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Food: Your Credit Union’s Newest Product?

Originally published on CUInsight.

Digital transformation. Post-COVID planning. Loan growth strategies. Generational marketing.

Those are all important topics. You’ve got plenty of resources for each.

But this article? It’s going to talk about something I guarantee is 100% new to you.

In fact, consider this the first time it has EVER been discussed within the credit union world.

Food. Yes, food. And your credit union. Along with members and your larger community. If this sounds crazy, you’re right. It’s also a peek into what could become a $1 Trillion industry. That’s a T, for trillion, in case it didn’t register the first time through.

It’s ok, you’re wondering where this is going, and how it could possibly connect to your credit union. I promise I’ll get there. First, let me introduce this concept, which, by the way, your Gen Z and Millennial relatives already use (whether they realize it or not).

The Delivery Shift

Pizza Boxes
Not just pizza.

You know the basics of a restaurant, even if you haven’t been inside one in a while. There’s a building with seating areas, perhaps a bar, and a kitchen in “the back”. When you order from a waiter or that Ziosk device on your table, a ticket goes into the kitchen to prepare your food.

A short time later, you’ve got a piping-hot meal, fresh from no more than 50 feet away. It’s just as delicious as you remember, which is why you came back to this particular restaurant. The food is consistent and you trust their brand to deliver, even if you visit another location.

Of course, once the pandemic struck, we turned to take out and delivery. The food delivery segment surged 164% in 2020. Like other things, COVID accelerated transformation. Yet it was already on this track. Delivery has grown 300% faster than dine in over the past 5 years.

And most people hungry at home just opened up Yelp to call their favorite restaurant, right? Nope, they downloaded:

  • GrubHub (which acquired Seamless and Eat24)
  • Uber Eats
  • Postmates (which Uber acquired)
  • DoorDash (which had a huge 2020 IPO)
  • Drizly (for alcohol, another service Uber acquired)

If you’ve been on these apps before, you know how simple they make getting food to your front door. They’re also surprisingly good at making “what you want” as important as “where it’s from”. When you’ve got a burrito craving, it makes sense to filter by fillings rather than source.

Ordering food for most now means opening a delivery app and not a specific restaurant’s site. If this concept sounds silly to you, rest assured, you’re currently not their target audience. But you might be after finishing this article.

Because that list of nearby restaurants and food items showing in Uber Eats has a secret: Some of those restaurants don’t exist.

Ghost Kitchens

Cooks in Kitchen
Look at those apparitions cook away.

No, this isn’t some Halloween Horror Nights event. A ghost kitchen is simply “a cooking facility that produces food only for delivery with no dine-in or customer facing areas.” You may recall commissary kitchens, where you can “set up shop” in a fully-prepped cooking space.

Ghost kitchens are similar, except they can also be part of another, already operating, restaurant. Say you own a taco stand and want to bring in a bit more revenue. You could consider preparing pizzas under a different, delivery-only, brand.

Many places are doing this now, especially as dine-in activity collapsed throughout 2020.

However, this isn’t a new concept. There are currently 1,500 ghost kitchens in America. Globally, it’s caught on to a larger degree, with over 7,500 in China and 3,500 in India. As mentioned earlier, projections put it at a $1 trillion industry in less than a decade.

How do you promote a menu which has no physical location to visit? Even food trucks stop to sell their goods! Delivery apps. When scrolling on your phone, it doesn’t matter if the “restaurant” has a location, just that they can deliver your wet burrito in 32 minutes.

Ok, so we recognize the enormous growth in food delivery apps, the expansion of ghost kitchens, and how seamlessly they fit together. Where, you are probably thinking, is the credit union connection?

Enjoy your side of guac and chips as we prepare the main course.

Ghost Franchises

Girl on Phone with Coffee
She’s definitely using a delivery app.

Here’s where it gets interesting.

Say you’re a YouTube celebrity with millions of followers (this is absolutely a thing), and you want to promote a new way to monetize your audience. Product placement and paid promotions are fine, but they’re old-school. You want something fun. Something tasty.

What if you could open a national restaurant chain with items fully to your branding, and you’d earn a piece of every food sale? Oh, and you wanted to do it with minimal investment. Sounds crazy, right?

