A couple of weeks ago I was lucky enough to interview Cornerstone Advisors’ strategy and tech guru Steve Williams for the very first CUES Experience Podcast.

What can you expect to see happening in the FI tech-space over the next year? Listen to find out:

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The rest of the CUES Experience Podcasts will happen live from the conference from May 13th – 16th. They’ll be hosted by Currency Marketing’s Tim McAlpine, so you know they’ll be great (for a sample, check out Currency’s podcast).

And on a final note, if you’re coming, don’t forget about my tour of Summit Brewing Company. It will be many good times.

Thanks to Christopher Stevenson from CUES for the opportunity and Steve Williams for his time and brilliance.

This morning we had the opportunity to hang out with some Gen-Yers and talk about how they bank, save, and plan for the future. Here’s a snapshot (note: because they didn’t speak in html code, I added the links) -

Marsha

...is a 23 year-old University of Texas student and Starbucks Barista. She says:

My debt is in student loans and credit cards. After I graduate, I’m going to law school. When it’s all done, I expect to have $200,000 in student loans. It could take until I’m 45 to pay them off.

I bank with a credit union, and do all of my banking online. All of my loans are through Wells Fargo and Sallie Mae, but if my credit union had private loans I’d use them.

I go to my mom for financial advice. There is so much clutter on my credit union’s homepage that even if they had financial advice I still wouldn’t read it.

Do I think about retirement? Well, I know I want to go to France and I want to write a book.

Aaron

...is a 24-year old developer for St. Edwards University. He says:

I do all my banking online. I use ING for everything. I used to use a credit union because my parents were members. But I dropped them when they killed their mobile banking.

ING’s Orange Checking account makes me more aware of how I pay my bills because I’m getting a yield. It helps me save and probably helps me pay on time.

Elysa

...is a 19 year-old University of Texas student. She says:

I probably wouldn’t go to a financial literacy seminar put on by a credit union or bank, but I’d listen to a speaker invited by my sorority.

I’m a business student, and plan on learning about investing through classes at school.

I have no debt, I was always told to pay my credit cards in full (my dad is financial advisor).

Our very own Trey Reeme is a guest on the latest episode of Current Issues in Credit Unions. And, might I say, he is quite eloquent and likeable.

Topics range from “Google-bombing” to “ways a credit union can improve its bottom line” to the melancholy business of “dealing with the death of a member” (legally, not emotionally).

Get it in iTunes, download it directly here, or visit the CiiCU site to listen.

And yes, I was making faces at him during most of the conference call.

Thanks to Chris Miller, one of the creative geniuses behind the Coast Capital Savings Credit Union website we discussed a few weeks back. He’s their Web Editor, External Sites, and he graciously hooked me up with some answers as to what went on behind the scenes in launching their new website.

Trey Reeme: Chris, we’ve been doting over your new website since we first saw it. You worked with an outside agency on the project, I’m guessing?

Chris Miller: Yes, we worked with our advertising agency, Rethink, and their interactive design partner, Burnkit.

TR: Mighty fine work you got from both, at least from what I think the finished project says about the quality of their efforts. How long did the project take from start to launch – and how did you manage the creative process?

CM: The project took approximately one year from start to finish. Development and QA took approximately 3 months. The creative process started with a creative brief defining our current state and goals. We then worked with our agency to create the site wire-frames based on the information architecture created within my department (E-business development). Once the wireframes were completed the interface design was proposed, reviewed, revised and finalized.

Julie, our Online Greeter, was developed as a natural extension to our already established brand. We had previously created a micro-site targeting the youth market with a supporting DM piece and guerrilla marketing to drive traffic to the site. Julie also mirrors our approach to our television, radio and print ads.

TR: So, who’s the real-life “Julie” and is she being used in any of your offline marketing?

CM: Julie is an actor – Jackie Blackmore. We are considering possible offline marketing tactics for Julie based on the success of the site.

TR: Very cool. So how did you manage the redesign process?

CM: For the creative process for the online greeter development we created a list of products, services and top searched terms and popular pages to create skits. Scripts were provided by our agency on each topic for review, and once the content of the skits was finalized a three day shoot was completed to film the skits. The clips were reviewed and selected, edited and polished for audio and compressed for use with Flash video. Development for the greeter application was completed by Burnkit, which included a CMS tool that allows us to manage the skits and videos, search terms and promo links, as well as a robust reporting tool to gather stats on popular skits, search terms, user session data and more.

TR: Who actually wrote the copy (it’s absolutely amazing, by the way) – and how tough was it to balance entertainment and humor with professionalism?

