The Steps Needed To Build A Credit Union's Brand

Want to know the power of the brand? Just ask the Royal Righa Hotel in New York.Known for catering to the rich and famous, when the Righa was bought by the Marriott chain and took that name, suddenly the rich and famous weren't drawn to the historic hotel. "The hotel hadn't changed. It had the same staff, the same d‚cor, same location. Only the name had changed," explained Larry Mersereau during his break-out session on branding at the Florida Credit Union League's annual meeting.

The self-described "Success Strategist" took his audience through the steps he said will help a credit union establish a strong brand. The first step is creating a positioning statement, which defines who the target market is and the competitive position enjoyed by the credit union.

"The first question is who are we after," Mersereau noted. "The more focused you are on a specific person, the more your marketing can speak directly to them. So, the more you expand your field of membership, the more diluted your message has to become."

That is why credit unions with a strong tie to one core sponsor has an easier marketing task than one with many select employee groups or a community charter, he noted.

The Four Market Positions

From there it's a matter of determining what the CU's market position is, and there are only four of them: The Leader. This is usually the one who got there first. "Leaders have to deliver the top-of-the-line, they have to be innovators or immediately match new innovations. They must fight to keep that position," he offered.

The Challenger. Mersereau noted that rental car business Avis is the quintessential challenger, using its market position as a rallying cry in its advertising, "We're No. 2, so we try harder." The challenger must offer all the same things the leader does and is usually similar in quality and type of service or product.

The Follower. The toughest of all the market positions, the follower tries to do as much as the leader and the challenger do as it can, but usually the only way a follower can differentiate itself is to be cheaper- not a strong marketing advantage in the long run, Mersereau argued, because the margins just get thinner and thinner.

The "Nicher." This market position is created by those who operate in a totally different market from the leader and the challenger, going after a totally different customer base. In the rental car business, for example, that would be Rent-A-Wreck.

Instead of offering shiny, new cars for rent, Rent-A-Wreck rents out cars that are typically three or four years old-reliable vehicles at a much cheaper price. A nicher can eventually become a leader if others decide to follow suit and get into the same market. Most credit unions, Mersereau said, are nichers, and one of the strengths of the niche position is that price competition doesn't have to be as big of an issue.

Knowing which market position the credit union is in and which positions have already been firmly established by the competition allows the credit union to determine market strategy and avoid wasting resources by going head-to-head with somebody who can't be beat out of its position.

The next step is determining what is the key benefit the credit union provides its membership. "How do you make your members' lives better," Mersereau asked. "What's your competitive advantage?" One common problem is mistaking a feature, like price, for a benefit. There is a difference, he said."How do you compete on price when everyone offers free checking," Mersereau asked. "No, one of your key benefits is that you have member owners but really, that's a feature. Turn it into a benefit by saying instead, 'if you do business here, you've got a piece of the action.'"

Delivering The Key Benefit

From that point, it's time to look at how the credit union delivers that key benefit. "This is the most feature-oriented part of the positioning statement. If you promise a 'longer lasting shine,' this is where you tell about the exclusive polymers you use to make it happen," he observed. "If you just do the same thing everyone else does, you're going to have a tough time writing this." Finally, there's the organization's personality. Southwest Airlines and Disney are two good examples of how strong an organization's personality can be and how that personality can become so legendary that it becomes the primary reason people choose to do business with it, he noted. "Very few companies think about what their personality is going to be," Mersereau advised. "But you have to know what it is and make it part of your identity because it's part of the reason people choose you." This five-step program-define the target market, define the market position, determine the key benefit, determine how to deliver the key benefit and establish the corporate personality-is designed to help an organization write a position statement, which in turn will help the organization create its brand, Mersereau said.

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