To better understand how emotions shape members’ perceptions of their credit unions, CUNA Mutual Group recently conducted research that examined emotions at two different levels:

• Anxiety related to consumers’ overall financial situation.
• Emotions arising from specific episodes consumers have while using different financial products.

This article shares a few highlights from this new study.

New insights about financial anxiety

Unsurprisingly, research firms, such as JD Power, Gallup and Kantar, have tracked an increase in consumers’ anxiety, worry, and stress since the beginning of the pandemic. Rising financial anxiety has important implications for financial institutions:

Consumers experiencing financial anxiety tend to give their primary financial institutions significantly lower loyalty ratings.

These consumers also tend to give lower customer experience (CX) ratings to their most recent interactions using their checking account/debit card, loans, insurance policies, and savings/investment products (see Figure 1).

Figure 1:

While it’s unfortunate that some consumers are experiencing elevated levels of financial anxiety, it represents a tremendous opportunity for credit unions to turn this anxiety into a positive emotional experience for their members. To do so, credit unions need to identify members experiencing financial anxiety. Data and analytics could be used to flag these members, using criteria such as frequent overdrafts, chronic low balances, or delinquent loans. Once these members are identified, credit unions can decide what relief, if any, to extend to alleviate the members’ financial anxiety.

Emotions arising from using checking accounts/debit cards

Our research also closely examined the role of emotions when using checking accounts/debit cards. Negative experiences using these products can elicit strong negative emotions, including frustration, stress, and anger (see Figure 2).

Figure 2:

Fortunately, we found that fewer consumers whose primary checking accounts/debit cards are from credit unions have negative experiences (26%) than consumers whose primary checking accounts/debit cards are provided by some other kind of financial institution (44%). 

When consumers did have a negative experience, the rise in their negative emotions was accompanied by CX ratings that were 30+ percentage points lower than those of consumers who did not have a negative experience (see Figure 3). 

Figure 3:

Our research revealed four broad categories which captured most of the negative experiences reported by consumers:

1. Customer service.
2. Product functionality (something about the product didn’t work as expected).
3. Fraud.
4. Fees.

Credit unions seeking to reduce the incidence of these negative experiences need to determine the causes of these negative encounters. Once these are identified, credit unions can use member input, such as member interviews or focus groups, to reengineer member journeys in ways that deliver positive emotional experiences.

Emotions play an important role in what members think of your credit union and the experience you deliver. A truly excellent member experience requires following Dale Carnegie’s sage advice: “When dealing with people, remember you are not dealing with creatures of logic, but creatures of emotion.” 

STEVE HEUSUK is senior manager of customer intelligence for CUNA Mutual Group. Contact him at 608-665-7854 or steve.heusuk@cunamutual.com.