CM: The copy was a joint effort with in-house subject matter experts and a writing committee, and our agency. Page content was reviewed for accuracy and broken down to its base message and content – a lot of unnecessary content was removed. E-business development worked with Marketing and our agency to create a writing style guide. From there our writing committee (made up of a member from marketing, communications, and my department) wrote most of the copy, and then sent it to our agency to add the humour. The balance of humour and professionalism has always been one that has tightly defined and executed with Coast Capital Savings, as our approach to banking has always been a little different. Our goal is always to offer simple financial help – breaking down our products and services to a base level and taking a light approach to topics that are often considered to be of a serious nature.

TR: What’s your member response been?

CM: Quite positive – as far as launches go it has gone very well, with a handful of issues and a small amount of negative feedback. We’ve had a lot of very positive feedback from both members and non members.

TR: Speaking of feedback, have you thought about blogging with your members or adding RSS to the site?

CM: Yes, both. We’re investigating both aspects and hope to implement both in the future.

Thanks to Seth Godin for this interview. Matt and I will be live-blogging CUNA Future Forum, so who better to kickstart the conversation than the man who defines marketing?!

Trey Reeme: Seth, Permission Marketing and Purple Cow are bathroom books in our office – unofficially it’s the highest honor we can bestow upon a written work.

Now that I’ve flattered you, I’m going to throw you a softball to make me look like a nice interviewer. Off the top of your shaved head can you name anything remarkable about credit unions?

Seth Godin: Credit unions are like Cheers… the inherent promise is that people know your name. On top of that, credit unions can offer things that are harder for banks to… and last, credit unions have the perception that they keep out the riffraff, and thus can offer a better deal.

me: To borrow from your vocabulary, credit unions are brown cows among financial service providers.

First, let me bore you with some stats. There are 9,000 different US credit unions, but that number is shrinking almost daily and could be down to 5,000 in 2025. The average CU member age is 47 years old … and graying. Banks (the sworn enemy of credit unions) are touting a recent survey claiming that over 40% of their customers have low to moderate incomes compared to 30% in credit unions. That matters because credit unions enjoy tax-exempt status partly because of their mission to serve the underbanked.

Since this interview is a teaser for your upcoming keynote address at CUNA Future Forum, I’ll throw in some CU trivia. CUNA’s “Little Man” (their cartoon spokesperson from the 1920s to the 1960s) represented the “common people of the credit union movement.” Banks, on the other hand, were seen as stoic, greedy, and inaccessible to the average Joe. Banks are successfully changing that perception.

Citi lets customers press “0” to talk to a real person. Bank of America promotes a “Keep the Change” program to encourage casual savings on debit card purchases. Wells Fargo blogs about earthquake preparedness. And WaMu is even making fun of old, stodgy bankers in a witty new ad campaign. Banks are acting, well, human. Am I just being an alarmist, or do these things point to an impending crisis for credit unions?

Seth: Oh, there’s no doubt that there’s a crisis. I think it’s not for the reasons you list as much as it is apathy on the part of the consumer about banking and the entire experience. It’s become an aggressive commodity.

me: In Purple Cow, you bring up the story of Wal-Mart, who, in wanting to catch up with Amazon.com, displayed the famous banner in their offices: “You can’t out-Amazon Amazon.” I’d argue credit unions are trying to out-bank banks, and that’s creating a lot of confusion among consumers about what a credit union really is.

Why should credit unions come up with Purple Cow products even if those offerings don’t appeal to the early and late majority of consumers?

Seth: Credit unions have a sliver of permission. A tiny ability to talk to people who want to be talked to. So, you must talk to them about something interesting, almost exciting. You must reach the people who are trying to listen and ignore those that are ignoring you.

me: Ok, now that I’ve ranted about the credit union industry, I’m going to turn right around and tell you that I really do love credit unions. I haven’t come across a single credit union that didn’t deeply care about the well-being of their members. That being said, they’re not communicating/marketing effectively enough. So, considering the story of social responsibility (“People helping people”) behind the credit union movement, how important is it for credit unions – both individually and collectively as an industry – to tell that story?

Seth: This is the only story you’ve got! You can’t play the interest rate story. You must invest in the infrastructure to tell an authentic story about caring and membership and transparency.

me: If you were running a credit union, where would you be putting your marketing dollars?

Seth: Oh, superbowl rap commericals, for sure. Actually, I’d spend it on people who care. I’d make every single interaction with a consumer into a marketing exercise.

me: Final question: Did you ever find out what was up with the piece of Capital One junk mail that arrived in someone’s mailbox with Attn: Seth Godin on it?

Seth: My readers think that because my name is out there, someone built a fake list and sold it. But no, I have no idea.

Many thanks to Glen Urban, Professor of Management, Co-Director of the Center for eBusiness@MIT, and Dean Emeritus at MIT’s Sloan Management School. I recently read his latest book Don’t Just Relate … Advocate!, and this interview discusses advocacy, blogs, and credit unions – and it even includes a Jimmy Buffett reference for any Parrotheads out there.

