I’m going to offer to help you with this problem WITHOUT any cost – read all the way to the bottom of this post!
I’ve spent a lot of time lately discovering what credit union senior executives find most challenging in adjusting to COVID-19’s impact. What is keeping them up at night? Just one of the top tensions is that of retaining market share in the face of a higher risk of member switching. There’s a general sense of vulnerability when it comes to keeping members attached to their credit union when they are now conducting their business very differently than they were earlier this year. Consumers are also more sensitive than ever to frustrating experiences, to experiences that fail to meet their expectations. Americans are edgy, and the data and stories are bringing this to light in living color! With uncertainty about the future, economic insecurity, and health-related fears, consumers react quickly and impulsively to anything less than the service they expect. This pervasive stress makes hair-trigger consumers more sensitive about their money, as well – and where there is tension, people pay attention.
The Fact of Friction
With so much at stake, it has never been more important to be in touch with how your members are feeling when they do business with you. For credit unions that do not or cannot capture this in a way to actionably pivot toward securing member relationships, the balance sheet will be bleak.
Senior executives, here is my question to you:
Exactly when and where are your members encountering friction in doing business with you, regardless of the channel – and how much friction are they willing to tolerate?
Most executives I’ve talked with have admitted that they don’t know exactly where the friction is. What’s more, gauging members’ willingness to tolerate the friction is a new thought entirely! Members are willing to put up with a certain degree of friction if other things they value outweigh it. This tolerance for friction can’t be captured in an NPS score. There’s specific data to be captured about what friction is tolerable and what friction is intolerable for your members. Are they willing to tolerate fees or pricing that’s not as competitive, or technology that’s not as state-of-the-art, when they have a strong degree of confidence in you? Conversely, what measure or degree of lack of confidence triggers their switching – the quick cancellation of their relationship with you (which they may even do gleefully)? The answers to those questions are VERY different than they were four or five months ago. Inconveniences and annoyances that may have been overlooked or patiently borne in pre-pandemic circumstances can tip the balance today in favor of reflexive action that has dramatic results.
The Cost of Not Acting
There’s another layer to consider in your strategizing: cost. When credit unions look at member experience issues, they must face up to the expense of delivering that service. There’s always a cost of removing those frictions – as any good CFO will remind you – whether it’s in actual expenditures or some risk the credit union is willing to assume (e.g., trading greater account security for a quicker log-in process). Without good data, credit union leaders can’t make that determination. Without hard facts, they can’t do that cost-benefit analysis. Credit union leadership must be aware that every step to improve the member experience has a budgetary consequence that forces you to make hard choices about where your priorities lie. Those are the realities, my friends, but without them you could pivot in a WRONG direction and end up “tripping over dollars to pick up pennies.”
Well, we’re not taking that literally so much today, given the general aversion to touching cash. Investing in the member experience generates its own returns any number of ways: member retention, improved operational efficiencies that reduce friction, building wallet share through member relationships. But only when you have invested in learning the clear facts can you have a clear line of sight to act. Not investing in learning the facts brings its own set of costs, even if they are not realized today – and they may well turn out to be many times greater than the initial expense would have been!
We’re in a different era, one that requires senior level executives to make strategic decisions more quickly, taking many factors into account. Where so much depends on making decisions that lead to predictable and desired outcomes, having the right facts to inform those decisions can be the difference between sustained success and…more sleepless nights.
Credit Union CEOS: if your strategy needs fresh, timely and thought-provoking challenges, I’m here to help. Let me and our team of experts put together a CX Analysis for your team to challenge and create a clear strategic advantage:
