CU Soapbox

In Defense of Email Follow-Up: I'm not the only one who's defending email!

2009-11-12T11:35:56-05:00

by Ron Daly

Last week, I reacted to an article from the Wall Street Journal about the impending death of email. I tried to give credit to Twitter, Facebook, etc. for the roll they've played in changing how we chatter at each other day-to-day.

Kit Eaton at FastCompany.com put together a great story called "Why Twitter and Facebook Will Never Kill E-mail". This article points to some interesting findings from Nielsen and some facts about email that many overlook when they dismiss email as "on it's way out".

For one, you can't send files directly via "tweet" - and, for all I know, you can't do that over Facebook, either. You can provide links and downloadable files that are hosted elsewhere, but these messages don't have the capacity to carry vital info. And who owns that info when you upload it? Rights issues are plaguing this new territory right now, and corporate/private communication can't be done in the blind - or worse, in an environment where security isn't prized.

But maybe the best point brought up about email in this article is the idea of simplicity. Email is easy to learn and to use (for most). People have spent the past year squawking about Twitter being impossible to understand and arguing about its usefulness. Seems to me there might have been an hour-long window where the people who invented the first email systems were asking themselves "When will this ever be of any use to anyone?" Then they realized that email was sending messages in seconds when it formerly took days.

While we're talking about email's long life, this Google Wave affair is interesting. Real time communication mixed with email mixed with...well, I'm not really sure. Jimmy, my Creative Media Directory, has been sniffing around for invites. Has anyone used it? Can we get some information on how it handles? Talk to us about it.

Grasshoppers, Ants, and the CARD Act

2009-11-10T08:52:25-05:00

by Ron Daly

Remember the story of the grasshopper and the ant? The grasshopper sat back and didn't worry about winter until it was too late, the ant clambered to get more food to outlast the cold. In the end, the ant gets all his food and preparations in order, and winter never even comes and everyone's fine.

Wait, that doesn't sound right. Wasn't the grasshopper supposed to be, quite literally, left out in the cold? Didn't all that preparation pay off for the ant who worked so hard to get it done? Maybe I'm thinking of the wrong story. Maybe I'm thinking of all the credit unions who worked to get their statements and documentation around HELOCs, Personal LOCs, and open-end credit adjusted to comply with the Credit CARD Act of 2009...and the CUs who somehow came out ahead by not trying to comply or waiting out the change to the bill. Doesn't sound fair? Few things are these days when it comes to regulation.

Let's jump in the Wayback Machine and go back to July 30 of this year, one of our most commented blog posts ever: "Caught by the Fan!" We drew a lot of commentary and thoughts from the people who know a thing or two about compliance. Friends-of-blog Anthony Demangone and Rob Rutkowski were kind enough to peel away a few more layers on the problem and talk about exactly what the legislation would do to CUs.

But just recently, Congress (prodded by the trade groups and lobbies) produced the CARD Act Technical Corrections Act (H.R. 3606), making clear that the rules only applied to credit cards.

From CUNA News Now -

The new CARD Act law fixes a situation that has been plaguing credit unions since the original Credit Card Accountability, Responsibility and Disclosure (CARD) Act was signed in May. That bill incorrectly implied that a 21-day late notice requirement applied to all open-end credit, and the Credit Union National Association (CUNA) has argued that it had always been lawmakers' intent to apply the provision only to credit cards.

The corrections bill states clearly that the late-notice provision applies only to credit cards.

I know there were a lot of CUs out there who had to work at compliance and spend a lot of money to bring open-end lines of credit in compliance by August 2009. In hindsight, those financial institutions that took no action on the unintended consequences of the CARD ACT and waited for the CARD fix turned out to be ahead of the game (money, time and worries). So if we know that a regulation is blatantly wrong and a fix is coming, is it better to be a grasshopper or an ant?

In Defense of Email

2009-11-02T12:18:56-05:00

by Ron Daly

I had this article dropped on my desk earlier this month - "Why Email No Longer Rules..." by Jessica E. Vascellaro at the Wall Street Journal. I sat on it for a while, trying to figure out what to say about it.

Long story short: Wrong.

Now, I can't disagree with a few key points brought up by Ms. Vascellaro. These are:

Twitter, Facebook, and Social Media are set to "profoundly rewrite the way we communicate" - I'd argue they already have. You don't have to do ALL your communicating through email, the way we had to in the 90s. We've got blogs, Facebook walls, Twitter feeds, Flickr streams, etc.
Social media is a constant stream of information that, often, can't be squelched or silenced, and can cause "communication overload". Email can be guilty of this, too - if you let it.

