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32 posts categorized "Technology"

April 18, 2014

Love, e-Merican Style!

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by Ron Daly

Loveemerican

Ahh, love. There's nothing like it in the world. Boy meets girl, boy loses girl, boy goes online to find a new girl, boy meets girl online, boy marries girl online, boy decides it was a doomed relationship from the start and gets divorced online...

Tale as old as time.

"BUT WAIT!" you cry, "You can't get married online, and you certainly can't get divorced online."

Well, I'm here to prove you wrong. Welcome to: 

LOVE, e-MERICAN STYLE! (You can write your own fancy theme music in your head.)

Americans are living their lives online, there's no two ways about it. It takes a certain degree of Internet obsession not only to date online (through eHarmony, Match.com, or any of the dating apps out there), but to get married online. 

There are only a few states in which you can be legally married online, but the posibility exists. A little money, a little wi-fi, an officiant and a Skype-kiss and bing bang boom...you're married. Typically this happens for religious reasons or for troops stationed overseas, but imagine what will happen when the e-Dating set gets hold of this idea. No muss, no fuss, and a heck of a lot cheaper than an actual wedding? It's a great idea. And all your registries can be on Amazon...

So you already took the plunge and it's five years later. The bloom is off the rose. Your once fiery passion you celebrated over the glow of your iPhone has fizzled. What do you do? Well, you already got an online marriage...maybe you need an online divorce.

WeVorce is a San Francisco-based startup that focuses on speeding unhappy couples through the divorce process. Run by a divorced husband/wife couple (no, this isn't The Onion, this is a real company), the goal is to save couples time, money, and the acrimony that often comes with a drawn-out court battle. 

"The average cost of a divorce in this country is $27,000. The average cost of Wevorce is $10,000," according to [Michelle] Crosby[, Founder and CEO]."

WeVorce is already helping couples who are seeking to separate. If Crosby's math is correct and a couple really does get divorced every thirteen seconds in this country, the company will surely see a steady stream of clients in the future.

Tie the Knot? Cut the Knot? Why Not?

I know I'm poking fun, but let me play Devil's Advocate here for just a minute. Let's say you really do want to get married online. If you have witnesses on either end and live where a wedding of that nature can happen, why not? Let's say you want to get divorced but you don't have a ton of money and you don't want to make it a huge production that upsets your family more than needed. Well, why not?

Why not just make it happen online?

It's the drum I've been beating for fourteen years now. If you can make things more efficient and less painful through digital means,  why wouldn't you? Sure, a big, fancy wedding is more fun than an online wedding. But if it's not practical or you don't really want it, why not go online? If you just want to break up and go on with your lives, why not use an online divorce service? If you want to do your banking simply or examine your finances or save your important files, why not use eServices to get it all done?

It's only when we accept that we don't have to have physical contact for these things that we start to overcome our sentimental attachment to the excess associated with them. We get more done and move on with our lives. And that, my friends, is...

LOVE, e-MERICAN STYLE!

March 14, 2014

The Devil, the Details and You.

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by Ron Daly

I was cruising through LinkedIn and saw this post from CU Grow, posted with the intriguing snippet: 

"Let’s be honest, a CEO most likely does not care about the details of the creative as they are more interested in the outcome and value the results of the creative provide."

As a CEO myself, I had to chew that over. Yes, I care about the creative details - I'd like to know they're on-brand and well-done and useful. No, I don't care about every detail - I have to differ creative choices to the creatives I pay to...well, create.

The article is all about KPI's - Key Performance Indicators. What makes a campaign successful? Is it the number of people that click? Is it view/play counts? Is it downloads? 

Chances are, none of these metrics tell you much on their own. Click-throughs matter, but only in the interest of finding how many people bought something on the other end. Views and play counts are nice, but how many of those views can you trace back to a loan offered or a problem solved?  How many downloads of your white paper got you another conversation?  "The Devil's in the Details," they say, and while I don't think you have to be the devil to see how your virtual branch is managing visitors, I think it is important to keep the big picture in focus.

