should be concerned about the future of credit unions.

Credit union lending to businesses has been limited to 12.25% of total assets for the past 14 years. Some credit unions have reached that cap. Some have a ways to go. Regardless, credit unions are asking Congress to raise the cap to 27.5% of total assets. This would create jobs and energize your neighborhoods, all free to taxpayers. Not surprisingly, banks strongly oppose our request.

Credit unions can probably survive without authority to make more small business loans.

What concerns me is, if we allow banks this win on this issue, what will stop them from launching other attacks, such as coming after our not-for-profit tax status? In fact, it appears that banks in some states, including in my state, Washington, are starting a time to tax credit unions campaign. CUNA officials warn there also could be serious discussions about our tax-exempt status as Congress faces increasing pressure to reduce the federal deficit.

A loss of our unique tax status would mean higher interest rates and lower deposit rates. Credit unions would begin to look more like banks. Our very essence would change.

Alternatively, if we win the MBL cap issue, it will show that credit unions have turned a new corner, become stronger, better organized and more politically effective. It will send a message that we won’t sit by idly as the credit union industry is threatened after a century of helping communities, businesses and individuals, including many who received unfair treatment from banks.

As young credit union employees, we cannot allow our senior management team to do all the heavy lifting. Those of us who will be in this industry for the next 25 to 40 years have the most to gain or lose with regulation and legislation outcomes. It’s time to advocate for our members, our communities and, yes, for our own self-interest, to protect our financial future and our careers in credit unions.

We often hear that politics is a dirty business. If that’s the case then let’s get dirty and go to battle, side-by-side with our executive teams and board members.

This article originally posted in the October 7, 2012 issue of CU Times.

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