Credit Union Geek

Marketing, Strategy, and The Force by Joe Winn

Tag: member choice

“A Credit Union Member Walks Into A Car Dealership…” (Part 2)

This is a continuation of “Unseen Credit Union Competition“. Last time, you saw what members receive after buying a car or home. Now, we rewind to the buying process itself.

Car Dealers & Credit Unions: A Necessary Alliance

In my business, I work with a wide variety of credit unions. Small to large, urban and rural, with everything in-between. What do they all share? A relationship with local auto dealers.

The degree of this arrangement varies from:

“We send to you, you send to us.”

to

“The dealer holds all the cards and we do what they ask.”

Depending on whether the credit union engages in indirect lending or even cares about direct (and if you’re reading this, I bet you do) says a lot about where they fall on that scale.

Your Members Just Want a Car

Forest Road Speed Blur

Let’s be real. Your members don’t care about back-end relationships. Remember, their focus is on the car. A low loan rate, convenience in application, and speed of closing are what they want.

Why? Because that means car shopping can end faster and car driving can start sooner.

Take a quick poll of your office or members in the lobby right now. Ask them who loves the car buying process. Did any respond like this?

“Yes, we get to do it again! I can’t wait!”

It’s exciting to get a new car. Buying one, though? Not what most would call “fun”. As their credit union, you can help members save time, money, and potential future frustration.

Dealers Sell

The first part of this series, Unseen Credit Union Competition, looked at the slimy tactics of aftermarket firms aiming to sell your members (and anyone who buys a car or home) questionable protection products.

It’s important you make members aware of these efforts. Not only is it the right thing to do, but if something goes wrong, where do you think they’ll go to complain?

Shopping Cart
My car’s dealership had a little shopping cart on the F&I desk.

Auto dealers don’t get involved in this stuff. They simply present their product offerings at time of purchase. Of course, some of this overlaps with your own lineup. But theirs is obviously better, since it’s connected to the manufacturer…or something.

What? It’s not? Oh, and it’s often the same thing you offer, just more expensive?

Given that knowledge, I’m sure your team makes a point to explain this to every member, right?

Of course, maintaining a strong relationship with your local dealers is important. Frustrate them and they’ll stop accepting your drafts, inconvenience your members, and not send indirect loans your way.

Some might even complain to customers about your apparent unwillingness to pay them! (I’ve heard this happen more than once)

You’re in this together; surely, this town is big enough for the both of us!

Equip Members With Great Info

Your mission is to serve your members. And that means arming them with helpful information before they walk in to the dealership. What does that look like?

Lay out what you can offer a member buying a car. Here are some common possibilities:

Clipboard Checklist with Pen
  • Loan (duh)
  • Simplified search and shopping process (By referring to your car buying service)
  • Preferred and/or upfront pricing (Through a dealer group arrangement or car buying service)
  • Rate discount (Combination of services, auto-pay, promotion with partner platform, etc.)
  • Fast and accessible-anywhere application, approval, and funding process
  • GAP
  • VSC
  • Depreciation Protection Coverage
  • Debt Cancellation Insurance
  • Credit Life/Disability Insurance

Anything else? Yes, this is me asking you. Because who knows your credit union best? Hint, it’s not me.

Now we have a detailed list of everything your credit union can provide a member looking for a car. This is your “value proposition”. Look back again. These are the reasons why you are in the auto lending market.

Do each of those items feel like the best possible options for your members? If not, it’s time to re-evaluate. (Disclosure: My company’s Learning Library is full of unbiased info to help!)

Pizza Closeup

Here’s a tasty thought exercise: Assuming both are equally accessible in every way, would you eat at the best pizza place in town, or the 2nd best?

To ensure continued survival and growth, you have to be the best choice for members.

For brevity and with respect for your time, I’m splitting this post into two parts. What did we learn today?

  1. Credit unions and car dealers must work together for the benefit of members
  2. Your members don’t care about what happens in the background. They want a car. Easily.
  3. Dealers offer a lot of the same products as your credit union for a lot more money. Ensuring your members know you can help at a lower cost (assuming the programs are otherwise equal) is essential for your growth.
  4. There’s a Learning Library with a lot of helpful resources for your due diligence (shameless plug!)

Even More Bad Advice – Part 2

Originally published on CUInsight.com

If you thought the last post was awful, this one is worse. We’re back to giving bad advice. This time, we’re talking choices, external link warnings, and, because it’s my top pet-peeve, passwords again!

More Options Is Always Better

“Enjoy checking…with choice! Find the account which matches your needs from our 5 different plans. They’re basically all the same, besides a 0.01% dividend. But who cares…options are essential!”

