The Annual Marketing and Communications Plan

Peggy Olson
March 17, 2010

Although many credit unions start out the year with business plans, sales strategies and budgets, one thing often overlooked is creating a comprehensive, integrated marketing and communications plan to support their goals.

An integrated marketing and communications plan documents in detail the actions required to support reaching specific business goals and sales objectives. It identifies what to do, when to do it and how to do it, with all marketing tactics working together in a consistent, repetitive approach to reflect the same messages and visual clues.

This makes your credit union and message more likely to be understood and remembered in a crowded, noisy marketplace.

An Integrated Approach

For credit unions, an annual integrated marketing and communications plan should address a number of areas, including how to support your sales team to achieve revenue targets, new banking solutions and services you will introduce during the course of the year, steps or campaigns to improve customer acquisition and decrease attrition, and actions that increase brand recognition and thought leadership.

Start with you business plan, and make sure you are clear on the overall goals and objectives for the year. Then review and assess your marketing and communications effectiveness to document what activities, programs and materials you have in place and to identify what's working, what's not and any gaps.

Next, develop your marketing and communications plan by generating a comprehensive list of potential tactics to use in supporting your business today and throughout the coming year. You'll want to address a variety of topics as well as begin the process of estimating resource requirements, both in-house and agency, in addition to associated budget expenditures for each market vertical, segment and channel you do, or want to do, business in.

An Essential Checklist

Primary areas to consider and questions to ask include:

Brand image and corporate identity: Are your company's logo, brand look and feel (style and coloring), and business templates up-to-date, professional and uniform across all communications vehicles? Are you interested in consolidating multiple brands from previous acquisitions or rebranding to create a totally new image?

Positioning and messaging: Do you succinctly articulate your company's promise of value and the value propositions for each of your products and services? Do you clearly differentiate yourself from the competition?

Marketing collateral: Do your materials consistently represent and reinforce your corporate identity and brand messaging, or are they a bunch of one-off, disparate pieces? Are they easy to grasp or filled with meaningless gobbledygook and techno speak? Are they being used effectively, or are they just taking up shelf space?

Sales materials and tools: Is your sales team armed with appropriate materials (quality and quantity), including presentations, brochures, data sheets, handouts, testimonials, case studies, demos, return on investment calculators, pricing sheets and white papers, or are they left to figure out how to create their own? Are materials and tools available for download from your website?

Lead generation: Do you know your lead-to-sale conversion rate? Are you doing enough to fill your sales funnel or pipeline adequately? What lead generation vehicles will you employ—direct mail, telemarketing, e-mail marketing, social media, merchant referral campaigns, or web and print advertising? How often and for what purposes will you employ lead generation techniques for customer acquisition and up-sell and cross-sell opportunities?

Customer retention programs: How can you enhance your company's image in the minds of your customers? Should you offer special promotions, incentives or pricing schemes? As a component of customer service, do you regularly communicate with your customers about such topics as company news, service metrics, new product and service offerings, compliance issues and other pertinent industry and legislative news? Have you considered an electronic newsletter or e-mail blasts? Do you have a program to encourage continuing interactions with customers?

Product launches: Based on your business plan, what new offerings or value-added products and services will you launch during the year? How and when do you plan to introduce them?

Events: Do you want to hold meetings and training classes for your sales force in person, via webinars, through online tutorials or other mechanisms? What topics are of critical importance to cover? If so, what delivery vehicles will you use and what topics will you cover?

Tradeshows: Have you evaluated all the tradeshows in the credit union space and across all of your market verticals? Which ones make the most sense to participate in as an exhibitor or as an attendee? What are your objectives for the tradeshows you will exhibit at and attend? How many meetings can you set up? Is your exhibit display worn out and need replacement? Does it properly reflect your brand identity so that tradeshow attendees can easily find and recognize your company?

Website: What does your website say about your company? Is it professional and informative, as well as easy to understand and navigate? Does it turn visitors into prospects and then customers who respond to your calls to action?