Not anymore. Today, you’d work with a ghost kitchen consultant to set up a ghost franchise. Together, you come up with the restaurant name, its food items, and on-brand descriptions and graphics. Then, you food test and create standardized recipes. Finally, distribution.

Your consultant helps recruit a regional or national network (depending on your goals) of restaurants and ghost kitchens willing to make your food. These are often large chains, so one agreement can bring in hundreds of locations. And, there is no step 3.

You’re A (Delivery) Restaurateur

Uber Eats Bike Delivery Man
Fresh from…where again?

In that entire footprint, your “restaurant chain” goes live in delivery apps. Overnight, your fans can order your burger in 95% of metro areas, sharing their response videos about it the next day. And everyone using their existing apps sees a “new restaurant” in their area.

This isn’t a hypothetical. MrBeast, a YouTube star with over 50 million followers, opened MrBeast Burger in just this fashion. He’s not alone. Celebrities as wide-ranging as existing restaurant owners to reality stars follow this model.

Guy Fieri has 130 regions where you can take the virtual drive to Flavortown Kitchen. Mariah Carey (yes, that one) has a whole line of cookies available in 39 states. For the Jersey Shore fans, you can chew on Pauly D’s Italian Subs.

With a bit of planning, anyone can launch a food brand. And, since it’s fully virtual, you can evolve it as needed. So what if you wanted to do more than just fill stomachs? Is it possible for this model to improve communities?

The Credit Union Food Connection

Breakfast on Table
Breakfast from your favorite credit union!

Bank, borrow…bite? Eating isn’t often associated with your financial institution. Unless it’s a lunch-and-learn session or department pizza party (remember those?), business revolves around dollars and members, not dining.

The community and member-facing side of your credit union exudes financial empowerment. You aim to lift people up through your products and services, and don’t need me to explain that aspect of your mission. But what’s a major challenge? Communicating this effort to the public.

What if your credit union started a restaurant? Backed by ghost kitchens, you could build a brand that connects back to your own, raising awareness and excitement for your initiative.

Sidenote: Yes, there are possible challenges related to operating a “business” as a credit union. In my mind, this would necessitate setting up a CUSO to handle it. You’d start as fully non-profit, where all revenues go to your charity partners. Eventually, it could support the CUSO, which can handle multiple CUs.

The menu items could have names relating to savings or financial goals. Descriptions could include witty connections to local charities and member success stories. If this sounds unfeasible, you haven’t let your marketing team run wild.

An Order of Community Improvement with a Side of Financial Education

Menu Clipboard with Food
What’s your daily special?

By using the ghost franchise model, you could open an app-visible restaurant chain across your entire member footprint. Besides traffic from regular users of delivery apps, you would promote it through your social media and website (especially mobile banking…engage them on the same device!).

Sure beats another message about how your rates are the lowest in town. Or that a HELOC with your credit union is a great decision. I guarantee your members are not expecting to hear about daily specials…of food! Start your order now!

With items advancing financial literacy and the whole model promoting your brand, what else could you do for the community? Remember the references to local charities (or your foundation efforts)? They can be more than just mentions. Think real giving.

Your model can accommodate a portion of sales to support these charities. Share quarterly updates with members about how their eating habits made a real difference. Tell them how many backpacks you got for underprivileged kids, or how many meals they helped you serve at a local food bank.

Most importantly, ensure your members feel part of the effort. Thank them for supporting the community with every order. Tell them exactly what their order provided for a partnered charity.

Remember all those discussions about how Millennials and Gen Z like (and tell friends about) companies who are genuine in their mission? Show them on their turf.

Food: The Next Credit Union Frontier?

Cake Pops
“You see, the sprinkles are like interest…”

Every day, you read articles warning that without innovation, your credit union will struggle to succeed. Normally, they suggest advancing your digital transformation, and some promote their own products. Yet all of them reinforce your role as a banking establishment.

What if you could blur what your community thinks it means to be a credit union? Sure, you provide tools to advance financial literacy and empowerment. But you also have a killer loaded potato, stuffed with informative nuggets about building a savings strategy and the knowledge you’re helping support those less fortunate.

Who’s hungry for some real change?

Want Your Marketing to Connect? Ask the Women!

