By Frank J. Diekm
Admit it. You’re kinda lucky. Your credit union has no competition. You own your town and your market and when people need financial services it’s you or—well, you again. Banks? Locals will find those only near the river.
Or at least that seems to be the impression of many credit union marketers and business development execs when it comes to other credit unions.
One of the great honors I’ve had over the years has been to be among the judges in the CUNA Marketing & Business Development Council’s Diamond Awards competition, including the most recent, which were awarded at the group’s annual meeting in Las Vegas. There is a great variety in the work, and as I’ve noted here before there are few better maps for how the credit union landscape has changed and evolved than the entries in the Diamond Awards.
But one place where there isn’t great variety is among the marketing people themselves, each of whom submits entry forms with language describing the local market that seems cut and pasted from the same template. All read something like this: “White Hat Credit Union serves a very competitive market saturated with countless community and national banks and credit unions, as well as national banks. There is incredible competition for our members’ business.”
I’m not sure if all these entrants are under the mistaken impression some (maybe most) CUs just exist in competition-free zones, of if they believe pleading how tough they’ve got it just might score some sympathy points with the judges. Both counts are wrong.
It’s time to get over it and move on. Hey, you’re in marketing—if there wasn’t any competition, credit unions wouldn’t need marketers.
Not For Sale
Todd Clark, CEO of CO-OP, recently shared during the CO-OP Road Show in Tampa that it is frequently approached about being acquired.
“We are a cooperative. Publicly traded companies are always for sale. The only companies are not for sale is us. We have had multiple unsolicited offers and our board has always said no thanks,” he said. “We do not want shareholders who have no involvement in credit unions.”
No, No, No During the Holidays? Pay Attention
Here’s another one of those interesting pieces of insight that might pay off for your CU, as shared during that CO-OP meeting: What’s the best way to identify your truly inactive cards among members? Run the numbers on your card portfolio to find those with no activity during December. If the member isn’t spending on your card during the holidays, they are never going to reach for your plastic unless they’ve tapped out every other card they have. And if that’s the case…
With Friends Like These…
As CUToday.info recently reported here, a new high-rate lender has been given the regulatory OK to begin operating in Ireland, after already having set up shop in the U.K. The company makes loans to people who have been turned down by traditional lenders on amounts up to €5,000 at an annual rate of 49.9%. Borrowers need a guarantor – 35% of guarantors are parents, and 75% are close family.
The name of the company making the loans with the 50% rate: Amigo Loans. Spanish must translate differently in Ireland.
A Final Wish
Should you not have seen it, don’t forget to pay tribute to a CEO who recently died by honoring her last wishes. According to the obituary for Cheryl Merkel, CEO of Central Illinois Credit Union, who had led the $18-million credit union since 1997, “In lieu of other expressions of sympathy, Cheryl’s request is that you spend that money and time with people you love and enjoy, and be ridiculously present with them.”
You can read the full item here.
Borrowing from BoMaD
One of the competitors the marketers referenced above have likely not considered is BoMaD. Unfamiliar with this venerable institution? It was the seventh largest housing lender in the U.S. during 2018, but it’s not a fintech. It’s more of an oldtech, without the tech. BoMaD is the Bank of Mom and Dad, and according to a new analysis, it loaned more than $45 billion to younger buyers to help them purchase homes.
In the new report sponsored by Legal & General Group, it was found that family and friends play a major role in the U.S. housing market, supporting the purchase of $317 billion worth of property across America in 2018. That accounts for 1.2 million homes, with an average sum of $39,000 lent or given, the report said. Were those lenders an actual bank, the BoMaD would be the number-seven lender in the country, the report states.
In all, 20% of homeowners across the U.S. said they received financial help from family and friends when they purchased their current home
A couple of other findings of interest:
- 51% of those who graduated from college debt-free now own a home, whereas 39% do not
- 15% of BoMaD “lenders” have had to accept a lower standard of living to help their loved ones
Frank J. Diekmann is Cooperator in Chief at CUToday.info and can be reached at Frank@CUToday.infoor @FrankCUToday.info.