Advertising: Which trade publications does it make sense to advertise in? Have you considered the pros and cons of print and online advertising? What is the purpose of your advertising—brand awareness, promoting one or more products and services, or something else?

Publicity: What do you project will happen in your business in the coming year that is worthy of media coverage—an acquisition, a key executive joining the company, a new product or service, a new large customer, or a company award? Are your press release distribution process and vendor effective? Can your employees act as authorities or experts for speaking opportunities and provide quotes for news articles? Do you have relationships in place to make industry and media placements happen? What about volunteering on industry association boards and committees and the possibility of corporate sponsorship? Have you considered social media marketing (Twitter, Facebook, LinkedIn) or implementing a blog?

Crisis communication: Do you have an up-to-date crisis communication plan that can be readily executed in the event of a data breach, business downturn, legal incident, natural disaster or other unfavorable or catastrophic event?

Sales commission, incentives and residuals: Do you have competitive plans in place? What types and how many incentive programs or sales contests will you employ?

A Valuable Process

This is a brainstorming process; your company doesn't need to undertake all of these tactics to be successful. Use this as a checklist or guide to develop a plan that is aligned with your strategic goals.

The next step is to prioritize the tactics of your integrated marketing and communication plan with the goal of matching them to your personnel resources and annual budget. This process will determine the most effective means of distributing your message to support your identified goals.

Also, define reasonable metrics that measure return on investment for key tactics. Once your plan is finalized, a marketing calendar should be created; then the real work of tactical execution can begin.

This process is probably far more complicated and labor intensive than what you may have initially thought, but there's no better time than right now to get started. It's a critical step toward achieving your 2010 goals and taking your credit union to the next level.

Peggy Bekavac Olson is a senior consultant for Align fsc, an Atlanta-based consulting firm. She can be reached at 480-706-0816 or peggy.olson@alignfsc.com.

Fed Requests Comments on Third Set of Regulation Z Rules Implementing the New Credit Card Law

CUNA
March 16, 2010

The Federal Reserve Board (Fed) has recently published a third and final set of proposed rules that implement provisions of the Credit Card Accountability, Responsibility and Disclosure Act of 2009 (CARD Act). The CARD Act was enacted last year, which prohibits and restricts a number of credit card practices. This new proposal would implement the provisions of the CARD Act that will become effective on August 22, 2010. These include provisions that are intended to protect credit card users from unreasonable penalty fees and that require card issuers to reconsider interest rate increases every six months after the increased rate becomes effective. This proposal follows two earlier rules that implement the CARD Act provisions, which were effective as of August 20, 2009 and February 22, 2010. The links below provide more information about these two earlier rules:

• http://www.cuna.org/reg_advocacy/member/download/fed_012910.pdf
• http://www.cuna.org/reg_advocacy/reg_call/rcc_073009.html

Among other provisions, this proposal would:

• Provide three alternatives for determining the amount of penalty fees that may be charged by card issuers.
• Prohibit card issuers from charging penalty fees that exceed the dollar amount associated with the violation. For example, if the minimum payment is $20, the late payment fee could no longer exceed $20.
• Ban inactivity fees or fees for closing and terminating the account.
• Prevent card issuers from charging multiple penalty fees based on a single violation.
• Require card issuers to inform consumers of the reasons for an increased interest rate.
• Require issuers that have increased rates since January 1, 2009 to review these increases every six months and to reduce the rate if the reasons for the increase no longer apply.
• These rules apply to credit cards, but not to home equity lines of credit accessed by credit cards or to overdraft lines of credit accessed by debit cards.
• Comments on the proposed rules are due April 14, 2010 . Comments are due to CUNA by April 6, 2010. If commenting directly to the Fed, you must refer to Docket No. R-1384.

