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This article, which originally ran in the Spring 2012 issue of THINK Magazine, seems especially timely as we begin a new year of reaching out to Millennials. Although updating your credit union inevitably involves a million little things, it’s the big shifts in strategy and vision that really transform your organization. Forget the facelift: 2015 calls for a complete makeover.

Changing to Fit a Younger Demographic Calls for a Complete Makeover

Developing the member experience at your financial institution must be strategic. Even more fundamental than strategic, it must be part of your recipe, your ingredients, your constitution. Your relationship with your members must translate into everything that you do. If you want a younger membership, it’s time to shake up the way you do business.

We have all been to seminars on generational marketing. We know that the Greatest Generation is retired and the Baby Boomers are getting old (or have been old but are just now admitting to it). We all study the membership analytics and read the data that tell us our members are aging. In fact, it is frightening to think about the percentage of deposits that will transition in the next five years. Will that money stay in our hands?

My husband’s grandmother recently passed away. Lola was a tall, beautiful and determined woman who worked hard her entire life. She was a credit union member for more than 50 years and managed to save a small amount of money. She wanted nothing more than to help her children and grandchildren build their lives and provide for their families. Upon her passing, her estate was distributed, and my husband received a cashier’s check from his grandma’s credit union. He smiled, looked up to the sky, thanked his grandmother in heaven…

And deposited that check into his bank account.

O.K., so this is a story of one member. One small account. But think about the other three million aging credit union members whose funds may be distributed. Will that money, and the relationships that go with it, stay with credit unions? If not, what do we do? Do we scurry around creating multi-age youth accounts, opening Facebook pages and playing hip hop music in our branches?

I believe the answer is no. Here’s why: When a credit union feels pressure to attract a more diverse membership, many will force youth accounts. This ultimately becomes an awkward relationship.

Ideally, credit unions would develop a strategy to attract, serve and retain Generation Y and Millennials in order to balance membership growth and work toward profitability.

But the unfortunate reality is that many credit unions want to attract young members, yet they’re serving under business models and bylaws that were designed for a much older demographic. Boards of directors have served with loyalty and dedication for 50 years. The staff knows every member by name because they too have served the institution for many years. We feel shackled by squeezed margins and regulatory requirements, so our products are compliant but rarely innovative.

And still, we get energized at our most recent league conference, set out to attract the youth, and charge ahead. We develop so many new share types that the IT department is upset; we spend our fourth quarter marketing budget on fancy brochures. We create hilarious taglines that every employee loves. We set up our Tweeter or Twitting, or whatever the young people are using these days. We launch our new youth program in the branch with cookies and balloons. The entire staff wears purple T-shirts and backwards hats. We give away iTunes gift cards with their first box of checks. We then report back to the board that we successfully opened 100 new youth accounts! Everyone celebrates.

Harsh reality: We now have 100 new members that, like their older brothers and sisters, still don’t know the difference between credit unions and banks. They too are at risk for keeping that savings account open and dormant until one day we are forced to escheat.

Meanwhile, these young consumers are conducting all of their transactions online, making deposits via remote capture directly onto their prepaid credit cards, using their Starbucks mobile apps, conducting business on Etsy via Paypal, and will one day deposit their grandmas’ checks into whatever relevant financial product is ready for them.

You cannot force a youth program on an institution built by, from and for an older generation. If you want the youth to become part of your credit union, change your business model. Change your way of thinking.

I don’t want to discount the longevity or the value of the existing credit union model. I worked with an institution recently that said they have been serving the 60-plus population since the 1990s. Although it’s hard to believe, that means they’ve been serving this same age category for over 20 years. Let’s face it, today there is a whole new generation of 60 year-olds.

So here’s a different perspective: If you are good at serving 60 year-olds, great. Serve them. Serve them well. Find ways to elicit income. There are brands that make millions of dollars every year (Mercedes, Chico’s and Viagra to name a few) from this demographic alone. Create a member experience that makes 60 year-olds feel welcome, well served and in control. Develop a channel for them to distribute funds to their grandkids. And next year, get the 59 year-olds in your door.

If you’re committed to serving 20 year-olds, great. Serve them. Serve them well. Find smart ways to promote savings and deposits. Create a member experience that meets their needs and remains relevant in a very fast-paced, judgmentally chic environment. Develop a channel to electronically capture “checks” from Grandma. And recognize with a business model geared toward a younger demographic, Grandma may not be as interested in doing business with you.

“One-size fits all” rarely fits anyone. Identify your market. Know your market. Build a credit union that truly fits that market, and you’ll make money. No awkwardness required.

Dr. Brandi Stankovic is an educator, entrepreneur, author and artist. She is a partner of Mitchell Stankovic and Associates, a global strategic consulting firm that specializes in credit unions. For more information visit www.mitchellstankovic.com.

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