I heard a great story last week. It was 1934, in Tacoma, Washington. The story begins in a stairwell at City Hall and involves a cigar box.
If you were to start a story with those details and be speaking to someone outside the credit union movement they would probably imagine all kinds of scenarios. But if you’re a credit union junkie, like me, you know where this story is going. It’s the formation of a credit union.
In 1934, my parents had not been born yet. There was no television, internet, microwave ovens, copy machines, email, cell phones, frozen pizza, iPads, bottled water, or air conditioning. There were plenty of banks however. And yet people felt compelled to take their paychecks out of a bank and put it into a cigar box in someone’s desk drawer. Why was that?
Common bond. They knew each other, they trusted each other. It was a simpler time. Money went in the cigar box, and if someone needed to borrow money from the box, a group of their peers (credit committee) would decide if the purpose was provident and for productive purposes. A note was signed and the loan was made. The depositors received a reward (dividend) for trusting the system and have the satisfaction that they helped a co-worker. For decades these common bond credit unions had ZERO competition. We created credit union competitors when we adopted the community charter.
There would be no marketing department in the cigar box credit union for decades. The members were the marketers. The HR department was the ongoing new member drive. The decisions of the credit committee determined the success of the loan promotion. When it was time to formalize out of the cigar box the 1st branch was really the “break room.” Member/owners/co-workers would run the banking errand on their break at their credit union. Positive word-of-mouth was essential for survival.
Fast forward to today – common bond is all but a thing of the past. We have computers that make all the decisions for loan approval in a nano-second. We periodically have “Membership Bribes” to attract new people. We prefer members use the ATM, or online banking rather than come into a branch. There is no common bond. And don’t tell me that “lives, works, worships, in a 12 county area is a common bond.” Oh, and if you have your territory description on your website, please take it down. It’s embarrassing.
Unless your founding story has been tarnished beyond belief (Enron’s Credit Union comes to mind) I think it is our duty to tell it. To preserve it. It’s what makes us unique. It helps to remind us that we are merely the custodians of this history at this point in time.
And here’s your challenge – finding that common bond again. You need to target an audience in that vast territory that you have claimed. Otherwise you will become just another “me too” financial institution marketing with shiny happy people shlepping your 25 bp car loan advantage to people who could care less.
What is your story today? What is your vision for the future? Who will you serve? How will you make the competition irrelevant?
Again.
The 2020 Vision of Marketing 
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September 25, 2013 at 11:36 am
Emma Smalley
I love this article.
Even before I joined my credit union, I came in with my dad. A blue collar factory worker, he joined the credit union, not because it was socially responsible, or a cooperative, but because it was the credit union for his company and his HR person told him to. I remember standing by his side waiting in line and I was amazed that he knew so many people. All the other guys from down at the plant were there and all the tellers behind the counter knew his name. We belonged here. And when I was old enough, and I saved enough to have the $50 deposit for membership, I joined.
Time passed and the credit union grew. The credit union became a community charter. We lost our common bond. Our community feeling. I got a job here. The factory closed. Those familiar tellers left. The members don’t know each other or even what the credit union is for the most part. This really does make me sad. I don’t want to sound like I’m bashing my CU. I love my credit union and they really do their best. But we lost something when we lost our SEGs.
Now, I’m building my own credit union. A new credit union. A community charter, in a low income community chock-full of international flavor. Our common bond is our neighborhood. The community is pretty strong here, so I’m optimistic. While I sit, and plan and write I think about the people that started my credit union 56 years ago. How this place was someone’s dream. Someone stayed up nights working on a charter application after work and had ideas about how the place would run. They had a story too. And my greatest fear is that even if (and by that I mean when) I get this thing off the ground, 50 years from now we will have lost our story, our common bond, our community feeling.
Thanks for writing this reminder to us all.