Trust is a complex and critical attribute of all relationships. So how can credit unions deliver their products and services in a way that inspires member trust?
Insight Vault caught up with CO-OP Financial Services Chief Marketing and Experience Officer Samantha Smyth Paxson and Coastal Credit Union’s vice president of marketing and product development, Brandon McAdams, for answers.
I.V.: A positive digital experience equates to trust. How can credit unions ensure that digital touchpoints meet members’ expectations?
S.S.P.: Organizations earn trust by demonstrating credibility. Credit unions need to embrace a digital mindset and deliver in a digital-first way. That equates to credibility.
B.M.: To understand what members expect today, just look at Uber. Everyone raves about the interface and how it allows you to get from Point A to Point B easier. But the app isn’t just flash. Its main function is to provide transparency – you know where the car is and how much it will cost, and you can preload your destination so there’s no confusion.
S.S.P.: There is a ton of research out there that shows this is the kind of experience consumers want, which is why the popularity of Google, Amazon, Facebook and Apple continues to skyrocket. There are indicators that these companies will begin to offer banking services – and they could be very successful at it because consumers actually trust them more than banks. According to the Financial Brand, 46 percent of banking, insurance and wealth management customers surveyed by Accenture would switch to a tech giant if given the chance.
I.V.: Consumers trust brands that add value to their lives. How can credit unions enhance their value proposition?
B.M.: The best way to add value is to simplify processes. Members don’t want to think about finances, and they don’t want to worry about them; they want to save time. In fact, saving time is so important to consumers today, they will pay a premium for the privilege. Take Rocket Mortgage. Their rates are frequently the highest in the market, but a lot of people are willing to pay them because they see value in a quick, seamless process.
S.S.P.: What credit unions need to do first is break down how the member engages with them and understand what is valuable to them with each interaction. Then they can apply data and digital accessibility to solve problems for members in ways that are fast and frictionless. Data is the new currency.
I.V.: Making the user journey smarter and more rewarding promotes trust. How can credit unions achieve this?
S.S.P.: This is another area where Silicon Valley shines. Tech giants flow into a consumer’s life like electricity – like air. They exist and everyone is already breathing them in. Credit unions need to create branches and digital experiences that can compete head on with the likes of Apple.
B.M.: To maintain their edge, credit unions should also play to their strengths – each other. Credit unions succeed when they band together. Just look at the success of CO-OP shared branching and how it has made banking so much more convenient for members.
I.V.: Reducing friction and stress builds trust. How can credit unions alleviate member stress?
B.M.: First, credit unions need to realize that most people have no clue what to do with their finances, and the last thing they need is more complexity in their lives. Credit unions need to communicate well with members, be especially clear about their fees, and be prudent in charging them. At Coastal, our internal systems automatically cap overdraft fees at two per day, and we drop our fee to one penny per transaction if the account is brought out of the negative that day. These fees can add up and are a sticking point with consumers.
S.S.P.: Complicated workflows cause stress. If members have to go to seven different portals to put their financial picture together – or worse, their card gets declined and they can’t figure out why, what does that tell them about their financial institution?
I.V.: Consumers trust organizations that predict and address their needs. How can credit unions better anticipate member needs?
S.S.P.: It all goes back to data. Credit unions should rely on their data to understand what members need at every point of engagement. They need to walk in their members’ shoes and think about how they pay bills, understand their cash flow, and work to pay off student loans and credit cards. Then they need to improve these processes.
B.M.: When members interact with us, remember that they are not as focused on us as we are. They are not willing to embrace a product just because it comes from a credit union, especially if it takes too much effort. They will do a Google search, find Rocket Mortgage and apply – rather than wait on hold for a half an hour.
S.S.P.: Credit unions still have an advantage because they share the values of members, and members recognize this. But they need to continue to nurture member trust. In a relationship economy, that’s what it is all about.
Hear more from Samantha and credit union innovators like Brandon at CO-OP’s THINK 18 conference, to be held next May at the spectacular Sheraton Grand at Wild Horse Pass, Chandler, AZ.