Bellco-operative or not?
Posted by Trey Reeme on September 19th, 2007
Sometimes I believe we work in the most uncooperative cooperative industry in existence.
This may seem unrelated to Bellco, but hear me out: While Wings went about it all wrong, Continental FCU had become complacent.
Maybe I was so upset about Wings because it seemed the most uncooperative action possible between cooperative credit unions. At the time I thought it would trigger a rash of similar attempts throughout the industry.
Hey, I’m an idealist and a “worse-case scenario” kind of guy.
That said, I voted “Great Job, Bellco” on Tim’s poll.
85% of respondents agree as I type this.
Competition = good for consumers. Right?
Trey -
I think I am old school (or just an old cynic), but I hate this approach! Whenever anyone offers me money to “sign on the dotted line,” I get very suspicious.
Added to this, I would be PO’d if I were a Bellco member (where’s my hundred bucks for cryin; out loud?!).
It looks like Bellco can deliver on the upfront money proposition but long term … they better deliver on the value proposition. You can’t gimmick your way through that.
Signed, The Old Cynic
No worries about being a cynic/old school.
I actually wanted to hint that I don’t like it from an idealist’s perspective.
In fact, I wouldn’t have taken the shot myself.
That said, I don’t think it’s the downfall of credit unions, and it does make business sense… that is if it doesn’t highly hack the members off.
Trey,
See, I voted “Undecided”. I also had some concerns and this is why.
I think the campaign smacks of desperation. It basically says “We have given up on trying to convert bank customers and have begun to fight amongst our family.”
I would hate to see the credit union get al “Lord of the Flies” because it is easier to go after each others members (people who may have already bought into the CU culture) than it is to bring in converts.
Yeah, it is easier, and the credit union might get some new members and pad their financials – but what happens when the cooler credit union shows up across the street and does it to you? It sets a scary precidence.
Yeah, I guess I am a bit of an idealist. But I still think the strength of credit unions are their cooperative nature. Banks don’t work together. Ths leaves them vulnerable. There are very few credit unions that can break off from the herd and make it on their own. Then where does that leave the rest of us? Do we stop sharing data and strategies because now they may be used against us in a smear campaign?
I think I am falling on the side of “Not a good idea”. I just on’t see a positive side to industry cannibalism.
Typically, cannibalism sacrifices the weak first.
Just my contribution.
It’s only a good and/or novel idea unless it hits close to home. @Trey – If one of your competitors offered your Trabian clients $10,000 to switch over to their content management platform—would you view that as good competition? Is that competition? How should you react? Offer your own clients money to stay, how about offering their clients $11,000 to switch? Would you want to lower your standards?
In my opinion, It detracts from the value proposition; what retains customers/members? If credit unions/banks are doing their jobs, members/customers won’t be tempted. Those that are and do move, let them. They’ll be back.
Offering cash is a cop out whether you’re a bank or a credit union. I just can’t see how that is good for competition on any level.
I voted shame on Bellco. Cam’s right about when it hits close to home. I used to work for a CU that went after other CU’s members agressively, and I was a pretty good member theif because it padded my incentive sheet nicely. (So shame on me too.) How far will we let our ideals slip in order to make more money? I’ve seen good CU people do bad things to other CU’s and in hindsight I’m ashamed to say that I was part of it by not stepping up and voicing my objection.
Back to hitting close to home: A few years ago a local small CU chose to merge with Piedmont CU because the obvious merger candidate, a larger community CU, had previously launched a campaign to steal their members, offering certain incentives similar to what Bellco did.
I see CU’s as idealistic by their very definition. When we sacrifice our ideals we lose what makes us different and become just like everybody else chasing bigger dollars and not truly serving those we are commissioned to serve.
Bellco members shouldn’t be upset, there’s nothing wrong with offering an incentive to get new members or running any other promotion. But if they are upset they should speak up and exercise their membership responsibility.
Great points, Tony, Cam, and Dan -
Is this the action of a “cooperative” cooperative? Heck no.
It’s a shark attack.
You all know me well enough to know I’m an idealistic cooperative lover.
The campaign is effective marketing. I voted by looking at the campaign, which is (you’ve got to admit) slick.
Would I really support it? No way. It goes against the credit union philosophy – which I absolutely stand by.
On this issue, I wasn’t voting based on philosophy, which I’ve been accused of doing way too often in the past.
You’re right Trey, it was a great idea. If a big bank came and swallowed up one of our small local banks I think it would be a very appropriate and successful campaign. Maybe the Texas CU acts more like a bank and had it coming to them? I guess we really don’t have enough information to make a sound judgment. But that usually doesn’t stop us from trying!
I’m glad my post sparked some interesting discussion. I commented on Ron Shevlin’s post about this and thought it worthwhile to chime in here as well.
This has been an interesting topic to watch how people side. As my informal poll indicates, close to 80% of my blog readers say ‘Great job Bellco.’ This is surprising to me as I believe most people looking at credit union industry blogs tend to be on the altruistic side like Trey, believing whole-heartedly in the credit union philosophy. Hey, I’m definitely in this camp too.
It is interesting to watch the credit union industry struggle with how competitive to be. On one hand, we’re all in this together, almost like a quasi-franchise network, but then on the other hand there is real secrecy and animosity towards direct competitors and a reluctancy to work together to defeat the big evil banks. This comes up constantly in our dealings with our own credit union clients.
I think Bellco’s move was a good one, and I don’t believe it hurts the cooperative movement. I believe that the reality is that for the cooperative spirit (the ideal) to continue alongside the competitive environment (the reality), CU’s will simply have to find new and better ways to embody the credit union spirit. I think we all believe the credit union movement transcends the mere question of “do we compete or collaborate?”
That said, I think Bellco’s execution was mediocre. The whole message strategy of “they’re not local anymore, but we still are” is common-sense, but oh-so-tired. I think that if they step back and really figure out what their brand stands for, they could find a far more compelling reason to capture customers than “we’re still local.” Snooze. That’s what EVERY still-local bank or credit union says EVERY TIME its competitor is acquired.