An ominous statistic emerges as credit unions ponder where future loan and membership growth will come from: Nearly 70% of nonmembers ages 18 to 24 are “not at all familiar” with credit unions—the highest level among any age group, according to CUNA’s 2011-2012 Survey of Potential Members.
The future doesn’t look particularly bright if so few young nonmembers know about credit unions. Clearly, credit unions have a Herculean task in front of them to “move the needle” on awareness.
Members in this age group account for only 9% of all credit union members. Although that’s up from 6% in 2006, according to CUNA’s 2011-2012 National Member Survey, there’s plenty of room for improvement in reaching this group.
Explaining the credit union difference remains a hurdle in building consumers’ awareness of credit unions. That’s reflected in credit unions’ tepid membership growth rate, which slipped from 1.4% in 2009 to 0.7% at year-end 2010—lower than the U.S. population growth of 1%.
Such results are disheartening given the wave of positive publicity credit unions have garnered in the past two years. Numerous media outlets have extolled credit unions as a better option than banks for consumers.
Patrick Adams calls this credit unions’ “bags fly free” moment, referring to Southwest Airlines’ popular branding campaign. During the 2011 CUNA Marketing & Business Development Conference, Adams, president/CEO of $194 million asset St. Louis Community Credit Union, urged credit unions to take advantage of consumers’ anti-bank sentiments.
It appears his advice has fallen largely on deaf ears, as only 33% of nonmembers are “very” or “somewhat” familiar with the services and benefits credit unions provide. And among young adult nonmembers, that drops to an anemic 3%.
Still, some credit unions are bucking the trend and achieving solid membership growth, even with tightly stretched marketing budgets.
Also, several credit union leagues or associations have created campaigns to boost awareness of credit unions in their states, such as:
In February 2011, CUNA and several state leagues unveiled a new Web-based tool—aSmarterChoice.org—that helps consumers find credit unions to join and focuses on consumers’ needs, not credit union jargon.
The top five items nonmembers say they’d need to begin using credit union services are:
Among 18- to 24-year-olds, the top factors in selecting a primary financial institution are:
Next: Aiming for growth