I like the article I read. I like knowing that our online initiatives reduce acquisition costs, boost profitability, and improve operational efficiencies. And I really love seeing all of that happen, start to finish, through the analytics. That's why I like to look at the following pieces of information for any campaign done online: 

1. Campaign Sources - This is an obvious one. I like both a macro- and micro-view of the campaigns because I want to know more about what's working. Are banner ads outperforming email for a certain campaign? What target audience responds best to webinars? In a given email campaign, how far did clickthrough-visitors go in pursuit of information? Which leads me to info-point two:

2. Time Spent and Visit Depth - Of the people that came in from any given campaign source, how long did they stick around and how much reading did they do? Did they download anything? Did they sign up for a webinar? 

3. Where's This Going? - I want to be able to compare the products we're promoting against the page visits for those products. As much as possible, I want to know what brought users to those pages and how much each clickthrough cost.

4. Drawing the Line - For each lead we get, I'd like to be able to draw a line from one point to the next in the road to their admission as a lead. Is this a client? Is this a prospect? Is this a potential partner? What brought them in, what did it cost us, and what's our next step in bringing them on board?

Hopefully these are good guidelines for you as well. All of this information is pretty easy to ascertain if your analytics are correctly set up and you have a good grasp on your costs. As you dig in on your reports and results, ask yourself an even bigger question: "what might change?" As Brent Dixon discussed in his most recent CU Water Cooler post, there are many things to consider when you're looking at one end result. In most cases, you can't point to a single root cause of any effect. Consider everything and try to think of your marketing campaigns (and your department) as a system. How does one piece affect another? Can something be changed to improve overall performance?

The devil's in the details but finding out how each arm of your marketing plan is working with the others is heavenly.

January 28, 2014

The State of Credit Unions in 2014, As Predicted by The "Crystal Ball" of Google

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by Ron Daly

Let's face it - Googling stuff is fun. It has been from the very beginning and it's still a hoot.

Sometimes, Google can show you the future. I decided to put Google's "crystal ball" capabilities to the test and see what 2014 had in store for the industry. I simply put

  • "In 2014, credit unions will *"
  • "In 2014, credit unions must *"
  • "In 2014, credit unions should *"

into the search bar and hit return. And voila! all the interesting tidbits about what the industry should focus on this year. Some highlights: 

"[Credit Unions] must focus on enhancing members’ cross-channel experiences, says Belinda Caillouet, chair of the CUNA Technology Council..."

"Charting Your Course Through 2014", creditunionsmagazine.com

Agreed. Members are leaning hard on technology and demanding more channels that work well with one another. That includes mobile apps, online banking and ATM/branch services that all play well together and stay up-to-date and easy-to-use.

"Financial marketers will be accountable for analyzing the real results of content marketing strategies in 2014. Because every channel ultimately affects all of the others, attribution modeling allows marketers to credit a specific ad or touch point along a sales funnel rather than just the last material viewed or clicked."

"Digital Marketing Trends for Banks and Credit Unions in 2014", TheFinancialBrand.com

Yep, right on the money. The technology we're using to sell to members is getting better and we can start making sense of data and offering products and services that make the most sense for each individual member.

“In the next 12 months, mobile will overtake online in terms of number of users. It already has more transactions."

"5 Mobile Trends to Watch in 2014", cutimes.com

I'll be interested to see the outcome of this one. Mobile's a big part of people's lives, but can credit unions rise to that challenge and create great mobile app experiences in the space of a year? A year, mind you, that's already down to eleven months as of Saturday of this week?

"In 2014, the trusted role of banks and credit unions as the collector of funds, provider of loans, processor of payments and advisor of financial relationships will continue to come under fire from non-traditional players including new financial organizations (neobanks), hardware providers, third party payment processors, and mobile app developers that merchants and consumers are using to chip away at the traditional financial services model."

"Top Ten Banking Trends for 2014", bai.org

More sharks in a still-pretty-small tank? This is the moment CUs have been waiting for — the moment to set themselves apart from the upstarts and prove they can be valued, trusted financial partners by offering sensible services and can't-be-beat member interactions.

"To experience loan growth in 2014, credit unions will need to originate significantly more consumer loans to offset the expected declines in mortgage originations."

