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Scott Adams, creator of the serial documentary “Dilbert“, invented the term “confusopoly” back in 1998. Basically, it refers to the tactic of entangling consumers through sheer confusion rather than being directly competitive.
A while back, I wrote a post detailing my finally becoming a member of a CU. I joined because I needed a Health Savings Account and this nice local credit union offered one. My bank did not.
Chris Blough (CEO of Wayne County CU) had a brilliant quote on Liquid Lunch,
“Small Credit Unions need to be like jet skis. We’re not the Titanic. A jet ski would see the iceberg.”
I’ve lost count of all the great credit union product ideas that have been strangled in their cradles because of technical limitations — “uhhhh… our system can’t do that.”
That creates a problem  – if all you have to sell is the same old products as everyone else, they’re commodities, with no differentiating features. Even worse, you’re stuck in a race to the bottom, competing on price alone. You’re letting the competition, inertia, and tradition define what your credit union can and cannot do.
“The reason it seems that price is all your customers care about is that you haven’t given them anything else to care about.” (Seth Godin)
As a consumer, if given the choice between buying what looks to be the same product from two different sources, you would choose the one with a lower cost, right? You probably switch brands of tissues or aspirin or dish soap to whatever is on sale at the store this week without even thinking much about it. You have no real investment in one particular brand because they all seem about the same. They are simply commodities.
Constantly promoting lower rates and off-the-shelf products have turned most financial institutions into little Walmarts. How, you may ask?
Walmart has changed how consumers perceive a good deal. From how products are packaged and presented, to where they are made, everything is negotiable because cost is King. In order to keep it on the shelf, manufacturers have had to lose the box, change the shape, increase the volume, cut the price, and become a commodity. And it has obviously worked, since Walmart is the largest retailer in the USA, Mexico and Canada, and 93% of American households shop at least once a year there. Walmart has been able to change our concept of what something should cost, and as a result, consumers have gotten used to the idea of paying less yet buying more.
“Maybe the reason it seems that price is all your customers care about is that you haven’t given them anything else to care about.”
-Seth Godin
I always find it interesting the kinds of answers you get when you ask people what makes a credit union different. It usually comes down to something about having better service and better rates (infer…than banks).
Here’s another video…
Perhaps it was fitting that the first speaker of the CUNA Marketing & Business Development Council Conference in Washington DC was David Plouffe, Campaign Manager for Barrack Obama’s historical presidential campaign. The way that campaign threw out the rulebook and leveraged the masses is the stuff legends are made of. Â And the parallels between that campaign and the history that could be made by CUs right now give me chills. Â Here is what I took away from his speech:
It’s the last evening of the CUNA Marketing & Business Development Council Conference in Washington, DC and I’ll admit I’m a little sad. I look forward to this event each year like a kid does Christmas morning. It’s a reunion of old friends, a powerful exchange of ideas, and an undercurrent of energy that’s absolutely contagious. I experience it every year when 300 passionate Credit Union Marketers assemble to share and celebrate what makes this movement great.
When you think about it, credit unions are one of the rarest types of organizations — outside of being self-sufficient, they have absolutely no purpose other than making things better for the people around them. Whatever you call it — Goodness, Quality, Grooviness, or Positive Mojo — credit unions sure do manufacture a lot of it.
Over the past several years, more and more credit unions have eliminated certain words from their marketing and identity. Words like “member”, “join” and even “credit union” are now taboo in a lot of places, and internet account access is almost always called “home banking.” And when was the last time you heard “share draft”?
Remember those Kraft Macaroni and Cheese commercials a while back, where kids exclaimed “It’s more cheesier”? I cringed every time I heard this phrase, and so did thousands of other writers and English majors.
We’ve had a remarkable stretch of cold and regular snow here in Indy the last few weeks, so I’ve been forced to drive to work instead of riding a motorcycle. Being stuck inside a “cage” is pretty rough for me, but at least I can listen to the radio. I even pay attention to the commercials, mostly out of professional interest.
Earlier in the week I had the great pleasure of cohosting the CU Later 2009: Roasts and Toasts blog radio show with Denise Wymore and Christopher Morris. We roasted and toasted the best and worst of 2009.
If there is anything that the last year has taught us it’s that we are vulnerable to greater forces around us. The fundamental laws of nature require that organisms and organizations alike adapt to survive.