NEW YORK (MainStreet) – Credit unions generally offer their members superior interest rates than consumer banks, but they fall short when it comes to marketing themselves through social networks like Twitter and Facebook.
That’s the finding of a new report by the Aite Group, a research and advisory firm. In a survey of 50 credit union executives, 60% admitted that they were “beginners” or “novices” when it comes to social media, and only 8% said that they regularly used social media tools. Smaller institutions fared particularly poorly, with 100% of credit unions with less than $100 million in total assets describing themselves as beginners or novices.
It’s an industry-wide marketing gap that’s only exacerbated the problems that credit unions have faced in communicating their value to prospective members. MainStreet’s Credit Power Index, an analysis of RateWatch data, found that credit unions consistently offer superior deposit and loan rates than banks, yet many consumers don’t realize they’re eligible for membership.
“There’s certainly a large segment of consumers that cannot elaborate on what a credit union is or isn’t,” the report’s author, Ron Shevlin, told MainStreet. “If they have an inkling of what it is, they might think it’s something that they can’t join because they’re not an employee of a given company.” The reality, though, is that most families are eligible to join multiple credit unions based solely on their place of work or residence – or even where they worship.
The surveyed executives gave several responses when asked what was keeping them from implementing social media tools as part of their marketing strategy. Most notably, more than 65% admitted that they weren’t fully convinced of the value of social media or that there would be a significant return on investment. That suggests that the same small-town mentality that makes credit unions a superior option for many consumers has also led to a sort of small-mindedness when it comes to devising a forward-thinking marketing strategy.