"Marketing Overview and Data Report", catalyststrategic.org

I'm really curious about what kinds of loans credit unions will be promoting in place of mortgages (assuming they cut back on mortgage promotions, which some won't). Credit cards? Student loans? Where's the "heat" in lending in 2014?

“Looking ahead to 2014, credit unions can expect to see the CFPB expand its fair lending focus,” said Bundy. “The CFPB’s regulatory agenda unmistakably signals that fair lending will be a focal point of new rule making starting in 2014.”

"CUNA Mutual Group Anticipates Broader Regulatory Focus in 2014", cunamutual.com

"...The CFPB has the luxury in 2014 to move on to topics other than mortgages, such as overdraft, prepaid cards, Reg CC disclosures, and debt collection. To keep track of all of it, take advantage of various resources out there—besides NAFCU, and the CFPB, many law firms have compliance blogs and news alerts you can subscribe to for free. Knowledge is power, so grab on!"

"Credit union industry experts: What’s in store for 2014", cuinsight.com

I bundled those together for a reason: the CFPB will be stepping up its game in 2014. Credit unions will need to arm themselves with information, as mentioned in the second story. There are plenty of great resources out there, both free and paid.

Any other big predictions for this year? Leave them in the comments section.

December 20, 2013

The Gifts You Give in Seconds are the Best Gifts of All

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by Ron Daly

Uh-oh, gang. I forgot to get a few gifts this year. Which is to say, all of them.

That's right, I took my own advice, skipped Black Friday, and didn't get a single present for anyone on my gift list. What on earth should I do now?!

I got it. I'll give them the Internet.

Well, no, not "the Internet". I'm just going to give my friends something digital instead of something physical. It's easier than ever to give someone a thoughtful gift that needs no wrapping, no exchanging and no batteries.

Let's start with...

• My Favorite TV Junkie: 

For the couch potato who has everything, here's a gift subscription to Netflix. Now they can watch TV all day long from any device or from the comfort of their living room.

• My Friend, The Frequent Flier:

I have friends that love to travel. Several airlines will let you buy miles for someone else. Even if you can't give them a full trip, you can take the sting out of their next outing by giving them a few thousand miles for a reasonable price.

• My Cousin, the Shop-aholic:

There are plenty of people, like my cousin, who thrill at the act of shopping more than the actual gifts on the other end. For her, an Amazon Gift Card that is applied automatically. She can shop til she drops, and in seconds.

• My Friend "Forgetful Frida"

Poor, poor Frida. She can't remember anything! That's why I treated her to Evernote Premium, a service that saves web pages, articles and images in a snap from your iPad, computer or phone. Hopefully she can use it to remember my gift.

• My neighbor, who's still not a credit union member

The poor guy...he just won't get with it! Fortunately, my credit union is offering a "refer a friend" program that gives me a bonus when he signs up. I'm adding a member to my credit union, getting $10 and helping a friend. It's a three-for-one!

• For Anyone, and For a Good Cause

This time of year, I think about our soldiers a lot. Even after they get home, they often need our help to recover, readjust and move forward. If you want to give a gift that will benefit the giver, the recipient, and a veteran, consider giving a gift to the Wounded Warrior Project. Use this form to give a gift in someone's name to this very worthy cause.

Phew! Now that my shopping's all taken care of, I can get back to my favorite holiday pastime: putting up my inflatable lawn ornaments and showing up my neighbors for our block's Christmas decoration content.

Merry Christmas from the CU Soapbox!

April 24, 2013

Step Right Up! Test Your Twitter Password!

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by Ron Daly 

Yesterday, the Twitter account of the Associated Press was hacked and a misleading tweet was posted, claiming that the White House and the President had been attacked. This, of course, was not true. But the damage was. Oh, yes it was. The stock market dipped ferociously, then self-corrected when it was determined that the claim was false. Twitter went crazy; first, with fear, then with ridicule of the AP, an organization that is assuredly licking its wounds as of this writing. 

Now, let's abstract this. What if it were your CU's Twitter account? What if someone "hacked" that account (we'll get to the term "hacked" in a minute), and sent a message to all your followers that told them your CU was going out of business, or that a branch had been robbed? Imagine the blow-back. 