But some of Ms. Vascellaro's observations left me scratching my head. For one, the statement about email being "better suited to the way we used to use the Internet", and how that doesn't cut it anymore. Why, exactly? Because we don't "log on" and "log off" and we're always patched in to our inboxes? I'd think that makes email MORE important. The first thing that happens when you get a smart phone after it's set up by your carrier, they enter your email accounts so you can read emails as they come. We're walking around with our inboxes in our pockets. That somehow makes email less important or less useful than Twitter? I don't buy it.

The article goes on to say that Nielsen Co. put email users at 276.9 million people in the US, Europe, Australia and Brazil, whereas there are 301.5 million using social-networking and community sites. Not knowing which study was which (maybe one of our many marketing-focused readers can leave us a link in the comments?), I'm curious about what qualifies as a "community site". Is a blog one? How about a personal web page? Are they counting multiple addresses for single users? I'm not sure how they're qualifying accounts and users, but I do know this - there are few (if any) online services one can use without an anchor email addresses that the administrators of said service can send emails to for confirmation, announcements, complaints, etc. Like bank accounts, your social media accounts need your "permanent address", somewhere they can reach you when you need to be alerted to something. Email addresses are likely fitting into their place - as the "if all else fails" means of communication online.

I mentioned earlier the thought of "squelching" social media. In the article, Vascellaro talks about how "more sophisticated" filtering systems are necessary and how certain sites like Facebook are letting you choose who you read when you log in, and who gets left out of your communication flow.

How to you suss out who's worth listening to and who isn't? Twitter recently announced they'd be adding "lists" - ways of sorting your followers/followees so that you only have to read the posts of select users (side note - you can share these lists with other users, which I think is kind of neat). Want to know the easiest way to sort out what you want to read/don't want to read and who to contact or avoid? Put those people in your address book IN YOUR EMAIL ACCOUNT. Seems simple to me, but hey, I'm no "new media guy".

Finally, there's the security issue. Yes, maybe your email account can be hacked. But there's a history of stronger and stronger security around email accounts as the need to transfer data has become greater and the kind of data being transferred via email has increased in size and importance. The same can't be said of Twitter, which is scaling but still behind the curve on security. Not that Twitter is completely unsecure or unaware of their security issues, but they've been slow to let people verify accounts that they use for business communication (a bitter pill for some of our associates - read here). Also, so many "companion sites and services" are being made for Twitter every day that passwords and usernames are being thrown around like confetti.

This article seems critical of Social Media in this respect, noting that personal information is flowing more freely these days. At best, personal info can be insightful or entertaining. But it can also be downright annoying ("Great, you had oatmeal for breakfast. Thanks.") or even compromising to your online security. Remember Sarah Palin's email breach last year? It all came down to a password that hackers found fairly easy to guess based on public information about her. All that loose information that people treat as "unimportant" can actually be used against you.

The article gives a person a lot to think about, but I think it's overshooting when it says that email doesn't "rule" anymore. Email still has its place - the cornerstone of online communication, the best way to reach someone who you just can't get ahold of otherwise.

A Revoltin' Development

2009-10-28T11:30:47-04:00

by Ron Daly

We've already established that there's a "debtor's revolt" going on in this country. Our rioters are not people who knowingly drove themselves into hundreds of thousands of dollars in debt, mind you. They're good people who make their payments, don't default and try to get ahead honestly. People that, as we discussed last time with our Suze Orman video and my Chase-chess game, are sick of big banks and lenders trying to rig the game.

The revolt came to Chicago yesterday as protesters organized by the Service Employees International Union and National Peoples Action marched on the ABA Convention (click here to read the CU Journal story). Even as representatives of the ABA tried to pardon their members, citing that the crisis was not specifically caused by banks but by lending powerhouses like Fannie Mae and Freddie Mac, the crowd gathered outside to register its displeasure. According to the article, the protesters also visited offices of Goldman Sachs and Wells Fargo - two institutions that are not ABA members but did receive bailouts.

Maybe they should have swung by Detroit, too. The Feds are looking to shovel another $2.8 to $5.6 billion into GMAC in exchange for preferred stock. That would make three bailouts for the auto company that's staking its future on the 230 mile-per-gallon Volt hybrid, not due on the market until 2011. How many more bailouts are we going to throw at GM until they're able to do right on their own? Do we have to pour in $10 billion per year until they have a competitive product that the market is interested in buying?

