Jeff Stephens

The Difference Between Banks and Credit Unions

// January 29th, 2010 // 11 Comments » // Banking, Banks, Credit Union, Jeff Stephens

I had an interesting thought today, sparked by several tweets, blog posts, and a conversation with a potential client.  It was about the common discussion in our industry:  the differences between banks and credit unions.

We all know, there is indeed a difference.  It’s not that one is inherently better than the other, but there are differences for sure:  legal charters, ownership structures, regulatory differences, etc. There are thousands of websites (like this one from CUNA) with information about how credit unions are different. Still, people don’t widely understand these differences, and frequently make mistakes about them.  Most consumers confuse the two, and the media clearly confuses them routine–they often call credit unions “banks” in news stories.

So here’s the interesting question:

Why is it only credit unions who get pissed about this misunderstanding and confusion between banks and credit unions?

Shouldn’t the banks get just as angry? After all, lumping the two together is a mixup that adds just as much confusion about what banks really are, as it does to what credit unions really are.

Sure, I understand that credit unions are called banks more frequently than banks are called credit unions. But think about it: both banks and credit unions alike have every reason to be aggravated by this continued and frequent mixup. So why don’t we hear more uproar from banks? How come there are no chants about “the bank difference” like there are for “the CU difference”? Shouldn’t both sides be equally interested in clarifying their qualitative differences and arming consumers with accurate information?

In other words, why aren’t banks offended when credit unions are lumped in with them?

(BTW, I honestly don’t have an opinion I’m trying to sell you, on this topic. I just find it extremely interesting and would love to hear your theories.)

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Affiliate Marketing in Banking

// November 18th, 2009 // No Comments » // Banking, Innovation, Jeff Stephens, New banking ideas

As I was reading something businessy lately, a question popped up in my mind:  why isn’t there affiliate marketing in banking?

Maybe there is, in a few cases, on a B2B level—you might argue LendingTree is affiliate marketing for lenders.  But that’s not what I mean.  There’s not, to my knowledge, any affiliate marketing program that could leverage the millions of retail customers out there. For instance, how many Bank of America customers have blogs or websites? Probably millions. Why not take a page from Amazon.com’s book (pun intended) and set up a killer affiliate program to drive traffic to the bank and kick back a reward to the referring site for accounts opened online?

I think I know why.

Because that’s not what bankers do.

Because that’s not how banking works.

And because, likely, nobody has ever really thought about it.

If you can’t tell already from my first few posts on this blog, one of my big pet peeves is that bankers don’t tend to look at business concepts (like affiliate marketing) and try to figure out how it might apply in their industry.

In my opinion, the best and most important activity any entrepreneurial banker can do, is this:

Look at other industries, see what’s successful, and then ask, “how can I apply this to banking?”

I’m not here to tell you affiliate marketing should be the future of banking.  I don’t have an opinion at this point, because I haven’t given it much thought.  Maybe I can think it over and write another post about that.  But I do know this:  at least I remembered to ask myself “how can this apply to banking?”  The answer to that question is less important than the fact that it was asked in the first place.  That’s how innovation happens.

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Richard Branson: Finally an Entrepreneur in Banking

// November 8th, 2009 // 1 Comment » // Banking, Being an entrepreneur, Richard Branson

One of the things you should know about me early-on is that Richard Branson (Virgin Group) is my entrepreneurial hero.  I am more or less obsessed with studying his career, his moves, and perhaps most importantly, his outlook and attitude toward business.  He wrote a book, whose title I really relate to:  Screw It, Let’s Do It.

Branson and Virgin have already been in the banking space to a certain extent with Virgin Money (in the US, Virgin Money helps formalize lending between friends and family; in the UK and a couple other regions, it provides broader financial services).  Now, Virgin has applied for a full banking license, to become a complete full-service banking company.

Watch out bankers.  There’s finally a real entrepreneur in banking.  That should make you very nervous.

That’s because entrepreneurs don’t think like bankers.  Bankers think like bankers.  But entrepreneurs think about applying business principles and scrappiness to creating and building businesses. They don’t focus on running businesses–that’s for managers.  Entrepreneurs, instead, focus on starting and growing…architecting dynamic organizations that shake things up from the traditional.

You can bet I’ll be following Sir Richard’s efforts very closely…and cheering them on.

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Hi. It’s me. Jeff. Jeff Stephens.

// October 25th, 2009 // No Comments » // Banking, Being an entrepreneur, Brand and Branding, Innovation, Jeff Stephens

Um, hi.  Nice of you to stop by here.  If you can’t tell, this is my first post on my brand new blog. I’m excited to start this thing–I’ve been considering it for a while and decided it’s finally time to put some Jeff-think out there.  The wheels of my mind are turning all the time, much of the time about my family, friends and life, but also much of the time about business.  Here’s what we’ll be talking about in this blog:

• being an entrepreneur
• business philosophies
• banking
• “innovation”
• making people give a damn about what you do
• many combinations of the above, and surely a few random ingredients tossed in for good measure

Specifically, if I had to state the the thesis of this blog, it would be this.

I get fired up about injecting some entrepreneurialism and business thinking into banking.  Today’s banks are run by bankers, not business people or entrepreneurs–and the industry needs a dose of outside, ballsy business thinking worse than anything else.

You may disagree with me already.  I kinda hope so–now you’ve got a reason to keep reading.

Just so you know, in case you follow my other endeavors at all, this blog will not be redundant to the blogs run by my companies (http://creative-brand.com/thestory and http://psstmarketing.wordpress.com).  This blog will be broader, more personal and more, well, me.

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