Luckily, there's a website to test the security of your Twitter password. It's called IsYourTwitterPasswordSecure.com. Try it out! Go on, I'll wait. Come back when you're done. 

Continue reading "Step Right Up! Test Your Twitter Password!" »

March 20, 2013

eManners: What Does "Polite" Look Like Nowadays?

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by Ron Daly 

It's always interesting to read an article that challenges convention, then see the blow-back from that article, then see the author's response to the blow-back. With so much media to manage these days, conversations and commentary come out of the woodwork. If they don't reply on your blog, they'll reply on their blog. Or on Twitter. Or on Facebook. Or by phone. Or right up in your face. 

Take, for instance, this opinion piece by Nick Bilton in the New York Times. It's a piece that rails against the "Thank You!" email, the voice mail where a text message should go, the use of friends to answer a question that's made for Google. 

Really, who sends an e-mail or text message that just says “Thank you”? Who leaves a voice mail message when you don’t answer, rather than texting you? Who asks for a fact easily found on Google?

Don’t these people realize that they’re wasting your time?

As you might expect, the lament of a 36-year-old super-geek didn't sit well with readers, many of whom are from a generation removed - one that emphasized penmanship, greeting cards and always saying "please" and "thank you". 

Do I really care about "Thank You" emails? No, not really. They're nice to get, and if they have more information or want to continue a conversation, why not? But I'm not going to lose sleep, nor should anyone looking for a reply from me be upset if I just move forward with the next steps after I get an email with an "action item". 

Bilton again, with a worthwhile consideration: 

How to handle these differing standards? Easy: think of your audience. Some people, especially older ones, appreciate a thank-you message. Others, like me, want no reply. “It is important to think about who the relationship is with,” Mr. [Daniel Post] Senning said.

Audience, audience, audience. The number one consideration in marketing, business, sales, collections, consultations, etc. You have to remember to whom you're talking. 

Based on the reactions he got, you might think Mr. Bilton hasn't considered his audience's reaction. Spoiler alert: they got mad. They called Bilton a "sociopath" (no, really), irrational, impatient, sad...they really didn't like the idea that he didn't want to talk to his mother directly, but rather via Twitter. Bilton later explained that his mother lives in England and, as a San Francisco resident, he couldn't call her at any hour that was convenient for both of them, so they rely on Twitter to fill in the gaps. He talks about how he does, in fact, hand-write thank you notes to friends and relations. But too late - the audience had made up their minds.

Bilton says he doesn't mind being "the punching bag" for people his age. He did lament, however, the extremes people go to when they react to something they don't like. They talk about how disgustingly disconnected from reality he must be to dislike a "thank you" message. Bilton replies that the stewards of Emily Post's legacy of good manners insist that, yes, you should consider the audience when crafting a reply. Some people will love a "thanks!", some won't. Some people will want a voice mail, some will just delete it. 

And then Bilton made a really terrific point about who trains whom in our culture. It used to be that older people taught younger people everything. As technology advances and people develop skills at different ages, it's clear that education moves in two directions: up and down the years, each generation having something to offer the other. 

I had to learn to text if I wanted to get an answer to a simple question out of my kids. My younger employees come to me if they want my input about business or finance. We have many ways of communicating and we all have things we need to get done, so we all have to adjust our methods from time to time to make it work. 

Now...let's talk about "what you've always done" and member communication. 

The truth is, things change. People want to converse and conduct business in different ways, and the methods they use are changing all the time. But in embracing changes, consider the audience's reaction to your messages. Maybe one group really loves hearing from you every month. Maybe one group wants a phone call every once in a while. Maybe there are outliers - people who have adopted new ways of handling all of their inputs and have rolled with the changes. 

Pay attention. Knowing how to talk to people is critical to a credit union marketer/manager's livelihood. Knowing when to say something and what to say is so important, and just as important, knowing when to quit talking and let people get back to their lives. 

My Pet Peeve: When you use an online chat or a toll-free line for customer support and people keep pushing the script on you when you've made it very clear that you're done. 

Me: "Well, thank you, that's all."