Trey Reeme: Dr. Urban, it’s been almost a year since the book was released and credit unions keep buzzing about it. It made my reading list after I was asked the same question again and again: “Have you read Don’t Just Relate … Advocate!?” I got tired of feeling ashamed that I hadn’t. Now that I have, I realize I shouldn’t have waited so long.

Page after page, I found myself applying your views on advocacy to business blogging. As business blogs have really taken off since the book was published, I wondered, “If the book came out today, would he discuss blogging?”

Glen Urban: I finished the copy in January 2005 and blogs and RSS were taking off. I should have included material on this emerging trend. Obviously today it would have a major section in the book.

Blogging is real evidence of growing customer power and the need for transparency – there are no secrets. Communities have been around, but the impact of blogs and social networks will be the next evolutionary step in customer information power. Definitely would include blogs and new innovations in friends networks and self governing micro communities.

TR: I just had to mention it because Wells Fargo just launched a blog, and many of the companies you discuss in the book (GM and First Tech Credit Union included) are blogging directly with their customers.

GU: I have been working with GM and First Tech and Tom Sargent (CEO) at First Tech is a real innovator in the CU space. He was the first to try trusted advisors for mortgages supplied by Experion Systems (a firm I co-founded to diffuse this innovation). GM has pockets of innovation (Lutz’s blog and the customer advocacy work I describe in my book), but it is a big ship to turn around especially when they are fighting for survival.

TR: You describe advocacy as a mutual dialogue – a partnership between a company and their customers. And you start the book with a rhetorical question: “What would you do if your customers knew everything about your company?” You explain that customers do know everything about a company because they’re empowered by the Internet. Companies can choose either to advocate for their customers or languish in a world that’s already changed.

You explain that credit unions rate very well on an industry trust scale but that they aren’t ranked high in the areas of transparency and providing product comparisons with their competitors. Since writing Don’t Just Relate … Advocate!, have you noticed any improvements by credit unions in these areas?

GU: Credit unions have many strengths (good levels of trust) and weaknesses (slow to innovate, sometimes antiquated boards that are not quick to respond to threats and opportunities, and lack of scale). I am giving a keynote at the NACUSO conference May 17 which will present a full strategic review of CUs.

They face challenges from aging memberships, flat growth, and increasing competition from many directions (even Wal-Mart and H&R Block), so they will have to innovate in new products for the generation X, Y, and Z and segment services for the aging baby boomers. This will require new marketing strategies especially for your generation – word of mouth, communities, blogs, and real advocacy services for customers (e.g. advice on mortgages and also competitive comparisons and customer ratings).

Credit unions have moved to community charters and have lost their employee affinities so they need to be more nimble, innovative and advocate for their customers. CUs need to innovate or suffer slow decline and death.

TR: You’re right – reaching the elusive young adult market is a traditional marketer’s worst nightmare. Personally, if my email address is on a mailing list, I don’t even know it because it won’t find my inbox. I’m not on the Do-Not-Call list because I cancelled my home phone. (Take that, Dallas Morning News subscription-pushers.) I’ve never set foot in one of my own credit union’s branches. Ever. Not even to become a member.

So, what advice can you offer a credit union struggling to connect with someone like me?

GU: This is a challenge even if you have truly transparent and advocate services. Word of mouth is the best way. They need to get their happy customers to spread the word in blogs and friends networks. Some incentives might help, but they would have to be honest and subtle (tell a friend and earn free services??).

A CEO blog would help and your blog is a good info source. PR might help in the right media, but again you may not be reading them. Perhaps a Google sponsored link with an honest advisory service might work “Sponsored link; Credit Unions can give you all the information you need to find a perfect mortgage – even if it is not from them”.

Take a look at Fidelitylabs.com mortgage advisor which is an advocacy service (they even tell you how to negotiate closing costs and give you reasonable fee levels) that is getting a lot of buzz. And Fidelity does not even sell mortgages. They are doing it to build trust in hope of getting more investment clients.

TR: Speaking of innovations in advocacy, what’s in the works for you right now?

GU: I do my research at MIT and right now I am extending the GM advocacy system to a test with a dealer (to get the showroom experience into a genuine transparent experience that build trust), a broadband advocacy advisor for BT in Great Britain (this one morphs to individual cognitive style to help build trust), and a load advisor for Suruga Bank in Japan to look at how trust cues vary across countries.

TR: Bonus question: what business book sits atop your “must-read” list?

GU: I like Freakonomics because of the stress on learning from data, but I would be sure to add a lot of creativity to interpreting the data and its implications.

The last book I read is Jimmy Buffett’s A Salty Piece of Land just to remind us that spontaneity and whimsy have a place in all this.