Check Your Blindspots

reflection of winding forest road in side mirror of car
Bryn C. Conway, MBA, CUDE Photo
BC Consulting LLC

7 minutes

Use the lessons of the pandemic to drive your member experience and marketing strategies for 2021 and beyond.

My Dad would often say, “When you are looking in the rearview mirror, you see everything with 2020 vision.” Little did I know how prophetic his words would be for the year we’ve just experienced!  

Consumer attitudes and behaviors have varied greatly throughout the pandemic. It’s important to understand that what worked for our marketing and member experience efforts before and during the height of the crisis may not be relevant for what’s next. It’s not as simple as adjusting to the “new normal” or getting back to business as usual. Instead, we’re experiencing a slow, evolutionary change that requires a measured yet thoughtful approach. 

As we put the pandemic in the rearview mirror, we should set our sights on what’s in front of us, tap into how consumers are feeling and behaving now, and use what we’ve learned to retool our member experience and marketing.

Short-Term Optimism, Long-Term Worry

As we head into the second half of 2021, things seem to be looking up. This renewed sense of optimism is reflected in how almost half of Americans are feeling about their finances. A Chase and Morning study found that 48% of U.S. consumers polled felt that their financial condition will improve over the next year, with 65% believing that they are in good financial health. 

Many consumers buckled down during the pandemic and focused on prudent financial behaviors. For example, a full 30% of respondents in the Chase study said they used their stimulus checks to pay down debt, 36% used those payments to boost savings, and 32% said they had set a goal to develop and maintain a budget. Perhaps even more impressive is that a CivicScience study reported that almost half of Americans (46%) paid off all their credit card debt over the last year. 

However, as Americans look at their finances in the long term, their anxiety and worries begin to mount. The CivicScience study found that four out of five consumers worry about jobs and the economy long term. According to the Pew Research Center, 44% of Americans who are not retired worried that the economic aftermath of the pandemic would make it difficult for them to meet their financial goals, saying it would take them three years to get back to where they were pre-pandemic. Pew also reported that 29% of consumers worried almost daily about their ability to save for retirement.  

Members are worried about the future, so it’ll be important to convey that you’re working diligently to meet their needs, are in tune with their concerns and are here every step of the way. 

From a member experience standpoint, do this by taking the extra time in your interactions to provide a consultative approach and offer quality advice. It’s not likely that you’ll have another sweeping opportunity to reconnect with your members. In your next interaction, ask how they fared through the pandemic, about their short-term and long-term goals and how you can help. 

Take this advisory and consultative approach into your marketing as well. Position your credit union as ready, willing and able to help your members today, tomorrow and far into their financial futures.

Bryn C. Conway, MBA, CUDE
BC Consulting LLC
In a consumer survey from EY, 20% of the respondents expect to be using less cash and increase their use of contactless payments over the next couple of years.

Is Digital Banking Really the New Normal? 

A year ago many of us, me included, predicted that the pandemic would lead to a greater adoption of digital banking­—and perhaps finally get those staunch non-adopters to ditch transacting in person. 

This absolutely happened at the onset of the pandemic as consumers had no other choice, with branches closed and the drive-thru sporting lines around the block. In fact, the EY Consumer Future Index found that 43% of respondents reported last year that their banking habits had changed because of COVID-19.

Fast forward to spring of 2021, and, with mask mandates lifted, the drive to digital seems to be lessening. The same EY study reported that just 16% of respondents stated that the way they bank will change over the long term because of the pandemic, with only 24% expecting their financial institution to operate more digitally in the next 12 to 24 months. It seems that people like what they like, and that as things open up, members will revert to some of their preferred ways of doing business. 

The lesson learned from this is that the move to digital is evolutionary, not revolutionary. It’s incremental, and we should not expect that our members would go from doing none of their banking digitally to doing all of it digitally simply due to the disruption. 

Take advantage of the opportunity that many members who never did anything digitally have now had that experience and see if you can get at least a few of those behaviors to stick. If members started paying bills digitally, using mobile deposit or transferring funds with digital banking, encourage that behavior. Use your marketing to help raise awareness of the features and benefits of digital banking. 

As for the member experience, keep improving your platforms. Make it easier to join online, fill out a loan application, sign documents and make an appointment. Showcase that you are focusing on the member experience and providing flexibility as well as options for how members can bank digitally.

Payments Surge: The End is Near for Cash 

Paying with cash has been on the decline for some time as digital payments have continued to increase in adoption. COVID-19 sped up the trajectories for both. According to the EY study, the use of cash by consumers during the pandemic fell by 57% while other kinds of payments rose. Credit card usage increased 7%, debit cards 10%, and online payment tools, such as PayPal and Venmo, 14%. When people were purchasing in person, contactless payments were the preferred method, seeing a 34% increase. Most telling about the decline of cash is that 20% of the respondents expect to be using less cash and increase their use of contactless payments over the next couple of years.

Another movement in payments is the re-emergence of installment payments or buy-now-pay-later options. CUES Supplier member FIS, Jacksonville, Florida, predicts “buy now, pay later” in the U.S. will make up 5% of transactions by 2024, up from its current 2% market share. The rise of the installment payment option is popular in the younger generations but is also a reflection of consumers focusing on reducing their debt during the pandemic. A study by the Center for Generational Kinetics found that 50% of Gen Z, 62% of millennials and 59% of Gen X say that when they are presented with a buy-now-pay-later option, they will either definitely or likely use it. Buy now, pay later is viewed as an alternative to credit cards, with 36% of respondents saying it would help them budget better and a third saying it would give them more control. Moreover, 31% think they would have more financial freedom by using installment payments.  

Offering members options, flexibility and focusing on their desire to control their finances and their cards should be your focus in member experience and marketing. Explore options for your members to lock and unlock their cards with your mobile app if you don’t already have this feature; offer options for installment payments when using your cards; add contactless to the top of your implementation list; and consider cash-back rewards on your credit cards. 

Similar to what was recommended for digital banking, the retooling of your payments messaging should be about the features and ease of use. Skip the rate advertising and focus on the robustness of the benefits of carrying your cards, making sure to highlight the control and flexibility they offer.

Reflect, reconnect and Retool

Lead with your mission in your marketing. Describe the value you bring to your members, not only in savings on fees and lower rates on loans but by demonstrating your commitment to your members and your community.

It’s been a really long year for all of us. Take time to reflect on what you learned about your members and your organization during the pandemic. Then, set your sights on what’s next, making sure to understand what members need now and what they will need later. Finally, retool your member experience and marketing to better serve members long term.  cues icon 

Bryn C. Conway, MBA, CUDE, principal of BC Consulting, LLC is a longtime member of the credit union community and helps credit unions define their brands, develop their experiences and grow market share.

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