Them: "Okay, Mr. Daly, is there anything else I can help you with today?"

Me (in my brain): "Are you not listening? Or are you just forced to do this, like a robot?"

Me: "No, that's it."

Them: "Okay, thank you for calling our help line. You can reach us online any time at www..."

Me (in my brain again): "Come ON, just say goodbye and hang up the phone."

I like dealing with people, not people ordered to act like a computer. Here's my dream customer service call.

Me: "Well, thank you, that's all I needed."

Them: "Okay, Mr. Daly. Have a good afternoon."

Me: "Okay, bye!"

I've had maybe three of these calls in my life. And I make a lot of calls. 

All it takes is a little listening. People unsubscribe from your newsletter? Fine, but make a note of that. Don't chalk it up as "this person's not interested"...find a way into their lives that works for them and you. It exists, I'm sure. 

And when they talk, listen. And when they reply, read it thoroughly. And when they care, you should care, too. 

Don't let technology fool you into thinking that etiquette and thoughtfulness don't mean anything, to any given age group. Treat members with respect and you'll earn theirs. 

And for what it's worth? You should call your mom on the phone. Unless she's totally into Facebook now. 

February 15, 2013

Conventional Wisdom Vs. Real, Actual Wisdom

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by Ron Daly

There's what people know, and then there's what people "know". 

And whaddayaknow? Typically, they're complete opposites. 

 You see, there's "conventional wisdom" - what people think they know based on their personal experience - and then there's "real, actual wisdom". "Real, actual wisdom" typically shows up in the form of unbiased research with clear results. Is it more "trusted"? No, not likely, because nobody wants to feel like they're wrong. But it is a reflection of the truth. 

What got me going on all this is a recent Nielsen Group study on teens and technology. Now, "conventional wisdom" tells us that teens are wired and great with technology. What does the "real, actual wisdom" tell us? 

Teens are not technowizards who surf the web with abandon. And they don’t like sites laden with glitzy, blinking graphics. Teens are often stereotyped as only wanting things that are bold and different. They’re also often viewed as being fearless about technology and constantly connected to some form of media. Although this might be partially true, it’s an oversimplification and letting this steer your design can lead to disastrous outcomes.

The study Nielsen conducted focused on the ability of teenagers to gather information and see a process through online. What did the study find? That teens had poor patience and attention spans, poor reading skills, and bad research methods. They weren't as good at finding the info and making the right decisions based on what they found. 

The study goes on to talk about what works with teens and what fails. What works?

  • Smart, concise writing
  • Large, readable fonts and big images (to compensate for small screens)
  • Self-selecting social and email (yes, email) options. 

Wait, that sounds like a list of things older users would like!

Not to sound like a teen, but...DUH. 

Who doesn't like reading things that are easy to understand? Who doesn't like a website that's built large enough to read and use? Who doesn't like to have the option to not socialize every single online interaction? 

A little research goes a long way. For a while, when I would describe our newest product, My Virtual StrongBox, the people I talked to would tell me that their older users wouldn't like it. After pulling demographic information for  My Virtual StrongBox's users, we discovered that use was highest among ages 30-39, and second highest – yep, you guessed it – among users in their 40s and 50s. "Conventional wisdom" made it seem like a product built for Gen-Y. "Real, actual wisdom" proved the real market had a touch of gray. 

Long story short? Take the time to ask, to record, to report, to study – to really, truly know.

Then, act.

February 07, 2013

The Pocket Merger: Your Phone is Becoming Your Wallet. Will Your CU Be Prepared?

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by Ron Daly 

I'm an iPhone guy. When most of my peers were pecking away at a Blackberry hard-key, I was tapping and swiping my touchscreen wonder-phone. I'm currently working with an iPhone 4s, having bequeathed my old phone to one of my kids (who dropped her iPhone and shattered the screen). 

As someone who sits watching at the cross section of technology and finance, I'm fascinated by the idea of the "mobile wallet". I read a little more about it every day and, despite all my reading, I'm not quite sure what to think. Yes, interest is growing, but it's still small. Yes, the tech advancements are impressive, but also scattered between the people who were already handling payments (Visa, Mastercard and the like) and the start-ups (or is it "upstarts"?) out to stake their claim (Paypal, Square, Isis). Cheap, plastic doodads jut out of your phone that let you physically swipe a credit card with your smart phone. Suddenly, your smart phone's a wallet AND a cash register.