For decades, the question was, “how do we market to the younger generations?” In the 90s, it was Gen X. 2000s? New Gen Ys look like they will want everything different. In fact, they’re so different, we can’t even use the same naming scheme.

We’ll call them Millennials. Yes, that feels good. Because they’re unique. And lived through the dastardly Y2K. #ISurvivedY2K

Turns out, Millennials were different. We grew up amidst both massive growth and enormous economic failures. Basically, there’s a lot working against us. I definitely don’t have time to go through them all.

And that’s fine, because there’s a new generation.

Gen Z. Ooooh. Young and spunky, but jaded like no other. For some reason, with these guys, we’re fine resuming the old naming convention. Finish the alphabet strong, right?

What makes Gen Z stand out? I yeet that question. Forget Millennials “destroying industries”…this generation will finish them all.

Connecting with Generations

There’s truth to every one of these analyses. People of different generations do exhibit unique qualities. And what engages a Gen X may not interest a Gen Z. Not to mention you can’t use the same platforms, because they’re just not there.

Yet this is all missing a bigger point. It’s about the generations, sure, but it’s about something even more basic. It’s about clarity, transparency, openness, warmth. I’m talking marketing to men and marketing to women.

Women Make Money Decisions

Ever wonder why home improvement marketing targets those handy men (and some women), yet home buying targets couples? It’s not only because, “this is a big decision we should make together.” It’s because the latter gets it. They know the women overwhelmingly make the purchasing decisions.

Young Couple with Dog

It’s not just me saying it. Women make the vast majority of purchasing decisions, no matter who works (or if it’s a multiple income household). In every marketing aspect, the biggest differentiator is gender.

So if women make the decisions, no matter their age, why are we putting so much focus on the generational trends? Look, I’m guilty of it as well, though my advice tended to be, “connect where and how people are, in an honest and transparent way.”

Let’s look at a recent rebrand from a company you may recognize (Disclosure: My company works with them).

TrueCar: A “Radikal” Rebrand

TrueCar doesn’t sell cars. However, they are the top rated site for people to find and get a guaranteed price on a nearby car. So they’re a big part of the car-buying process.

And, frankly, car buying sucks. Unless you’re buying a Tesla, you have the whole dealer thing to navigate. I’ve bought Mazdas for many years, from the same dealer and salesperson, and still, I don’t like the system.

Let’s be honest. Have you, or someone you knew, ever said, “by golly, I’m just super stoked about my car dealer! They’re the real cat’s meow!” That’s how people talk, right? Sounds fine to me.

The team at TrueCar hadn’t heard those comments, either. Yet their business depends on people going through that process. How do you encourage more people to do something we all know is, at best, meh?

They focused on the buyer. The real buyer. Women.

What do they want? Like the generation question, they want the same thing: Openness, clarity, honesty, warmth, connection. Every design and process change TrueCar made aims to achieve those ends.

Woman on Laptop

In their surveys, the new design language out-tested every other brand in likability by women. They’re featured in the animations, because apparently TrueCar also has this strange perception that women…exist.

So do you design for women only and exclude everyone else? I mean, you could, and you’d probably be fine, as long as you avoid “For Her” Bic pens (Definitely check out the “reviews”). It’s not like they’re half the population or anything.

I’m a guy and I love the new design. The old one wasn’t bad, but it also wasn’t anything special. It told what they did in a traditional “trust-building and calming” blue tone. True was bold and caps because it is about being true to all parties.

The new one keeps that messaging and makes it about you. Because buying a car is personal. And that the decision-process can be fun…especially if it’s easy to do.

Doesn’t that make you want to at least look for a new car?

Generational Marketing is So Last Generation

So we’re done with generational marketing? Yes. And no. Because generational understanding still gives you valuable insights. It’s just not the complete story.

For example, a Boomer is less likely to be on Snapchat. So if you’re trying to promote products that fit their needs, it’s a silly place to market. Use age-specific demographics and include in your social strategy.

On the other side, a piece of education or product that works for a range of ages should be tailored to women. Because that’s your common factor. 25 and 65-year old women both fit a demographic.

Woman at Dual-Screen Computer

And why tailor to women rather than men? Because, once again, women make the buying decisions. Convincing men a certain razor is better might make them buy it.

