Setting a Member-Centric Strategy

CU360
May 27, 2010 | COMMENTS

Although unemployment rates remain high and some market sectors, such as real estate, have not yet rebounded, most corners of the economy continue to gain strength. As business and financial performance improves, many CEOs are focusing on expanding product sales or diversifying into new markets.

That type of thinking is a common knee-jerk approach most decision-makers often make in the early stages of an economic recovery. Ultimately, however, it's a misguided methodology according to marketing strategists at the Peppers & Rogers Group.

The best advice for the C-suite is to avoid the mistakes of the past and shift away from product-centric, short-term financial strategies to a longer-term, customer-focused approach. As consumer activity ticks up, CEOs should be evaluating customer behaviors and attitudes to help them develop a more comprehensive understanding of what consumers want, and then tailoring products to meet their needs.

Such a customer- or member-centric strategy can go a long way towards helping CEOs achieve longer-term goals and generate sustainable revenues.

Granted, CEOs have to retain some level of short-term strategic focus. Whether measured quarterly or long term, there are ample opportunities for leaders to monitor performance by drawing on customer-centric measures such as return on customer (ROC), customer retention rates, upsell and cross-sell conversion rates, and the like.

Putting existing customers first

In recent years business leaders have placed considerable emphasis on acquiring new customers. But they've skimped on efforts to retain existing customers and strengthen those relationships. Focusing on retention means that CEOs need to truly listen to customer feedback through all channels, including social media, website, and contact center interactions.

Additionally, business leaders should use advanced analytics to surface the hidden gems of customer insight from the traces customers leave at all touchpoints. Top executives should also strive to make themselves more accessible to customers through online discussion groups, town hall-type meetings, and other forums. Meeting and interacting with customers helps CEOs put a face on a company and personalize its image.

A good starting point for credit unions devising member-centric strategies is to envision what the ideal member profile will look like 10 years from now. The overall profile can be composed of a number of micro-groups. By projecting characteristics of ideal future members, executives will be much better positioned to listen, understand the needs of their target group, and determine the types of products and services their credit unions should be developing. In turn, these actions will help decision-makers at all levels create a roadmap for future success.

This article was orginally published online by CU360, an online portal for benchmarking tools, market insights, industry data, and analytical information at cu360.cuna.org. Reprinted with permission.