And a bank account? Time will tell, I suppose, if the merger between your phone and your wallet puts CUs at risk.

I pulled a few recent articles about the topic that I think are worth reading: 

Mobile Monday: Square Wallet Provides a Sneak Peek at the Future of Proximity Payment (Jim Bruene, NetBanker, full story here)

"And all your previous transactions, with full itemized receipts, are available within the Square app... It's truly the future of payments available for a sneak peek today. I highly recommend giving the Square Wallet a try."

Are Bankers Ready for The Bank 3.0 Reality? (Jim Marous, JD Power Banking Blog, full story here)

"[Quote from Brett King] The problem is that there are so many start-ups in the financial services and payments space that are impacting the way people view financial services that significant technology projects need to be undertaken by traditional banks just to keep pace. Investing in a technology layer, combined with the new costs of compliance, will be a challenge for smaller institutions. That doesn’t eliminate the potential for smaller organizations to collaborate or to build partnerships to respond to market realities, but I don’t see this happening."

Will You Be Ready When Mobile Wallets Turn Banking Upside Down? (Jeffry Pilcher, The Financial Brand, full story here)

"No matter what consumers today say they think of mobile wallets today, mobile wallets will triumph. Why? Because mobile wallets will simplify consumers’ lives in very personal and relevant ways. For starters, they eliminate the nuisance of thick, cluttered wallets. They also reduce the transmission of germs, because they eliminate  plastic cards, pens/signatures, touchscreens and keypads."

Mobility Matters: The Mobile Wallet Wars (Robert McGarvey, cutimes.com, full story here)

"If you are skeptical about digital wallets know that the skeptics may outnumber believers, at least among financial services executives. Forward motion towards wider wallet adoption has seemingly gotten just about nowhere in the past year. Few consumers have ever used one, few mobile devices have a digital wallet capability, and not many more retailers are equipped to accept them anyway.

But ask the experts and their advice is consistent: ignore digital wallets at your own risk because they are the future.

That clock is ticking."

Stop Spewing Mobile Wallet BS (The irrepressible Ron Shevlin, at Snarketing 2.0; full story here)

"If I've learned anything about doing consumer research it’s this: You can’t ask consumers their opinions about things that they don’t know. So, feel free to publicize your research about which mobile wallets are most popular with consumers, if you want, but I’m not buying any of it."

What are your feelings on the topic? Are you eager to pay for things with your smartphone? Think it's trouble brewing? Tell us more in the comments. 

January 29, 2013

A Penny Saved is…Still Not Enough to Save the Post Office

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by Ron Daly 

Well, my plan to invest my retirement in forever stamps is paying off nicely.

Yesterday, the United States Postal Service increased the price of a stamp to $0.46. The rest of the postage prices jumped, too, but it's good news if you've got a bunch of forever stamps sitting around - they're gaining value all the time. 

The USPS has the right idea - postage prices should increase, considering the fact that letter volume's dropping the way it is (heading to about 150 billion pieces of mail - seems like a lot, but that's actually waaaay down). And, lest we forget, the post office is bleeding about $25 million every day according to the postmaster general. Some estimate they'll be out of money and out of service in the next six months to a year. Will a penny more per mailed letter really save them? No, but it's better than standing still. 

Wait a minute, Mr. Postman...

In 2006, the USPS turned a $900 million dollar profit - yeah, you read that correctly. A profit. Hard to believe about an organization that in 2012 lost $16 billion. Where's all that money going? Is the sharp drop-off in mail volume to blame? Is it all the Postal Service's fault?

No, it isn't. As with just about everything these days, you can blame Congress. 

See, 2006 was the year Congress passed a law requiring the USPS to fund pensions through the next 75 years. I can tell you, this is unheard of in business - nobody's shoring up that much cash to pay employee pensions. Nobody. It's suspected that $11 billion of that $16 billion lost in 2012 went to pension funds and labor. Add to that the fact that mail volume's dropping off and Congress has been inflexible on the idea of killing off Saturday delivery (a measure that could save the USPS about $2 billion annually), the USPS has been fighting with one hand tied behind its back.

