Credit unions have always enjoyed the luxury of knowing, or at least believing, that they are special; they are nonprofit institutions dedicated to their members—seemingly an obvious and startling difference from traditional banks. Most everyone knows that Heinz is the slowest ketchup and 7-Up is the “un-cola,” but do consumers really know that credit unions are the “un-banks”? Most members we interviewed seemed to lump credit unions in with banks.
But what is a credit union? Even the words “credit union” do not seem to convey a specific meaning in modern vocabulary. For most consumers, credit is what you owe, and a union is an organization of employees formed to bargain with the employer. How does this name tell today’s consumers what credit unions are and how they differ from banks?
What is the research about?
The Filene Research Institute gave the research task of better understanding individual credit union brand identity to Larry Compeau, PhD, professor of consumer and organizational studies at Clarkson University. Compeau took a qualitative research approach whereby a small number of in-depth interviews were conducted with a variety of credit union types (single-SEG, multi- SEG, community, etc.), credit union members (age, length of membership, gender, etc.), and credit union employees (CEO, senior management, staff, etc.) across the United States.
What are the credit union implications?
Key findings from the report include:
- Members hold a strong brand identity of their individual credit union. They describe their credit union as reliable, friendly, helpful, and informative.
- Employees hold weaker perceptions of their credit union’s brand identity than their members.
- Except for long- tenure members who may have helped build their credit union, credit union members tend not to differentiate credit unions from banks.
- One point of differentiation for members is that credit unions are “a little more personal” but “not as sophisticated” as banks