Maybe we're being to narrow in our definition of "debtor" when we're talking debtor's revolt. We're going to be paying off all these bailouts for decades, maybe the next century. Unless, of course, in the next few years we get taxed to death by a government that suddenly realized it was out of money. Either way, we're going to be busted. Each and every one of us is thousands in debt, if not personally then because someone keeps writing checks on our behalf to companies and banks that keep failing over and over again.

Thrill of the "Chase"

2009-10-16T11:21:37-04:00

by Ron Daly

Visit msnbc.com for Breaking News, World News, and News about the Economy

If you're viewing this post through email, visit the online version at CUSoapbox.com for the video. Current version of Flash Player required to view.

Re-read the "Debtor's Revolt" story here.

I want to share an interesting chess game I have going with Chase over a 3.99% cash advance transaction from 2007. I figured I’d take them up on a balance transfer under an agreement that the rate will remain 3.99% for the balance of the transfer unless of course I default somehow. Here is what they're doing to try and get me to default.

They’ve raised the base rate to 21% on a card I’ve never used for anything else
Lowered the credit limit to just above the balance in hopes that I might exceed it
Changed the due dates twice. Fortunately, I always open bills before filing and write the due date on the outside (sorry, old accountant habits never die)
Now they have increased the minimum monthly payment from $85 to $420 in one billing cycle (that’s 494% increase)

Guess what, Chase? I’m one of the lucky ones that can still pay the ride and you can’t change the rate. I understand that the federal government had to bail Chase out and not let it fail because of the market meltdown. I think it’s time that Chase and some of the other banks and credit card companies gouging consumers start failing for the right reason.

Fail because:

Consumers, as the movie line goes, “are mad as hell and not going to take it any more”
Consumers stop using them and shift towards credit unions that have decent rates and fair credit card practices (as mentioned by Suze Orman up top of this post)
Credit union loan officers steal every single loan and credit card balance they see on credit reports away from Chase and help members
The credit union industry seizes the opportunity to go on the offensive to drive policies with lawmakers that capture and hold market share

I think that Barney Frank should not only move up the next phase of the CC Act, he should also consider making it retroactive to January 2009 and make all these credit card companies and banks refund the excess fees and loan shark interest rates back to the consumer. They are the ones getting away with it while consumers and credit unions pay the price.

Gotta run, my email alert to pay Chase just came in from my credit union’s online banking system.

While Some See Red, Old Hickory Credit Union is Seeing Pink.

2009-10-14T12:06:30-04:00

by Ron Daly

I'm sure football fans have noticed all the pink surrounding their favorite teams, cheerleaders and even stadium equipment the past few weeks. Sports Illustrated even "went pink" in its most recent issue, all to acknowledge the fight against breast cancer. I saw a great program go across the DigitalMailer production line this week and wanted to share it with everyone.

For the month of October, which is Breast Cancer Awareness Month, Old Hickory CU is working hard to increase awareness and contribute to cancer research. Their approach, outlined here in their monthly "Money Memos" newsletter, which by the way is pink this month, is threefold:

1. A team of Old Hickory CU employees will be participating in the Nashville Making Strides Against Breast Cancer event on Saturday, Oct. 24. Their goal is to donate $2500 to the American Cancer Society;

2. Old Hickory CU is selling pink umbrellas for $15, with $7 of that going to the American Cancer Society. These umbrellas also come with a set of coupons for credit union services that benefit members; and

3. All branches are offering information on breast cancer awareness, as well as supplemental cancer insurance policies.

When we inquired about the eLert topic Malinda Warchus, Assistant VP of Marketing commented "It might seem like a strange thing for a financial institution to send out an eLert about, but we are committed to improving the lives of our neighbors and making a positive difference in our communities. The outpouring of response from our members tells us that they like joining our cause."

Not strange at all...and we agree with the members! In fact, I hear our DMI team is in line for any umbrellas that are left once the members are taken care of.

Most of the time, Credit Unions think they can only use member email addresses for eStatement notifications, newsletters or selling a new product or service. Those same email addresses can be used to communicate the difference between a bank and a credit union, as well as raising awareness among CU members the community outreach credit unions are involved in. Old Hickory CU has done just that by tying into a national promotion and using inexpensive methods of communication (email, electronic alerts, and monthly newsletter) and community outreach to reach members and potential members at a fraction of the cost.

Kudos and this effort speaks to the character of Old Hickory CU employees and management. Keep up the great work!

Anti-Social Media

2009-10-07T10:46:51-04:00

by Ron Daly

Back in April of this year, Jimmy [my Creative Media Director] pointed me to this story that unfolded on Twitter. It was the story of "The Credit Union Receptionist", a young lady kept a personal blog and wrote a lot of unsavory things about coworkers and members in one particular blog post. That post was read by several credit union muckity-mucks, who launched into a lengthy analysis of the situation.