So, what's the solution?

There are plenty of people nationwide who are eager to see the post office saved for future generations. This Esquire article goes in-depth about the problem's the USPS is facing and how a complete dissolution of the entire postal service would be a blow to the American way of life. There's a new petition on WhiteHouse.gov to "save the postal service". But how to save it?

One possible way out? Undo the curse of the pre-funded pensions and let the money in that fund be dispersed to the post offices and carriers that need it. But that would require Congress's action in undoing what's been done. 

Congress? Action? Hmm...what's our other option? 

Oh, right...a taxpayer funded bailout. Taxpayers would fund the pension program and alleviate the post office's responsibilities. 

Feel like bailing out one more industry that can't handle the future? 

And speaking of the future...how bad off would USPS retirees be without the pensions in question? 

Not that bad, says Jen Wieczner at SmartMoney

Despite the Postal Service's debt, its retiree benefit coffers are beyond full. Its pension funds are more than 100% funded, compared with 42% for all federal pension funds and 80% for the average Fortune 1000 pension plan. That "astonishingly high figure," according to Williams, amounts to a "war chest" of resources that will take care of older workers for decades to come. 

So either way, it comes down to Congress. Keep your eyes peeled, there'll be a brouhaha on the Hill about all this, likely before the summer rolls in.

And in the meantime, what should you be doing, oh weary credit union marketer? 

The Broken Window Problem

You might be thinking, "yes, let's save the post office - we'll send out more mail!" It turns into the old Broken Window Fallacy - someone breaks a window, the window gets replaced for a certain cost, everyone starts a window repair business, and then all of a sudden...no broken windows. So what do people do? Start breaking windows to save the window repair businesses. 

It's wasteful and stupid. And so is trying to inject more mail into a beleaguered system because you feel bad about its shortcomings. When Western Union announced it would stop delivering telegrams, where did all the protests occur? Where was the petition saying an outmoded form of communication must be saved? 

I like my postal carrier. I like getting a letter every so often. But I don't walk around with 400 pieces of mail in my pocket every day. I do walk around with a small, touch screen computer that manages all my email, sends me text messages and even places phone calls. 

Now, let's look at credit unions. In a time when many CUs are closing their doors or getting merged, who can afford to overlook the significant cost savings that come from online banking, online account opening, eStatements, electronic bill pay, debit cards...the list goes on, but I get the sense I'm not telling you anything new. 

We started  DigitalMailer 13 years ago because we knew that the two things credit unions really want (operationally speaking) are to A) generate revenue and B) cut costs. You can't do that when you're chained to the giant rock of printing and postage. We've delivered close to 60 million eStatements over the years. At $0.46 saved per eStatement, that's $27.6 million that would go out of the pocket of the Post Office (sorry we're not sorry) and back into the pockets of the credit unions we serve. We've created products like One-Click Enrollment to help make that transition easy, and most eStatement converts never look back. Promoting education and organization to members through online account and document management is part of the greater mission of credit unions.

Heed that call and stop worrying about whether or not the Postal Service can survive. It'll take a fight with Congress, but it can be done. And even when it is, don't be surprised if the USPS still cries foul at the drop in volume. They had the chance to latch on to emerging technologies and ignored it, favoring the old ways instead of a new path to profitability. They didn't take it. 

Time for you to consider that new path for yourself. We're famous for avoiding bailouts. 

As for me, I hope postage jumps to $1 - my all-forever-stamp portfolio is looking better and better.

January 23, 2013

People Are Lending Directly to One Another…So What Are We Doing Here?

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by Ron Daly 

Today on CreditUnions.com, I was drawn to an article titled "Beyond the Home Loan: What can credit unions learn from online crowdfunding platforms?" [Here's the Full Article.]

While the article doesn't spell out the overall lessons, there are a handful of examples. Good enough, I suppose, because it got me thinking - what are we missing? 

