#MoveYourMoney: Not As Good for Banks and Credit Unions As They Think It Is
// July 23rd, 2010 // 14 Comments » // Banking, Banking business strategy, Banks, Brands and Branding, Credit Unions
I suspect this might be a pretty unpopular perspective. I’m not trying to be a downer, rather a realist, entrepreneur and business strategist.
Over the last several months, the “move your money movement” has gotten a lot of attention, thanks to websites like http://moveyourmoney.info. On Twitter you’ll frequently see hashtags like #moveyourmoney and #banklocal. More and more, I see links posted to articles all over the web talking about how credit unions and community banks are a great alternative to big banks. Many seem to be hailing this as one of the best things to happen to community banks and credit unions. Although I’m not studying market share numbers, it does seem rather undeniably true: consumers are moving their money from big banks to smaller, local banks and credit unions.
There’s just one problem. And it’s a big one, rendering this “movement” only mildly useful for any individual bank or credit union.
When a consumer opens an account at your bank or credit union because of #moveyourmoney, they are doing so because they DON’T want an account at a big bank. Furthermore, they’re opening an account at your bank or credit union simply because you are a smaller, local alternative…NOT a big bank.
Do you see the problem? They are not choosing you for who you are…they are choosing you for what you are NOT. And unfortunately, you are just one of thousands of banks and credit unions who are NOT big banks. (Metaphor/Translation: “Honey, I’m not marrying you because I actually love YOU, you silly goose; I’m marrying you because you are NOT someone I hate…and you are available. Duh.”)
So what does this mean? It means that these new customers and members you’ve just acquired are not necessarily a good fit for you at all (just because they’re a bad fit for Chase doesn’t mean they’re a good fit for Acme Credit Union). It means they will be just as fickle and transient as your other customers/members; just as price-sensitive and ready to “move their money” again when a better deal comes along.
You see, there’s one simple fact, and there’s unfortunately no way to get around it (not even with a grassroots effort like #moveyourmoney):
Long-term prosperity at your bank or credit union only happens when consumers proactively choose to bank with YOU for who YOU are: because they feel you are the one and only fit for them, and they refuse to live without you.
The Bottom Line: If you are growing because of the “move your money” effect, you are the random and lucky recipient of a cultural shift outside your control…and you will become keenly aware of just how outside your control it truly is, once the effect starts wearing off. Instead, focus on attracting people who love YOU.
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