Milwaukee, Wisconsin -- What’s top of mind with CUs in 2018 is brand awareness, according to one design/build firm, which suggests the declining number of good merger candidates is contributing to the focus.
“Last year we surveyed many credit union leaders about numerous topics, including which tactics they would be implementing in the upcoming year,” said Ben La Macchia, vice president of planning and real estate at La Macchia Group. “We learned that the majority of these leaders want to focus on increasing brand awareness. As we delved deeper, we uncovered that many of the key drivers for growth are linked to identity. Attracting and retaining new members, technology adaptation and even pricing are influenced by a strong branded image.”
That focus on increasing awareness is coming as CUs realize growth-via-mergers is becoming less likely.
“The lower number of potential merger candidates is really starting to stand out now,” said La Macchia. “We are beginning to notice an increasing level of competition for merger candidates, along with a corresponding recognition in the need for organic growth if the merger doesn’t happen. Credit unions continue to experience high growth within their existing networks and this has created a lot of optimism. A logical move into a new market is through a merger. However, we are seeing that there remains an interest in new markets if the desired merger in the target market doesn’t happen.”
When it comes to branch expansion in 2018, La Macchia said not to expect credit unions to take a one-size-fits-all approach.
“The strategy going into 2018 continues to evolve as credit unions are learning how to fit technology and new approaches to member service into their business models,” La Macchia said. “Various levels of technology integration and success with smaller physical branches can work when deployed in a meaningful way.”
Credit union growth, pointed out La Macchia, is being impacted by concerns over regulatory compliance. But he noted the country appears to be moving toward a period of deregulation.
“Along with some of the benefits of deregulation may be the creation of non-traditional competitors. From a long-term perspective, the continued emergence of Bitcoin is another uncertainty and potential risk,” he said.
Looking five years out, La Macchia said that much of what defines the success of the company’s clients’ projects is “our ability to anticipate changes in the industry in a way that is relevant to them. The need for financial products and services continues to change, but it is not going away. Our ability to take our unique understanding of key demographic and socioeconomic factors and apply them to our clients’ business models will continue to give them a competitive advantage,” said La Macchia. “To support this, we are continuing our research and investment in information and new technologies. We are also focusing on how the retail and office landscapes are changing and how this affects our clients’ businesses from the lobby through operations.”