More likely, the marketing will inspire them to ask their wife to buy it (or she’ll notice and get it on her own). And we’re not even talking about same-sex or cohabitation living arrangements.

Marketing At Your Credit Union

How does this relate to your credit union’s marketing and outreach strategies? It means going back to your mission. Again.

Take a look at your About Us or Why We Exist page. What does it present?

Circle of Hands and Feet

Most likely, it teaches you about a destination that people trust and rely upon for:

  • Sound financial advice
  • Tools to help simplify a variety of life stages
  • Efforts to boost the economic well-being of members

That sure sounds like stuff you’d want to present to the financial decision-maker of a household. Which means, your message is already solid. The change needs to come in how you convey it.

Take a look at what TrueCar did. Then look at Airbnb. Even Bank of America. What do they all have in common? Authenticity. Personality. Experience.

You don’t have to do a full rebrand to reap the benefits of this focus. Of course, when you do that, make sure it resonates!

Your goal, as you’ve read from me for years, is what it’s always been: Aim to best fulfill your mission. And communicating that in a way others grasp is a win for everyone.

So, women, what do you want? Because that’s your best marketing question to ask now.

This ICU Day, Let’s Aim for Engagement!

I’m a huge fan of the credit union mission and all it contributes to our communities. You’d know that if you’ve read more than a few lines of any previous post. Of course, you’d also know that I’m not afraid to call out things when they could be improved.

On that note, I have just a few suggestions for this year’s International Credit Union Day campaign. In case you weren’t aware, the theme is, “Find Your Platinum Lining” (at a credit union). Because it’s the 70th anniversary of the event. And 70 means platinum. You knew that, right? I didn’t. Honestly, I thought it was for 75. Turns out that’s diamond (jewelry, to be precise). In fact, all I could find about the 70th anniversary linked it to UK tradition. Thus, Americans will have limited exposure to this “platinum year”. I’d be curious how many people under the age of 70 even make the connection. I asked some people of a variety of ages; none knew that Platinum and 70 went together.

Which raises another point: If our goal is to attract younger members, why use a terminology which they are unlikely to understand or relate? Of course, we’re not only looking to attract younger people, but, let’s be honest, they’re who you want. More Boomers are great, but a member with 50 years of major purchases and life changes ahead of them is substantially more valuable.

Slogan aside, let’s take a look at the unified messaging of the credit union movement (at least here in America). Their newest endeavor is “Open Your Eyes” (to a credit union). It’s a major investment with substantial marketing targeting, ahem, eyesnationwide, from TV to streaming services and even subway banners. Yet it isn’t connected to this ICU Day effort at all. Perhaps it’s not quite ready, because this seems like a missed opportunity.

Another point relating to the Open Your Eyes campaign; a major part was to study what people’s actual reasons for not joining a credit union really were. Turns out, it was two main points:

  1. Thinking you had to be part of a certain company or group.
  2. Concern that you had to leave if you moved, or risk not being able to access your money.

Those are valid concerns which we need to address as an industry. So does the ICU Day campaign do that? Not quite. It reiterates the tired, “we’re different and unique” platform. Great, you give back to your members. You have low rates. Some of the larger banks are already playing the same game. And, frankly, they’re better at it. Capital One just launched a new effort featuring their friendlier branches (“Cafés”), free checking, and other customer-centric offerings, while separating themselves from the “Big Banks”. Never mind they are one; their marketing presents them otherwise. And it is reallygood. Ally takes a similar approach, setting themselves apart from the “Big Bankers” who don’t care about you while making billions off your money.

More than a third of Americans are members of credit unions. Yet they have only 7% market share. That’s an enormous gap. And it won’t be solved by saying how low your rates are or that you give back. It’s providing reassurance that people can join, money can be accessed anywhere, and then empowering each CU to go deep on mission.

The big banks are better at differentiating themselves from “The Big Banks” than credit unions. This ICU Day, let’s open peoples’ eyes to credit unions by showing how they make each community better. And how, if you join (because you can!), you can both reap the benefits and help inspire growth as well.

That’s a platinum lining everyone can enjoy!

Happy International Credit Union Day!

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