Tech Time: Slow and Steady Wins the Digital Transformation Race

One of the most important but intimidating challenges credit unions face today is figuring out how to achieve so-called “digital transformation” by extending and enhancing their presence through technology. 

But wholesale adoption of the sudden, radical changes that transformation implies is often the worst approach a credit union can take. That’s because when a business model has been as successful as the credit union vision of pairing outstanding value and member experience, saying it needs transforming is like telling a butterfly it was better off as a caterpillar. 

Pursuing a Strategy of Digital Evolution 

So how can credit unions embrace the best of digital transformation without falling prey to the confusion and headaches that result from trying to do too much too soon? Here at PSCU, we think that a strategy of “digital evolution” represents the best way to leverage the potential of digital tools to do more of what’s already working well. 

Our mantra for implementing digital evolution is common sense and time-honored: “If it ain’t broke, don’t fix it.” Credit unions can take that advice to heart by steering clear of vendors that want to sell them expensive bells and whistles, as well as consultants suggesting strategies that aren’t a good fit. 

The digital evolution mindset puts technology to work helping credit unions better serve each member as a “market of one.” 

4 Key Areas for Digital Evolution

Guided by that mindset, let’s explore four areas where digital techniques and tools are helping today’s credit unions stay true to their roots while evolving to serve their members better:

1. Brand identity: All credit unions share a core mission and set of values, but the alchemy that fuses a particular credit union, its marketplace and its members to create a brand identity is completely unique. Most credit unions today already understand the power of such digital tools as websites and email marketing to craft and communicate those brand identities. 

Consider these next steps in your credit union’s digital branding evolution:

• Build a social media presence that includes Facebook/Instagram, video and a blog.
• Maximize feedback on the effectiveness of your website using tracking analytics.
• Create coded landing pages to track which ads are connecting best with members and prospects.
• Consider creating an app, branding a chatbot or developing an Alexa skill to report useful information or perform simple actions for members.

2. Analytics: Analytics are the way credit unions “listen” to their members so they can develop products, solutions and delivery channels that meet member needs. To compete on today’s digital playing field, there’s no such thing as having too many analytics, but there is definitely such a thing as drowning in data. If your credit union doesn’t have many analytics resources, start small—no matter how tempting it might be to cast a wider net—and always designate an owner for any analytics project you start. 

Next steps to consider in your credit union’s digital analytics evolution:

• Designate someone to track website, social media and email marketing engagement to determine what’s working and what isn’t.
• Use web analytics to determine if your site visitors are going where you want them to go. If not, recruit some user experience testers, watch what they do and refine your website navigation accordingly.
• Dip a toe into the personalization and predictive analytics waters with customized product suggestions or personal website greetings. 

3. Marketing and advertising: Charles Dickens didn’t write, “It was the best of times, it was the worst of times,” about digital marketing and advertising, but he easily could have. It’s often tough, even for experts, to make sense of metrics like impressions, page views or social media likes. On the other hand, a little-known fact is that the search giants, especially Google, will bend over backward to help your credit union create—and track—effective, geo-targeted ad campaigns to fit your budget. 

Next steps to consider in your credit union’s digital marketing and advertising evolution:

• Be on the lookout for opportunities to evaluate which of two marketing alternatives performs better—for example, tracking the responses to different advertising formats or analyzing the acceptance rate for an online credit card offer compared with that for direct mail.
• Take advantage of digital marketing’s ability to target, target, target. If you think that retired females who live in the suburbs of Chicago and own Labrador retrievers but hate cats would make good prospects, digital marketing makes it possible to identify and reach out to them.

4. Financial analysis and ROI: Because digital tools are data-driven, they can be decision-making game changers for CFOs, too. Tools can be deployed to boost call center productivity, create dynamic dashboards and data visualizations, run real-time financial models and calculate marketing ROI.
 
Next steps to consider in your credit union’s digital financial analysis evolution:

• Integrate digital financial modeling tools into your strategic planning process to assess risk and set more accurate growth targets. 
• Use digital dashboards to track the relative contributions of different channels and branches in marketing campaigns. 
• Investigate ways that digital financial tools can be used to fine-tune card program features such as rewards and risk-based pricing.

Taking the Incremental Approach

Writing in the sixth century B.C., Chinese philosopher Lao Tzu had some advice that remains timely for modern credit unions: “The journey of a thousand miles begins with a single step.” Using an incremental digital evolution approach, today’s credit unions can both delight their members and reach their digital destinations. 

Arnie Goldberg is VP/principal/business development for Advisors Plus, St. Petersburg, Fla., PSCU’s independent consulting group. Goldberg draws on more than 30 years of consulting, CRM, payments and funds transfer expertise to help credit unions achieve innovative, measurable improvements to their products, operations and profitability.