CORP-1295729.1-0915-1017

CUNA Mutual Group Proprietary

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© 2015 CUNA Mutual Group, All Rights Reserved.

Listen, Then Lend Enhancing your member-friendly sales culture in an

omni-channel environment

Be Vigilant About Your Competitive Environment

3

0

financial products and services

product opportunities

financial check-ins over last 8 years

Credit Union Opportunity

11 11

3

0

Product opportunities

Financial check-ins over the last 9 years

Financial products and services

3

0

financial products and services

product opportunities

financial check-ins over last 8 years

Credit Union Opportunity

11 › Member for 9 years

› Checking account

› Online banking

› Money market account (reasonable balance)

› Mortgage

› Line of credit

› Two auto loans (with payment protection)

› Credit card (absurd balance)

› Education fund account

Membership Growth Opportunities….

Banking Through The Ages

New Entrants Telecoms

Retailers

Alternative Payments Source: BDU Analysis

Platform Players

Financial Institutions

Card Companies

Non-Bank Competitors

Insurance

Key Competitors 2015

The Member Experience Today

OMNI-CHANNEL a multichannel approach that seeks to provide the member with a seamless banking experience whether the member is accessing credit union accounts and services online from a desktop or mobile device, by telephone, or in a bricks and mortar environment.

U.S. Economy

•Economic growth continues at a steady clip

•Unemployment rate down to 5.3%, personal income finally starting to rise

•Housing market gaining up steam

The Good News

Source: Credit Union Trends Report, July 2015

Credit Unions

•Record membership gains—100 million+ strong!

•Loan growth accelerating

•Strong financial performance

Challenge and Opportunity: To Get a Bigger Piece of the Pie

9%

Source: Federal Reserve Bank of Philadelphia, Consumer Credit & Payment Statistics, September 2015

Top NII Sources by Importance to Income

Source: Filene Research Institute, “In Search of Member-Friendly Noninterest Income,” 2012

Disruption

Source: Accenture, “2014 North

America Consumer Digital Banking

Survey”

35% of banking revenues will be at risk by 2020

72% would be likely to bank with at least one non-financial services company

71% consider their banking relationship to be transactional rather than relationship driven

51% want their bank to proactively recommend products and services for their financial needs

What Experts Have To Say

Big Bang Disruption is “an innovation that, from the moment of its creation, is both better and cheaper than the products and services against which it competes. Using new technologies in the Internet, cloud-based computing, and increasingly powerful and ubiquitous computing devices, Big Bang Disruptors can destabilize industries in record time, leaving incumbents and their supply chain partners dazed, and, soon after, devastated.“

“Big Bang Disruption,” Larry Downes & Paul Nunes, 2014

Successful Disruption: Smartphones

Source: BDU Analysis

The Battleground

Savings Lending

Investments Insurance

Financial Services

Payments

Financial Institutions

Retailers

Platform Players

New Entrants

Alternative Payments

Telecoms

Card Companies

Non-Bank Competitors

Potential Disruptors in Lending: P2P Leaders

• Leading P2P lender • Backed by Google, top venture capital firms, big investors • Majority (70%) of borrowers using their loans to consolidate debt / pay off credit cards

Source: Lending Club, lendacademy.com

*FICO score of 660+

Source: Lending Club, www.lendingclub.com/info

Kabbage Tries to Disrupt Small Business Lending

7 Minutes Site: Kabbage.com

Karrot with a K

Lifestyle Lending

Average Age of Borrowers Among P2P Lenders

Lending Club: 34

Credit Unions: 47

Themes in Retail Financial Services Disruption

Disruptors seek to:

• Use technology-driven business models, e.g., platform strategies

• Have a lower cost structure

• Find ways to bypass relevant laws and regulations

• Utilize low cost ways of moving money

• Aggregate customer data and monetize it

• Enter a single financial service before moving to other categories

Consumer Lending Strategies – Reduce Friction

REACTIVE

PROACTIVE

PREEMPTIVE

SIT AND WAIT o Initiated by customer (fundamental flaw) o Application required

ASK FOR THE BUSINESS o Promotions (seasonal or need driven) o Targeted pre-approvals & pre-qualifications o New account cross-sell (application required

