Even the best-run institutions seldom enjoy an indefinite run of steady, gratifying growth. Banking trends run in cycles and slowdowns and reversals will happen, sometimes with little warning. Some institutions will hunker down defensively, conserve their resources, and wait for the situation to improve. Others will leap to the opposite extreme, reacting with alarm and seeking out change for its own sake.
There’s a middle course, one that takes advantage of any such fallow period to refocus on the institution’s goals and strategies. Those who take this long perspective are likely to emerge from the storm strong and energized, and ready to out-compete their less-focused peers.
Finding Your Focus
Any slowdown represents an opportune time to review your overarching goals, strategies and principles. There are numerous questions to ask yourself, but a few of the most important include:
- Are our long-term goals still meaningful and relevant?
- Do our principles and policies coincide, or are we seeing conflict between them?
- How likely is it that our current strategies and initiatives will be successful?
- Do the current challenges represent a transient headwind, or a fundamental change in our operating environment?
- Are we able to respond quickly enough to change? If not, what can we do about it?
Be clear about your ultimate goals and mission. If there’s any ambiguity about what you’re doing, why you’re doing it, and what the end result should be, now’s the time to address it.
Assess Your Performance Against Benchmarks
Any engineer will tell you that test equipment usually needs to be calibrated before you rely on it, and the same principle applies to your self-analysis. If you’re looking solely at how your marketing plan’s results correlated to your goals, you’re missing some important context.
First, to the extent that those numbers are available to you through annual reports and industry publications, you should be comparing your results to those of industry peers. Next, consider external factors such as the state of the overall economy or industry. Posting a small gain when others are seeing losses, or a small loss when others are posting large ones, looks different in that light.
Finally, compare your current campaigns against previous ones. Did those give better results, in the context of the larger market conditions prevailing at those times? If so, you’ll want to take a deeper dive into what differentiates your current and former marketing efforts.
Take a Hard Look at Your Marketing
With those thoughts in mind, take a look at several of your older marketing campaigns, both successful and less-successful. Again, comparing and contrasting the successes and failures is useful, but more so when context is taken into account. Knowing how your marketing efforts compared to those of your peers at the same time is important, and so is analyzing the market forces of each time period.
Remember, you’re not looking to simply replicate successful strategies from the past. Your goal should be to evaluate how well – and why – each campaign met the needs of its time, using the tools of its time. The tools available, and their relative effectiveness, will be different now. Discard anything that’s no longer useful, and focus on what you can move forward with.
Get as Much Feedback as Possible
Slow times often occur when your users’ (and potential users’) needs are changing. Sometimes that’s because of societal pressures such as the flight from small towns and rural areas, and sometimes because of significant external events like the crash of 2008-2009 or 2020’s COVID-19 pandemic.
It’s especially important during those times to reach out and solicit feedback from both users and non-users in meaningful demographic niches. Ask them how their needs are changing, and what services or products they would like for you to offer. In the case of current users, you should also be asking about shortcomings: “What aren’t we doing well? What do you dislike most about the bank/credit union? What’s the most irritating thing about our website or app?”
Look Seriously at the Research
That deep dive into your own institution’s operations should yield plenty of food for thought, but you should also be taking a bigger-picture perspective of the industry as a whole. The importance of the financial sector in general makes it a focus for major consulting and research firms including McKinsey, PwC and Deloitte.
For research that’s more credit union-specific, there are useful bodies of knowledge available from sources such as the Filene Research Institute and the PSCU/PMNTS.com Innovation Playbooks. In exchange for a relatively modest investment in your time, these organizations can help you stay up to date consumer initiatives, digital banking trends and best practices across your peer group.
These organizations have the time and resources to take a broader and deeper look at the future of the industry. Armed with that level of information and analysis, you can be prepared for change Instead of simply rolling with each development or crisis as it happens. If your current goals and strategies don’t account for those projected developments – changing consumer attitudes, data security issues, shifting regulatory environment – you’ll need to revisit your planning process.
Identify Your Competitive Situation
When asked what differentiates a credit union from banks and other institutions, “trust” and “community” are among the standard answers. They’re certainly important, but you’ll need to ask yourself what those things look like in the modern world. Many of your users, especially the younger ones, now look for those things online, and may seldom set a foot in your branch. How do you build trust and community with them? How do you leverage your strengths?
Those aren’t rhetorical questions, they’re crucial to your future. For example, “disaggregation” – the tendency to pick financial services on an a la carte basis from multiple vendors – is a serious threat to credit unions. Specialized, single-service fintechs make a virtue and a competitive advantage of their narrow focus.
You might choose to turn that against them: A payment processor can’t help with loans and a mortgage lender can’t do credit cards, but you’re able to “connect the dots” and offer an integrated package of products and services.
Work on Your Flexibility
Identifying the goals and strategies you want to pursue is an important part of the process, but so is assessing your ability to implement them in a timely fashion. What’s the gestation period of a new outreach or marketing initiative? Are there policies or management structures that slow your responsiveness? How long does it take to gather the data you need to inform your decisions?
Once you identify factors that impede your flexibility and nimbleness in responding to change, you can brainstorm ways to work around them. If user surveys currently take weeks or months, find ways to do them in days. If your analytics tools are cumbersome, find a platform that can provide you with data and analytics in real time.
Abe Lincoln is supposed to have said that “If I had six hours to chop down a tree, I would spend four sharpening my ax.” That’s what you’re doing at this stage of the process.
Downtime and Self-Analysis Can be Fruitful
When you go for a drive through the country, you’ll often see fields with no visible crop on them aside from a ground cover. Those fields are fallow, but they’re not inactive. They’re resting, reestablishing their soil’s fertility, and preparing to be even more productive in future.
That’s been a part of farming for centuries, and it’s a useful metaphor for a well-spent slow-growth cycle. If your planning and self-analysis is well thought through, you’ll emerge renewed, reinvigorated and more productive (and competitive) than before. Wherever the latest banking trends take you, you’ll be prepared.
If your analysis led to the conclusion that your current digital platform is inadequate to your needs, consider using your slow time to upgrade to Lumin Digital. Our software provides users with a digital experience that’s fast, fully integrated and seamlessly consistent across platforms. For your institution, it means real-time access to the wealth of user data that’s currently siloed in your servers, as well as the analytic tools you’ll need to for state-of-the-art planning and marketing.
Contact us today to request a demonstration, and learn how Lumin Digital can help you exceed expectations.
References:
- https://news.cuna.org/articles/116875-credit-unions-in-2030
- https://www.forbes.com/sites/jefffromm/2018/10/11/consumers-credit-union-and-the-future-of-banking/#2a995e6f6d18
- https://www.pymnts.com/news/security-and-risk/2020/credit-unions-cybersecurity-battle/
- https://www.cuinsight.com/was-is-%e2%89%a0-will-be.html
- https://filene.org/learn-something/reports
- https://www.pymnts.com/wp-content/uploads/2019/02/Credit-Union-Innovation-Index.pdf
