Loyal members—the Holy Grail for CU marketers—drive profitability.
July 29, 2013
Likely to recommend
Another important variable for measuring loyalty is members’ “likelihood to recommend” their credit union to others. Overall, 57% of members are “extremely likely” to recommend their credit union to others (“Most members—except the youngest— are ‘extremely likely’ to recommend CUs”). Only 40% of members who also use banks say they’re “extremely likely” to recommend their banks.
Almost all credit union members who also use banks are more likely to recommend their credit unions than their banks. The one exception, however, is among members ages 18 to 24. They are the only age group equally likely to recommend their credit unions as they are to recommend their banks (31% would recommend credit unions; 32% would recommend banks). The widest gap is among members ages 45 to 54; 63% would recommend credit unions but only 39% would recommend banks.
“Younger members might not have a strong allegiance one way or the other because they simply haven’t had enough dealings with their banks or their credit unions to form strong opinions either way,” suggests Haller.
Another factor, says Haller, could be that some banks have strong relationships with major colleges and universities. They oft en have high visibility on college campuses and offer co-branded credit and debit cards to students.
“It might be a matter of who gets to young consumers first,” Haller says. “Banks’ presence on college campuses puts them in the right place at the right time.”
But, Haller continues, it’s not just about having a presence on college campuses. “Banks are probably less conservative than credit unions in granting credit cards to college students,” he says. “College students want easy credit, but they’re oft en not prepared to handle it, and they run up balances they can’t afford. Credit unions are more focused on financial education and teaching students how to use credit wisely.”
Likely to contact CU
Another variable in gauging loyalty levels is members’ likelihood of contacting their credit union the next time they need financial products or services. When members were asked whether or not they would contact their credit union for their next financial need:
• 50% said definitely;
• 34%, probably;
• 8%, probably not; and
• 1% were undecided.
Members ages 25 to 64 are somewhat more likely than the youngest (ages 18 to 24) or oldest (ages 65 or older) to say they definitely would turn to their credit unions for their next financial services need.