Zappos, Old Spice Guy, Red Bull, Under Armour… and Credit Unions?
There are even more if we hop into the Delorean and look at examples over the years.
One I’m particularly fond of is the comparison between credit unions and other financial institutions with that of small innovative companies and their larger competitors. In fact I even wrote about it on the YES Credit Union Blog back in 2006 using Red Bull and Under Armour as examples.
Both have evolved since the original post–Red Bull has increased their product line and now competes to retain its market share in the functional beverage market while Under Armour has entered new sports apparel niches–but I think you’ll still find the examples relevant.
What do you think… does the post hold up in today’s world? Is this even a valuable comparison? Here is the original post:
Wednesday November 29, 2006 – Dominate with Difference
I like to compare the credit union/bank situation to that of smaller competitors/larger competitors in other industries. The credit union movement can learn a thing or two.
For example, Red Bull Energy Drink was a no-name product a few years ago, but has now become a popular product with the 18-to-30 demographic. They may not come close to Coca-Cola or Pepsi in relation to the overall amount of product sold just as credit unions can’t compete with certain aspects of larger financial institutions. However, Red Bull has positioned itself as the leader in the niche market of energy soft drinks and a hip alternative to major soft drink labels. As a result, Red Bull continues to out sell energy soft drink products from these larger competitors by a very wide margin.
The same is true with other industries such as sports apparel. Under Armour–another popular brand with young adults–was recently established by a Senior in college. In just a few years Under Armour made a name for itself with their line of sports apparel rivaling industry giants. Just like Red Bull Energy Drink, Under Armour positioned itself as an alternative to established sports apparell juggernauts such as Nike, Reebok, and others.
How did they do this? In my opinion, they did something well and stuck with it. Red Bull and Under Armour found a niche, specialized their product, and didn’t get carried away with additional product offerings. For example, Red Bull only sells two products, a regular and sugar free version. Under Armour is known for light, fast drying sports apparel providing an “edge” to athletes. Additionally, these two companies marketed their products as something different, as a “cool” alternative, as a counter culture to the “establishment”.
Of course, there are a number of variables that brought success to these examples. And while Red Bull has continued to offer the same two products, Under Armour has expanded their product line. However the underlying principles have remained the same… capitalizing on what made their products different from the status quo, and not trying to be all things to all people.
What does this mean for credit unions that want to better serve the 18-to-30 demographic? The way I see it, credit unions are in a unique position to be the Red Bull or the Under Armor for the financial services industry in the eyes of young adults.
Credit unions are intrinsically different than any other financial institution. We can dominate with that difference to become a true alternative for this demographic to big banks. We can offer superior service, unique products that meet the needs of 18-to-30s, and most importantly communicate the credit union philosophy to separate ourselves from the crowd. Doing so develops our own niche with a generation of young adults who crave something different.
What do you think? Is this a fair comparison? Are credit unions really positioned to move in this direction? If credit unions move in this direction, will we alienate other members? Click on the comment link below to share your thoughts.
(This is a good moment to mention CUNAverse will be adding many of the original posts from the fledgling YES Credit Union Blog, CUNA’s first foray into the blogosphere… the blog has a lot of excellent content from the 2006, 2007 and 2008 YES Summits, the 2009 Community Credit Union and Growth Conference, including posts from Christopher Morris, Ramit Sethi and others. More on this in the near future.)