>Do Credit Union "Values" Resonate with Young Adults?

This entry was posted by Thursday, 24 April, 2008
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>I ran across something tucked away in my files entitled “Top Ten List of Credit Union Values.” You can find them at the YES CU Community if you’d like to check them out.

Finding this got me thinking and I want to post about this today because an overwhelming number of 18-to-30s don’t know the differences between credit unions and other financial institutions. Almost 50% of young adults are either “not very familiar” or “not at all familiar” with credit unions according to CUNA’s 06-07 National Member Survey and it’s 06-07 Survey of Potential Members.

What’s puzzling is that these surveys also found that out of all the age groups studied, young adults are “most likely to say they’re eligible to join a credit union.” That tells me that folks my age only understand that credit unions exist… but beyond a better interest rate on savings there isn’t a compelling reason to become a member.

Yes, it’s tough for credit unions to compete with larger institutions on products and services. Perhaps that bank down the street is more convenient or has more ATM’s. So where do credit unions have a competitive advantage? In credit union philosophy and values.

Why? Because young adults, and people in general, like to know they’re supporting a good thing simply by going about their everyday lives. Being a member of a not-for-profit institution that helps out in the community and gives to their members instead of fat-cat board members is right up our alley. The following, from an article on USAToday.com, helps illustrate this point

69% (of 13-25 year-olds) consider a company’s social and environmental commitment when deciding where to shop, and 83% will trust a company more if it is socially/environmentally responsible. The online study — by two Boston-based companies, Cone Inc. and AMP Insights — suggests these millennials are “the most socially conscious consumers to date.

But how often do credit unions communicate “values and philosophy” and/or do so in a meaningful way that resonates with my demographic? Not often enough, or at least not in a way that we’re able to pick up as demonstrated by CUNA’s Survey of Potential Members. The best I’ve seen is from this YouTube video from the Young And Free campaign in Alberta, Canada.

After you watch the video… check out some of the comments left below the video. They’ll illustrate my point even further. In fact, here’s one of the comments…

…Except for the fact that in reality there ain’t one iota of difference (in North America anyway) between the two!

They’re both indifferent, self-interested financial service rackets.

Communicating how and why credit unions are different is an important aspect of gaining younger members… it speaks to the heart of why credit unions exist and offers another reason for someone to go to you instead of the bank down the street.

The more credit unions can communicate the philosophical differences that set them apart from other financial institutions, the more young adults will want to become members. As I mention in a previous post, it’s called Dominating with Difference.

5 Responses to “>Do Credit Union "Values" Resonate with Young Adults?”

  1. Jonathan Gowins

    >You are right, there are two main differences: better rates, and not being fat-cat :) Unfortunately, people in general, especially Gen Y, could care less about banking. The reason they want convenience, on top of saving time, is because they just don’t care…they want an easy solution and they don’t want fees in that solution. Sadly, the CU difference has been pushed 100 times to no avail, and even though it has value in and of itself, I think it would take one slick marketing campaign to use that truth to an advantage and motivate youth. Just my 2 cents. Thanks for the post.

  2. Kris H

    >I agree with jonathan. It’s so often heard in CU meetings that we simply need to promote the member-owned philosophy and people will come rushing in the door. However, they will rush right back out when they figure out there are no free ATMs in their neighborhood, or they won’t walk in the door in the first place – they’ll look to see that their account can’t be opened online. I think convenience and saving time is where it’s at. That’s something we really need to overcome before we our member-owned benefits can resonate.

  3. Rachel

    >Honestly, from the experience I have with teaching personal finance to young adults and teens, most ask why more people don’t use credit unions. I usually respond that most people are either unaware they exist or don’t understand the difference.

    We really do have a good thing here. If I didn’t believe so, I would quit my job. Credit unions have a lot to offer my generation. Many of whom are interested in social causes and want to feel that they support a “common good”.

    Going “green” didn’t catch on fifteen years ago the way it has today even though the message/and climate haven’t changed much. Why couldn’t credit unions have the same success in promoting their values?

  4. Melina

    >I completely agree with the points you made. In fact, I had a post on this same topic a few weeks ago. @jonathan – I don’t know if the problem is that we don’t care about banking, personally, I just hate taking the time to go to the bank. I like the convenience of doing things on my own time, from my own house. If I could scan my deposit checks, that’s great! If I could apply for my loan online at 7:30 while dinner is cooking and I am waiting for my husband to get home from work, perfect! We need to think about how we really operate and think. I know that I don’t like having to go to the bank, even the convenient one a block from my house. Is this something that resonates with everyone in GenY?

  5. Susan Follick

    >At PSCU Financial Services, and through our ProjectNewAge Initiative, we feel credit unions are very strongly positioned with Gen Y from “shared values” and overall “value proposition” standpoints. We see, in part, key disconnects coming from the fact many (if not most) credit unions don’t understand 1) Gen Y’s lifestyle, 2) media consumption habits, or 3) Gen Y’s unique criteria for brand preferences … knowledge in all 3 areas being critical to an effective Gen Y marketing program. Before credit unions can successfully market products and services to Gen Y, they must fully understand that market and the different communication approaches needed to reach them. Until that happens, unfortunately we see a lot of credit union marketing dollars being wasted.

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