I get the concept: By creating a solution for every possible need, you can appeal to any potential member. Thus, your membership potential isn’t any one category, it’s humans (and sometimes even that is stretched…why can’t your dog share in savings?). Now that I’m thinking about it, a savings account for your pets is pretty cool. You could put away for their essentials, vet bills, unexpected challenges, and more. It’s like a savings goal, but separated in a fun way. Ok, that one is excluded.

Where was I? Oh, yes, choices. My business works primarily with the auto lending side of credit unions. In it, there is one main goal: Encourage the member to get pre-approved. However, people look for a car before a loan (unless they have no clue what they can afford/finance). As a result, many credit unions set up car-buying resources. They include calculators, lengthy PDF guides, and external company links. In many cases, they’re not even affiliated with those outside links! (Keep this in mind, it comes up later) What are you doing? Keep it simple! One link to do the fun “build/find a car” with a partner program (Disclosure: My company offers exactly this) and another to get pre-approved. Those outside company links? They often have their own financing programs. Bye bye loan (or ever knowing that member is looking to buy a car).

You may have heard of the “Paradox of Choice”. Give someone too many options and they’ll never make any decision. In fact, new research shows that this isn’t 100% true (science doubts itself always, boys and girls). What they found was that better options are better. More options for the sake of options makes people do one of two things: 1) Never decide and do nothing or 2) Decide based on meaningless factors (possibly because the important ones are hard to understand or not immediately obvious). If you must offer options, make sure they are equally good and clearly different.

External Link Warnings Keep Members Safe

A vestige of the World Wide Web’s “dark ages”, these are pop-up messages telling the browser that they are now leaving so-and-so’s website, and they cannot guarantee their safety, security, or that delivery will be in 30 minutes or less. You don’t need them. Many credit union legal teams claim they are mandated, but the only reference I’ve ever uncovered is a non-binding NCUA guidance from 2003. That’s Pi, or pre-iPhone. Weather widgets, local news scrollers, and other useless distractions were commonplace on most websites. Sure, if someone was clicking from their online banking to see what the latest news is in Anytown, USA, yeah, I’d want to ensure it was clear that site isn’t us.

You’ve learned a lot since then.

And if you’re that worried about where you are sending members, why send them there? (Remember the post Trusted Partners!) I’ve seen external link warnings on links to NCUA, loan applications, and more. You have legally-binding agreements with these partners or providers! It gives me the feeling these credit unions just said, “The world is a scary place. Let’s terrify our members, too. Oh, and make sure they never use our products.”

Alright, your legal team insists the warnings are necessary. Can’t argue. Just make them friendlier! Instead of a long text field in legalese, create a bright-colored, concise text notice. “Hey, just so you know, this link goes to someone we work with. They’re great, but we have to let you know they might have different policies on privacy than us. Click here to continue or just wait 5 seconds and we’ll get you on your way!”  Here’s an example from a client (name redacted). It’s still a bit long for my taste, but isn’t scary if you read it:

Simple, friendly, and still accurate. Always remember your mission. You’re people serving people. The second you adopt the terminology people associate with “big banks”, you’re no different.

So, instead of slapping warnings on every link, be diligent in working with people and companies who truly share your mission. Then you don’t need to warn anyone about anything. And, if it’s essential, be nice about it.

Passwords With Symbols Are Most Secure

We covered this in passing last time. But since the focus was on changing passwords, I want to cover this independently. Your password doesn’t need to go to the gym. And no, your password doesn’t even lift, bro.

Password strength is determined by how hard it is for a computer to figure it out, strictly by guessing. And you know the easiest way to make it really hard? Length. Not symbols. Not using aLterNatinG cases. Not replacing 13tt3rs with numbers. Sheer length. Here’s that amazing xkcd comic to explain why, once again.

If my password was “GoshIneverrememberpasswordsnomatterwhattheyare”, I can guarantee you, no computer in existence today will ever crack it. Yet you’ve already memorized it.

Many recent password leaks have had passwords figured out because the security they used was garbage. I can’t help you there. Insist their system gets an outside security audit regularly, and, if they’re responsive, ask if they’re using salted password hashes. If they aren’t, don’t give them your information.

With good security and strong passwords (ie. long ones), you can enjoy the convenience of online services with little worry of your information being compromised.

I never want to see those, “Your password must include 6 symbols, 2 emoji, 3 different cases, and one name of your favorite pet” prompts again!

And that’s just a bit more bad advice.

Image credit: ArsTechnica, http://cdn.arstechnica.net/wp-content/uploads/2013/05/correcthorsebatterystaple.jpg

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