EMPOWER THE CONSUMER o Comprehensive Pre-Screened Lending (CPL)

o NO Applications o Perpetual loan approval status o Multi-product o Omni-channel o Customer-centric

• Online applications • Instant approval • Many providers • Little differentiation • Little/no competitive

advantage

• “Spray & Pray” marketing initiatives

• Advertising & promotions • Teaser rates & incentives • Segmentation & targeting

strategies • “Instant” applications w/ cross sell

• Constant/consistent messaging

• All touch points • All direct channels • Instantly actionable

response

Invest In Digital Channels

Reform Physical Channels

Initiate Personalized Marketing / Data

Millennials are here, the competition is here. Consistent experience and content that is applicable.

Members have become accustomed to personalized marketing from retail brokers like Amazon. Credit unions should follow the same approach for their members. When members visit the credit union’s website, walk into a branch or open the mobile app, they want a personalized experience

Physical branches remain important. Consumers are attracted by experiences. The warm smiles of friendly member advisors, familiar faces from the community, and knowledgeable employees are some of the many benefits members receive from visiting their local branch. experiences

Omni-Channel Experience

Member Loyalty as a Disruption Defense

Consumer Personas at a Glance

Do High Marks on a Survey = a Loyal Member?

A loyal member is one who continuously looks to and trusts your credit union, over the long term, preferably on an exclusive basis, and recommends your services and products to friends and family.

Loyal members: • Promote your credit union and the

member experience it delivers • Close more loans with you, even at a

higher rate • Trust your employees as their financial

advisors • Rely on you to educate them and

protect their financial well-being

What Is Loyalty?

Are your members recognized and rewarded for

being loyal?

Loyal members:

• Promote your credit union and the member

experience it delivers

• Close more loans with you, even at a higher

rate

• Trust your employees as their financial

advisors

• Rely on you to educate them and protect their

financial well-being

How YOU Impact Loyalty

• Proactive Accountability

• Professional Personal Rapport

• Effective Communication

• Accuracy and Consistency

• Proactive Education and Service

What Is Loyalty?

Financial Check-Ins

Pre-Scheduled follow up call …With purpose

Member is coming in for a loan... Have purpose

Proactive call to check in…

With Purpose

Financial Check-Ins

MEMBER

NEEDS

School Years

Living on Your Own

Deployment

Marriage

New Home

New Baby

Divorce

Empty Nesters

Retirement

Death

Financial Check-Ins

During financial check-ins…

What life events have happened?

Change in income?

Change in expenses?

Change in current financial goals?

Vision for longer term future financial goals?

What Is a Transparent Sales Culture?

Sales Culture

Service Culture

Concierge Culture

Needs Based Culture

Solution Based Culture

Customer Centric Culture

What Is a Transparent Sales Culture?

Transparent

Implies openness, communication &

accountability.

Sales

Act of getting someone to

recognize the worth or value of

something.

Culture

The persistent behaviors and

beliefs of a group.

SERVICE Provide organization, group or person with something that it needs.

SERVICE SALES MEMBER

EXPERIENCE

Genuine Valuable

Trustworthy

Personalized Different

Better than the Rest

Sales / Service

What a Transparent Sales Culture Is NOT

Most annoying sales habits:

• Being too pushy (24%)

• Not taking no for an answer (23%)

• Not listening (18%)

• Talking too much (9%)

Source: “9 Things You Should Never Do When Trying to Make a Sale:

AMA Research,” American Management Association, Chris Brown

Window of Opportunity

86%

Are you taking advantage of these opportunities to connect and re-connect with your members?

“2015 Consumer Banking Insights,” BancVue

Change the Conversation

Review and analyze the information you already have.

