Core Deposit Growth Strategy: Part 3

Back to the Future: Data-Driven Credit Union Strategy in Retail Banking

Thriving Post-COVID core depost growth strategy in credit unions

In Part One of our Core Deposit Growth Strategy Series, we explored the financial landscape from 2000 to the present, highlighting the impact of interest rates and the economy on personal and corporate budgets. Part Two delved into key metrics in the credit union industry since 2013, with a focus on the pandemic’s effects and the position that has left credit unions in today.

Finally, in this last installment, we’ll provide specific steps for data-driven credit union strategy to help you attract low-cost deposits in the post-COVID economy.

Embrace Data-Driven Technology for Enhanced Member Service

In today’s competitive financial services industry, technology is a non-negotiable element for delivering exceptional member service and fostering engagement and loyalty. Financial institutions must keep pace with the ever-evolving digital landscape to remain relevant. Additionally, Credit unions should invest in cutting-edge technology to meet member needs and prioritize seamless functionality. Adopting a data-driven approach ensures your credit union can analyze member behavior, anticipate needs, and provide personalized solutions promptly.

Target Generation Z for Low-Cost DepositS

Likewise, the Gen Z demographic represents a significant market opportunity. These digital natives have grown up in financially turbulent times and are accustomed to budgeting. Credit unions can offer financial education and enablement to help this generation reach their financial goals. Therefore, by understanding Gen Z’s unique preferences and needs, your institution can attract them as loyal members and encourage them to utilize low-cost deposit options.

Edwards Federal Credit Union exterior front

Reinvent Branches for Retail Banking Success

Despite predictions of their demise, branches continue to be essential in credit union retail delivery strategies. Branches may be smaller and more service-oriented, but they remain a valuable touchpoint for members, acting as an in-person advisory source for members’ important financial questions. Markedly, credit unions should focus on strategic branch optimization and placement, emphasizing convenience, responsiveness, local decision-making, and outstanding member service. Engaging and knowledgeable branch staff can make a significant difference in member satisfaction and retention.

Compete Intelligently Against National Banks

Credit unions often face competition from large national banks with extensive resources. However, your institution has a unique advantage in their ability to focus locally. Therefore, by concentrating on key markets and leveraging your community connection, availability, and exceptional member service, credit unions can carve out a more personal niche that resonates with their local communities.

In challenging economic times, members seek additional support from their primary financial institutions. To build loyalty and retain members, credit unions and banks must provide an extra touch in personalized financial advice, problem-solving assistance, and guidance on growing their finances.

Create a Strong Market Presence

To stand out in the financial services crowd, your institution can employ a strategic blend of branches, ATMs/ITMs, and billboards to create the impression of widespread coverage. By carefully positioning these elements, credit unions can effectively showcase their presence and attract potential members.

Prioritize Accessibility and Consistency

Members expect easy access to their financial institutions through various channels, including voice, automated response, chat, text, and email. Your credit union must ensure consistent, correct, and timely responses across all these channels. Investing in staff training is crucial to delivering a seamless experience for members, regardless of the interaction method.

Encourage Debit Card Use for Budget-Conscious Members

Promoting the use of debit cards as a convenient way for members to access their funds aligns well with Gen Z’s focus on household budgets. Additionally, offering a connection to an online budgeting tool can further appeal to this segment.

Highlight Local Connections and Member Testimonials

Credit unions should capitalize on their strong local connections, emphasizing factors such as location, community investment and involvement, decision-making, and ownership. By sharing success stories and member testimonials, credit unions can demonstrate the positive impact they have on their members’ financial lives.

Prioritizing Human Assistance in a Digital World

Despite the growing digital landscape, customers still value human expertise when it comes to financial advice and complex transactions. There’s no replacing the power of a personal advisory connection when it comes to building comfort and assurance. Financial institutions must strike the right balance between self-serve options and access to human assistance to cater to diverse customer preferences.

BUILD WITH CONFIDENCE

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Why Member Engagement Matters for Credit Unions and Banks

Active engagement is fundamental to building trust and fostering quality relationships between credit unions and banks and their members. Both entities must recognize the distinction between member experience and member engagement as they play pivotal roles in driving long-term retention and profitable business growth.

Without meaningful member engagement, levels of trust can wane, relationships may weaken, and loyalty could be at risk. By prioritizing member engagement efforts and providing a personalized experience, credit unions and banks can strengthen their position as trusted financial partners, leading to higher member satisfaction, increased loyalty, and sustained success in a competitive market landscape.

This is a distinction that many credit unions and banks are still only beginning to fully contend with. In a survey, we asked credit unions and banks if they currently distinguish a difference between member experience and member engagement, but only a third of institutions (33%) said they currently make this distinction.

Embrace Data-Driven Strategies for Lasting Member Loyalty

As financial institutions navigate the post-COVID economy, a data-driven credit union strategy is vital for attracting low-cost deposits and cementing member loyalty.

By leveraging technology, understanding Gen Z, optimizing branches, and providing exceptional member support, credit unions can thrive in a competitive landscape dominated by large banks. Engaging with members and providing valuable guidance will create lasting relationships, ensuring continued success for credit unions in the financial services industry.

In case you missed them, here are the previous posts in this blog series.

Growing Core Deposits Blog Series Part 1 ➝

Growing Core Deposits Blog Series Part 2 ➝

To achieve the full potential of data-driven growth strategies and solidify your credit union’s position in the market, contact LEVEL5 today. Let us propel you towards a future of unprecedented success.