“The gap between your members’ technology behavior and your credit union’s technology behavior is getting wider and becoming more apparent,” says Brett King, founder and chairman of Movenbank, and author of the book “Bank 2.0.”
King says the fact that the average age of credit union members isn’t coming down is indicative of this widening technology gap.
King spoke Monday morning to attendees of the CUNA Technology Council and the CUNA Operations, Sales & Service Council annual conferences, held concurrently this week in Las Vegas.
Many credit unions have an outdated mindset and believe members define convenience in terms of branch offices and ATMs, says King. Younger members, however, define convenience with smartphone apps. Branch transactions have declined from an average of 11,400 per month per branch in 2000 to 6,800 in 2011. And 18% of branches are unprofitable today, he says.
“Your credit union’s value proposition is defined by a younger generation in terms of mobile banking,” says King. “The average age of credit union members is in the 40s because young consumers don’t think credit unions have state-of-the-art mobile banking applications.
“You shouldn’t define your value proposition in terms of service or advice,” King continues. “Service today is defined primarily by the quality of your mobile banking application. It’s no longer defined by a smile and remembering a member’s name.
“More than 90% of consumers say they can’t remember getting good advice from their financial institutions,” King adds. “Good advice is largely a myth. The thinking that a financial institution is the sole provider of ‘good advice’ is outdated and came from the age of ‘information scarcity.’ Now, your members have access to tremendous amounts of information and often know more about financial products than your front-line staff.”
Other tips from King:
As millennials emerge in the workplace, CU leaders modify their management approach and expectations.