Credit unions, as best I understand them (and after 30+ years in the business, I can honeslty say I do), were created to give members a way to lend to and borrow from one another. They were created as an alternative to the system. Now, for consumers, it seems like we're just another part of that "system". 

Bank customers and credit union members know that good loans go to good paper. If you're trying to buy a home or a car and you have a good credit score, you won't need to look for too long to get what you need. But if what you're trying to do is create a movie about Linotype machines or start a small business selling weirdly-shaped candles, you'll likely go wanting. And for the people who have rough credit, quick, high-interest loans with fewer strings mean more than "relationships" with a bank or credit union. 

As far as peer-to-peer finance and technology goes, you're crazy if you don't go read "A Game of Leapfrog" by Brent Dixon. 

From the article, originally published on the CU Watercooler

But meanwhile, many credit unions still don't even offer online account opening. We're saddled by regulations. We're a weighty, slow-moving beast. We make excuses.

Consumer finance is not just begging for disruption, it's experiencing it. In a few short years, many traditional institutions will be passed over. Leapfrogged. It's easier to build than reform, and people are building.

So, what can credit unions learn from peer-to-peer finance today?

  1. Time to Re-evaluate the "People Helping People" Message -

    Everyone I talk to in the industry loves that phrase, but how many credit unions are interested in the proof of it? When a person lends to Kickstarter, they get a "thank you" in the form of a gift - maybe a version of the product the borrower is developing or a branded package of swag with the up-and-coming product or company logo. What's the "thank you" gift new members get at your credit union? A letter? A free pen? 

    Better yet, where are the booklets and brochures with member success stories? Show me the story of a member who joined and went from broke to flush thanks to the credit union. Show me the small businesses that have benefited from the CU's guidance. Those stories have got to be there. Otherwise, my fees and interest are going toward nothing, as far as I can tell.

  2.  Partner Big, Lend Small

    According to the CreditUnions.com article above, services such as Kiva and Fundly use proven tech platforms like Paypal and Amazon to process payments and securely move money to and from borrowers and lenders.  Why can't credit unions partner with tech providers for everything they need - better online banking and account opening, smart phone apps, tracking of the loan process, etc.?

    It's not that they can't, it's typically that they won't...or don't want to. Even when vendors provide all the due-dilligence and proven testimonials and case studies, credit unions will still look for ways to doubt results. Who does that help? Not the member, certainly, and not the loan portfolio.

    And look at the amounts certain people are requesting - $300? $500? They'll go to a payday lender before they walk through your front door, how is that a good thing? It's not because the money isn't expensive - the rates on these small, short-term loans are outrageous. But people see fewer barriers to entry. They don't know they're walking into a trap. Shouldn't being more accessible be a goal for every credit union?

  3.  Never Turn Away From Your Social Missions

    People value charity, philanthropy, benevolence - not because they're "trendy", but because they're the right thing to do. We know hundreds of credit unions that partner with great causes but rarely explain the depth and their level of involvement. Why shy away from talking about things like Credit Unions for Kids? Share the good news with more than just a parting shot in your newsletter - make it a cause that you champion, not just "support".

  4.  Play the Game, But Play to Win -

    Sure, LendingClub and Prosper.com are growing enterprises. But are they human enterprises?  Can they really lend and handle deposits the way you can? Are those prepay debit cards celebrities seem to love so much really a better alternative? The answer to all three of those questions is "no". 

    You can provide deposit insurance. You can provide security. You can provide convenience. You can do it all and, if you do it well, you can show everyone that you're not "just another bank" - you were facilitating "peer-to-peer" before it was cool. And you're still here now.

It's not just lending that's being overtaken by "the people" - it's debt forgiveness, too. The Rolling Jubilee raised half a million dollars, bought up thousands and thousands of dollars of debt from banks, and forgave it. These "gifts of forgiveness" went out to average consumers, bogged down by medical or educational debt, and told them their debt was forgiven in its entirety. 

Your average consumer now knows that there are multiple ways to manage one's money - there's the bank, there's the credit union, or there's "none of the above". 

We USED to be the way people loaned money to one another...now, we're a hinderance. We get our "people helping people" status back by being adaptable, affordable, approachable, and dependable. 

Let's get to it.