– Account History, Information, Notes

– Credit Report

– Verbal cues and information shared by member

Ask purposeful questions to learn more about their specific needs.

Listen. Take notes about what they say and need.

Continue the Conversation

3 Days

Follow Up on opportunities for this loan.

GAP, MRC, Payment Protection, Auto Insurance (if applicable)

2 Weeks

Follow Up on something new from credit report (Credit Card, other Auto, Consolidation)

Minimizing inquiries on credit report

1 Month

Follow up on referrals to friends, family and co-workers

Schedule financial check in

Yearly!

Financial Check In

Own the Web Loan

eLending: The New Indirect – Opportunity or Threat

Rate, Rate, Rate

AUTO LOANS

starting as low as

2.5%APR

AWESOME CREDIT UNION

Change the Conversation

Our rates start as low as X.XX%. So I can present you with a loan best tailored to your needs, may I ask you a few questions?

What’s your rate?

Refinance with a Purpose

Why Are They Refinancing?

Improvement Efforts: Missing Elements of Change

Consider This from Robert Stevenson

So many times when I am asked to make a presentation, I

like to include something that has to do with TEAMWORK,

ACCOUNTABILITY and CHANGE MANAGEMENT.

I think the example below is a fantastic visual of how just

one person or one broken process/policy or lack of

accountability can really mess things up.

In this example, 46 keys are doing their job and one isn’t.

You would think 46 out of 47 (98%) would be a pretty

awesome percentage of competency until you see the

damage just one key can cause.

XVXRY KXY MUST WORK

Xvxn though my kxyboard is an old modxl

it doxs work quitx wxll xxcxpt for onx of thx kxys.

I wishxd many timxs that it workxd pxrfxctly.

It is trux that thxrx arx forty-sxvxn kxys that function wxll xnough,

but just onx kxy not working makxs thx diffxrxncx.

Somxtimxs it may sxxm that in an organization,

thx onx or onxs wx arx concxrnxd with,

arx somxwhat likx my kxyboard –

not all thx pxoplx arx working propxrly.

You may say to yoursxlf,

“Wxll, I am only onx pxrson. I won’t makx a diffxrxncx.”

Any program to bx xffxctivx nxxds

thx activx participation of xvxry mxmbxr.

So, thx nxxt timx you think you arx only onx pxrson

and that your xfforts arx not nxxdxd,

rxmxmbxr my kxyboard and say to yoursxlf,

“I am a kxy mxmber of my organization,

and I am nxxdxd vxry much.”

No matter how you look at it,

TEAMWORK & ACCOUNTABILITY MATTERS!

You have two choices:

either fix or replace your non-functioning “keys”

or your members will be replacing your credit union.

~ Robert Stevenson

Making the Most of Every Lending Opportunity

Ask members about their financial situation and explain why you’re asking.

Don’t be afraid to get personal

Open your books and your ears to employees

Make the mission the message

Tend to the weeds

Self Assessment for Your Staff

–How confident am I in the products and services my credit union offers?

–Am I being “consultative” and asking members the right questions to identify their full financial needs?

–Am I taking the time to fully educate members on the products and services they need?

–Do I go above and beyond what the member thinks they need to educate them on how they can realize their financial goals/dreams?

Thank You

Link

• https://www.youtube.com/watch?v=RFVk3TcGwdY

53 CORP-1295729.1-0915-1017

© CUNA Mutual Group, 2015. All Rights Reserved.

CUNA Mutual Group is the marketing name for CUNA Mutual Holding Company, a mutual insurance holding company, its subsidiaries and

affiliates.

This presentation was created by the CUNA Mutual Group based on our experience in the credit union and insurance market. It is intended to

be used only as a guide, not as legal advice. Any examples provided have been simplified to give you an overview of the importance of

selecting appropriate coverage limits, insuring-to-value and implementing loss prevention techniques. No coverage is provided by this

presentation/publication, nor does it replace any provisions of any insurance policy or bond.