Bank of America Beat Us To The Punch, Again.
Ok, so it’s not like we can’t do it too - punch back that is. But its like having sand kicked into your face, again and again. I was a little guy, skinny and gangly - then I started drinking milk…
Sorry, it is a little late and I just read an article that frustrates me. Bank of America has launched a social network for businesses. Now you would think that if BofA is setting it up, it must be for its customers. You would be wrong. It is for any and all business owners or people interested in business or people bored with nothing better to do.
Now the site isn’t heavily branded to BofA. It does have a similarly designed interface (web 2.0) with a similar but lighter color scheme. It has resources for new business owners, existing businesses and entrepreneurs. It has forums and “Experts” sections. It has nifty “Two-Oh” whizz-bang items like tag clouds and “Professional Points” rating system and inter-member communications. It is a pretty cool site and it leaves me to only one question…
Why hasn’t a credit union done this? This isn’t rocket science. I could put a site like this together in a few weeks if I were doing it for myself. I have made a few sites like this for other industries. I have had credit union marketing VPs tell me that they WANT to do this, but can’t get it past the CEO or the board. Everyone wants to see someone else do it first. Yeah, thats a great strategy. Being second, ninth or a hundred fiftieth to do something is much better than being first. But hey, waiting for the first guy to do it is safe right? Let’s see what mistakes he makes and not do that.
Everyone wants to see someone else do it first. Yeah, thats a great strategy. Being second, ninth or a hundred fiftieth to do something is much better than being first.
That is an excellent plan! Can you smell the sarcasm?
I understand the mentality, please don’t misunderstand me. It is scary being a leader. It is scary jumping out in front and saying LOOK AT ME! WOO WOO! But, you know, I was told that second place is just the first loser. You can either innovate or stagnate. The choice is yours.
What you should ask yourself is: if it is a good idea, and it serves your members and it is not insanely expensive, then why not do it? If you are providing a service for your members, why not give it a shot? Call me a Pollyanna if you like. But it works. Let me give you a real world example in a completely different industry. Let’s see if we can draw a parallel.
As I have mentioned, I am also in the coffee business. When the Zone and Atkins came out, business started to drop. I had the same amount of customers, but they were ordering black coffee or coffee with cream. Very little income on a $1.50 cup of coffee compared to a $4.00 mocha. A drop in income was just not acceptable. I talked to the customers and figured out what was going on. After cursing Dr Atkins I ran to the local bookstore and picked up a copy of his book. I did research online and I took this knowledge to the grocery store. I spent weeks going to health food stores and grocery stores. I was shopping online and probably spent about $2,000 developing a recipe for an Atkins friendly mocha latte alternative that tasted good. There were a lot that didn’t taste good.
I did it. It wasn’t bad. It was sweet, thick and chocolaty. It was almost better than our regular mochas (slight sugar-free aftertaste though). It cost me $2,000 and 3 weeks of my very valuable time but I had something. I used this mixture as a base and created a whole “Atkins Friendly” menu. It was an immediate hit. We marketed to the low-carb forums, our customers told all the folks they knew who were on the diet. We were raking in the dough. We made press, we made hundreds of new customers and best of all, we were making money. Oh, I forgot one ast thing. Since we were making sugar free, low-carb drinks we saw an untapped market appear - diabetics. I continued to develop the recipes and expand the menu. Since no-one else had our recipe, no one could compete. Then a company called Big-Train came out with a few base mixes that made my product obsolete. I wasn’t mad, I had already exposed all these new customers to our service. They were hooked. They weren’t interested in going somewhere else. Then the diet fad passed a few years ago. Still the customers return. That $2,000 investment returned over $200,000 in sales and still generates new customers to this day.
Now, why do I tell the story. Easy. Give your members a reason to interact with your credit union. Thats all. Give them a reason to come in. Give them a reason to call. Give them a reason to do buiness with you in the way that THEY want to do business.
Stop pushing them away. If you have a janitor that comes in that has an idea to open a channel of communication with your members - DO IT! It doesn’t matter where the ideas come from. It doesn’t matter if you have never heard of the technology before. Do the research. Talk to people in the industry (technology not financial). Take advice from someone who knows but has nothing to gain either way. Like me 
Something like this may cost as much as one comprehensive campaign for your credit union, but could last 3 to 5 years with little change in code or design. So the amortized cost could be lower than what you spend on your copy machine lease in a month. Still think it’s not worth it?
Think about the benefits. You can “Listen in” on your members and they will tell you what they need. You attract business members who want to “network”. You have a list of people who want your services that you can email at will. You have members flocking to you and using you as a resource.
So now I am thinking. I can do this. Maybe I will. Maybe I will go ahead and make the site myself. Who knows, I am crazy like that. Sometimes I just like to see things work.
All I know is that for all the lip-service that credit unions are serving about wanting to get into commercial lending, they aren’t really doing much about it. Adding “Business Loans” to your brochure or web site is not enough. Bank of America is providing a venue for people (business owners and people interested in being self-employed) to share experience and affect each others lives for the better. Isn’t that the core mission for credit unions? Does this mean that BofA is a better credit union than the credit unions?
And to anyone who tells me that not everyone wants to be self employed, you are right. A very close friend of mine is a Fire Captain and he has no interest in being self employed. But quite a few of the firefighters in his command are. What about their wives? I have a client who is a nurse but is starting her own greeting card business. Everyone has a dream. And those who don’t have a dream of self-employment sometimes help those who do (can you say family referral?)
Look, I have dragged this on to another epic post. Bottom line. If you don’t have the time to take care of your members, don’t worry. Apparently, Bank of America does and will.
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Comments
Chris, I feel like I am banging my head against a wall. You know how I feel, I have posted on this before.
The worst thing is that if you talk to a bank, they will say “Well credit unions are non-profit so they can afford to be innovative.” and if you talk to credit unions they will say “Well banks are profit driven and if there is any profit to be made, they will do it first.”
It doesnt make any sense to me. Ultimately it comes down to who wants the members the most. If your credit union wants the members, it will do what it takes to provide the best service package. You might not see an ROI for a year or two - but you need to look at the long term strategy.
This post ended up being a bit of a rant. I apologize (I wrote it at 1am and hit publish instead of re-reading it this morning). No more late night blogging for me
Tony - I agree and it’s a message that bears repeating over and over. In fact, I’d move that we all collaborate on a blog that focuses ENTIRELY on this issue.
And don’t apologize - it’s bloggers like you who are up at 1 AM pondering the future of the credit union movement that are essential to our success.
Excellent points, Tony @ Christopher! You know what’s even scarier about the lack of participation in Social Media among CUs? The campaigns are fairly low-cost to assemble and implement … and if they bomb, NOBODY is gonna know it failed! (As creator of the Marketing Council Cookies blog, I know what I’m talking about on that note!)
So what’s the big deal?
On a similar note, check out BoA’s facebook group…one of the few banks OR CUs on there.
Someone over there “gets it.” Why do I get the feeling that in 5 years, someone like BoA will be an even bigger behemoth and CUs everywhere will shake their heads and wonder what happened. Most seem to be waiting for someone else to do it right and then copy it.
I posted a quote recently on my blog on the ROI of Communitiesthat sums it up:
“Firms have to recognize that there is just so much innovation, that the speed of change is so accelerated, that they cannot possibly hope to control or own it all. There’s just no way. My best advice? Use social networking technology to ride the wave that’s already forming, rather than make it yourself. You’ll end up ahead of the game, with far less energy, capital and resources spent.”