After a long list of thoughts/feelings shared on the subject and a LOT of cross-talk on Twitter, someone called the credit union to speak with the young woman who wrote that blog post and informed her that it was probably a bad call, public-relations-wise, to talk about people's bad breath and call them stupid. She took the blog post down and apologized, and everyone learned a valuable lesson.

Matt Davis (The CU Warrior) wrote a summary of the event on his own blog that included some key rules about "social media snafus" for CU employees organization-wide. To paraphrase/sum up:

Nothing on the Internet is private (this isn't as obvious as people think!)
Word travels fast (especially to big-time blog followers and tweeters, like Jimmy, Matt and friends)
If you're "linked-in" and a friend's slip is showing, it's probably better to let them know than to let them tarnish the image of their institution.

A week or so ago, the CU Journal ran an article, "What Not To Say On Twitter". Arizona State CU in Phoenix, under the direction of Paul Stull, started putting social media guidelines into their employee handbook. Now, some younger readers might wonder if this is "fair" and if a job can do this to its employees.

The answer to both is yes. Many businesses already have sections of their handbook and policies they've put together to keep people from doing unseemly things while on the company clock or while wearing the company clothing. They can't know everything employees doing, sure, but a company is entitled to protect its public image through its work force. That goes for your Facebook status, too.

Stull made a very realistic, very insightful point about social media - that it's growth and increasing importance in the lives of staff and management makes it impossible to ban altogether. Better to be very specific with employees about where you stand on social media, and how you expect them to conduct their public lives when it comes to the company's best interests.

Have you had to fan down the flames on a "social media snafu"? Tell us about it in the comment section - be sure to specify what you learned from it.

10 for '10: The Top 10 Branding Challenges Your Credit Union Will Face Next Year

2009-10-01T09:14:34-04:00

Paul J Lucas, national marketing and branding consultant and frequent CU Journal contributor, wanted to share some thoughts on brand management for credit unions. Visit Paul's website at pauljlucas.com,email at paul@pauljlucas.com or call (202) 320 5759 to learn more.

Going into 2010, the top brand challenges for credit unions will be:

1. Misunderstanding what a brand is and why it matters. It is important to have a brand strategy that is embraced by the entire organization. If your staff doesn't get it you can't expect your members to embrace your brand.

2. Lack of understanding in the marketplace that credit unions are ideal primary financial services providers - not just a good place to get a vehicle loan. This means that credit unions must explain both the credit union concept and their own specific brand stories.

3. Communicating that shared branching and ATM networks are competitive to the national presence of large banks. This is critical to a credit union's ability to compete against multi-branch banks (and credit unions). Yet most members have no idea what "shared branching" means or how competitive large ATM networks are compared to many large bank systems. Do not assume members know what "shared branching" means, or how to use it.

4. Bad advertising and marketing that obscure the brand and fail to communicate the credit union's benefits can erode brand value.

Your marketing/messaging must be clear, straightforward and benefits oriented.
Creative does matter - effective creative gets you noticed and it clearly states the benefits of using your CU.
All messages must be consistent building blocks for the brand: advertising; signage; brochures; newsletters; statement messages; eLerts - every member touch point.

5. Overemphasis on reaching new members at the expense of building more productive relationships with current members. Build brand loyalty inside-out! Your current members are the best prospects for increasing product and service penetration. That is key to building a successful, stable financial services organization

6. Letting impatience trump consistency. Throwing together ads, products, announcements, etc. without taking time to tie them to your brand strategy is counter-productive.

7. Constantly changing things in search of the "magic bullet." Changing offers, ad mediums, products, etc. in search of the one magic key to prosperity is a death spiral. There are no magic bullets beyond consistency and brand clarity.

8. Thinking business development reps will quickly and easily grow assets. Business development reps are only as good as they are managed and credit unions do not usually have experienced, effective sales managers on staff. Business development reps who are unskilled and untrained can do your Brand more harm than good.

9. Working with a marketing budget that is too small to achieve marketing goals. Some annual marketing budget benchmarks:

0.25% of assets at a minimum for small institutions.
0.50% for a larger SEG, near community or small market community CUs.
0.75 to 1.50% for large/urban community charter CUs.

10. Remembering that credit unions are chartered to lend money! That requires becoming a competitive retail marketer.

I'll Gladly Pay You on Tuesday...