Please feel free to fax your responses to CUNA at 202-638-7052; e-mail them to Senior Vice President and Deputy General Counsel Mary Dunn at mdunn@cuna.com or Senior Assistant General Counsel Jeff Bloch at jbloch@cuna.com ; or mail them to Mary and Jeff in c/o CUNA's Regulatory Advocacy Department, 601 Pennsylvania Avenue, NW, South Building, 6th Floor, Washington, DC 20004. You may also contact us if you would like a copy of the proposed rules or you may access them here .

> View the full comment call at cuna.org here

Those Crazy Kids

Brian Wringer
March 11, 2010

You've probably seen a couple hundred articles about all the ways the internet and social media are going to change marketing forever. We are facing a fundamental shift in marketing, but it's not particularly tied to a certain technology or fad -- it's tied more to some profound differences in generations.

The younger people now coming in to economic power (ages 18-25) have been target marketed to for their entire lives. Database marketing got its start in the late '70s and became prevalent in the early '80s. People in this age group also grew up surrounded by cable TV, computers, and the internet, and many have had their own cell phone since at least their early teens. We can't market like it's 1950 any more.

Here are a few of the ways young adults are different -- probably more different than you expect.

- Young adults feel absolutely no obligation to you or your message. This is an important point -- where someone over 40 might open or at least glance at your message out of a quaint sense of obligation, a young adult will immediately mark it as spam or chuck it into the recycling bin, usually with no conscious recognition. They eagerly use ad blocking software online, rip ads out of magazines before they read them, shovel most of their mailbox contents directly into the recycling bin, and skip commercials entirely.

- Young adults have nearly infallible built-in spam filters. In fact, there's research that indicates they literally don't even see things that look like advertising -- for example, anything that blinks or is the shape of an ad or billboard might as well be blank.

- Young adults instinctively understand that their attention is valuable. You can't have it for free.

- Information is also valuable. You won't get a real email or physical address without providing significant value in return. If you have a roadblock in front of something they want, you will get the garbage input you deserve in return.

So what's a marketer to do? If you're flexible and respectful, there's a bright side for credit unions:

- We all know they spend a lot of time online, but young adults place the most value on authentic human connections and reputation -- these are two areas where credit unions can and should do very well. It's also easy to mess this up -- does your web site look and feel real, unique, trustworthy? Or is it just another corporate-looking clone of a bank site? Do you allow members to email you, and does a real human respond almost immediately?

- The medium of contact means very little -- the human on the other end is what matters. Most young adults have close friends they've never seen in person. If you send an email, make sure it's from a real person, and that it's welcome and relevant. If you have a blog or use social networking, put a real person with a real personality in charge of it, and make sure they have the time available to do it right -- otherwise, don't bother.

- Reputation is everything. Understand and manage your reputation online and in personal contacts.

- Honesty is part of reputation. Again, credit unions can and should have a leg up in this area. Design (or revamp) your products and your marketing with an eye toward simplicity, authenticity, and value. If you're hiding everything behind walls of fine print, you're being dishonest.

- There's great value in being different. This is something credit unions do very well day-to-day, but very few market the difference, or allow the personality of the credit union to come through on their web site.

- Pay closer attention to the way your web site, your home banking, and your other online services work, look, and feel. Young adults will delve into your web site and research your reputation online before they ever consider opening an account. Does your web site do a good job of reflecting your credit union's positioning, personality, and branding? Does your home banking look like something designed by a fly-by-night in 1994 or a modern financial institution in 2009? Is your online loan application a fake -- "We'll call you the next business day..." -- or is it actually part of your process?

Brian Wringer is Wordsmith at iDiz Inc., a marketing firm that works with credit unions. Contact him at 317.576.0602 or brian@idizinc.com. Reprinted with permission.

Are Your Business Models and Brand Strategies Aligned?

Kay Plantes
March 10, 2010

A new client asked me a good question today: “You talk about helping us find our value promise, but my communications agency is totally focused on our brand platform. What's what and why does it matter?”

The answer rests in understanding communication challenges.

