By Steve Williams
Social media…
Mobile banking…
The end of free checking…
Post-Durbin payment strategies…
Online lending and account opening…
A new era is emerging for credit unions that will require a different playbook than existed before our industry came to a screeching halt from the housing bust and financial crisis. In recent months, I have worked with boards of directors and management teams on their future vision concerning how financial cooperatives will create value. In these discussions it is clear that re-architecting products around relationship value and optimizing both the cost and revenue potential of delivery channels are critically important items for the future. Today, a credit union’s product strategies must involve more than just offering the lowest price in town, and channel strategies must acknowledge that investment resources are not infinite. Astute credit unions are beginning to focus on how deeper, more engaged relationships drive profitability and value creation, and they are looking to better define the role and expectations of each delivery channel. While convenience is the major focus of delivery channels, lowering overall delivery costs with self-service and becoming more effective with marketing and cross-selling through remote delivery channels are also priorities. I see credit unions delving into new product packages that encourage members to use checking and card products and to actively borrow. I also see new creative attempts with online marketing and data mining to capture more share of wallet while members use e channels.
To maximize the value of products and channels, credit unions must become more disciplined, analytic and creative in how they plan and roll out their offerings. Innovators in the future will create win-win situations in which members receive more value from bundled offerings and access user-friendly remote delivery channels while the credit union bolsters revenue and lowers its average transaction costs.
To address this new era, CUES and Cornerstone Advisors, Inc. have developed the CUES School of Product and Channel Management. This new curriculum has been designed to help credit union managers understand the new rules for creating value and to provide practical tools for developing and managing product and channel strategies. I hope your credit union will send one of its more energetic, creative and ambitious team members to this exciting development opportunity in Chicago on September 28th and 29th in Chicago. See you there future retail value creators!
Steve Williams is principal at Cornerstone Advisors, Inc., Scottsdale, Ariz.