2009-09-24T12:07:56-04:00

by Ron Daly

...for clearing my bad check today! Has overdraft protection (aka courtesy pay) seen its last days? It started with a desire to help consumers when their accounts were overdrawn. Instead of returning a non-sufficient funds item and charging a return fee on each end, some institutions began paying the check and collecting a slightly higher fee. The consumer would then repay the financial institution when their next paycheck or deposit was made.

But, as is typical, the road to ruin is paved with good intentions.

Larger banks saw the opportunity to let people drive themselves and their accounts into the red. Not only would the person be responsible for paying off all the money they'd spent (unknowingly, in some cases), they'd incur a fee for every debit on their account. Bank of America was recently raked over the coals for paying the higher dollar amounts first so that more of the smaller transactions would incur the $35 fee, According to the Associated Press, consumers pay as much as $17.5 billion every year in overdraft fees. consumers pay as much as $17.5 billion every year in overdraft fees.

A full year after the collapse of Lehman Bros., lawmakers are still looking to point fingers and tighten the vice on financial institutions. Now, congress-people like Senator Dodd and Rep. Barney Frank are working on legislation that will regulate overdraft fees. Many major banks, including Bank of America, Chase and most recently Wells Fargo, have backpedaled on their overdraft policies and have begun to offer "opt-outs" to consumers who would rather not deal with overdraft protection. Still, many believe that it's "too little, too late" and that congress will increase the laws and regulations around overdraft fees regardless of the banks' willingness to change their mind on the topic.

Some folks in the industry aren't happy with the bad rap laid on them because of overdraft fees. Dan D. Graham of Flora Bank and Trust of Illinois took the time to list out five complaints from the view of the banker. A portion of his list:

"You assert that banks let customers overdraw their accounts without their knowledge. BULL! First and foremost it is the customer’s responsibility to manage their checking account. Who else is going to know if they have money in their account besides them when they write a check? Once again though we are taking personal responsibility out of the individual’s hands, blaming someone else, and asking the government to control our lives. Can you get Senator Dodd to remind me to go to the bathroom; I’m not smart enough to do it myself?"

The debate raged on at the annual convention of the New Jersey CU League between industry leaders (read the full article here) and Jeffry Pilcher of the Financial Brand recently wrote an article, "5 ideas to fix the ugly in overdraft fees", that lays out some facts on overdraft fees and the public opinion on said fees (the public thinks they suck, no surprise). Other than making overdraft protection opt-in, Pilcher brings up balance alerts as a means of making people more aware of the money they're spending and when it's going to run out - even so far as an alert at point-of-sale.

So, the $64,000 question - What is the right stance on this? Should the industry rethink our policies on overdraft protection and change our practices, or are the practices helpful and the public should step up their money management skills with our help?

Does courtesy pay/overdraft protection help or hurt the consumer? Tell us what you think in the comments section.

We've Got our Very Own Goldmine!

2009-09-21T14:27:46-04:00

by Ron Daly

I don't have a Rolodex. I used to, but that was before it got cumbersome and Bill Gates put a contact program in whatever version of MS Outlook I'm using. For you Gen-Y folks, a Rolodex used to be the "big thing" and the thing to have if you were a businessperson. The little cards full of names that you kept on your desk so you could make calls and make deals were invaluable. They were worth a lot and salesmen were often hired based on their Rolodex, the information contained in them and who they knew.

I read an eye-opening article called "The Price of a Marketing Lead"the other day. It breaks down information gathered about a lead into "basic fields" and "premium fields". Basics fields like first name, last name, home address and email addresses are worth $.60 each. Premium fields consist of things like Twitter names and home and cell phone numbers and command up to $2.27 each. I estimate that at $.60 per lead, the 30.9 million members in the 154 credit unions over $1 billion in assets are worth approximately $18.5 million dollars to outside marketing firms.

Eureka!

I know that we don't sell member information and I'm not advocating it, but what a valuable asset we have in our possession! Why would any CU pay through the nose for pay-per-click advertising to grow their business when we have a goldmine of information at our disposal already? Read about the Facebook vs Google Click wars. The numbers quoted above are just to give you an idea of what valuable information many have locked away and are not using it. For example, why are credit unions unwilling to use an email address or place outbound phone calls to reach your members and potential members and get them into a dialogue about the value of the CU and its products and services? Everyone else is doing it.

My point is - communicating with members is constantly changing. There's real value in keeping all contact info current and using it. Gathering even more information like cell phone numbers and multiple email addresses increase the value of the asset we hold. We need to -

1) be collecting (or updating) email addresses and phone numbers at every member touch point;

2) get ready to collect and store more types of member contact information in our core systems; and

3) better use the valuable information that we have at our fingertips to grow our businesses.

It's time to take advantage of the data we have on hand.