The Internal Communication Challenge

Employees need a shared and actionable aim that advances the company's success. It must be actionable so that employees and teams know how to go about their work. The aim must also be shared or else actions by one part of the organization hurt another part's success, creating distrust and silo-mentality. (These two requirements are why “Grow profits and revenue” as the only aim fails.)

The best internal directive is a value promise. It's the promise the company makes to its target customers and the basis on which it wants to win business. Internally, it tells everyone the ultimate goal of his or her work. I recently interviewed ten employees of Tasty Catering, a business caterer in Elk Grove Village, Illinois. They each knew their job was to exceed their customers' most demanding expectations. The entire company's business practices, including its values, are aligned to deliver just that.

Great companies build annual operating plans to advance their value promise and make it hard for competitors to copy.

The External Communication Challenge

The external communication challenge is to grow awareness, consideration, trial, and purchases. Clearly the value promise is a key part of this, but effective communications must also be emotional and tell a story. The brand platform captures what's needed for winning marketing communications.

• The brand promise: the value promise discussed above
• The foundation story of the company: how it became what it became, revealing the deeper values of the company
• The brand personality, which captures for example whether a company's qualities are more like Lexus or a Ford Truck
• The brand essence: a clear list of what the brand is and is not
• The message strategy: target markets, key message, and key word in the message, and reasons to believe

The brand platform drives marketing and sales, the two external facing parts of any organization.

Alignment Issues Are at the Core of Every Business Problem

When the brand platform is not backed up by a strong value promise that internal operations are designed to fulfill, ads, brochures, sales reps and websites make false promises. Marketing communications become spin and customers defect. In addition, the company creates new products and services that fail to support the brand promise, diffusing brand equity.

These problems arise because frequently inside-facing employees have no idea about the basis on which the company is trying to win business. All too often, companies have not defined their value promise, much less their business model (see Harvard Business Review's  “Can You Say What Your Strategy Is?”).

Another mistake companies make is creating a brand promise that lacks any functional differentiators around which employees can relate how they go about their work. Brands without tangible, functional legs of differentiation easily fall down. Companies that keep changing the brand promise also create havoc when internal operations are forced to follow flavor-of-the-day priorities. While business models must change to remain relevant and differentiated, value promises should evolve, not totally disconnect from the past.

A different set of issues arise when the company has a great business model and a compelling value promise, but fails to communicate it effectively to outside audiences. Awareness rates, consideration rates and attitude towards the brand remain weak, hurting sales and margin growth.

Summary

The value of the value promise is that it aligns internal and external communications. At the same time, it aligns internal operations with front-facing marketing and sales. The net result is growth and higher margins.

It sounds so simple. Why do so many companies muck it up?

Kay Plantes is an MIT-trained economist, business strategy consultant, columnist and author in Madison, Wisconsin. Reprinted with permission from her blog at www. plantes company.com/ blog.

Comment Call: Proposed Clarifications to Overdraft Protection Rules Under Regulations E and DD

CUNA
March 10, 2010

The Federal Reserve Board (Fed) has issued clarifications to the recent final rules amending Regulation E, the Electronic Fund Transfer Act, that prohibit credit unions and other financial institutions from charging overdraft fees for ATM and one-time debit transactions, unless the consumer consents, or “opts-in.” Compliance with these rules will be mandatory as of July 1, 2010, although fees may continue to be assessed without the consumer's permission until August 15, 2010 for those accounts in existence as of July 1st. Click here for more information about these recent final rules.

The Fed has also issued clarifications to the recent final rules amending Regulation DD, the Truth in Savings Act (TISA), that changed the disclosure requirements for overdraft protection plans. The Regulation DD rules do not apply to credit unions but the National Credit Union Administration has issued substantially similar rules, as required under TISA. Compliance with the recent rules issued by both the Fed and NCUA was required as of January 1, 2010. Click here for more information about these rules.

Although credit unions and others have an opportunity to comment on these clarifications, the Fed has emphasized that they will not change the substantive provisions of these rules and that these comments should be limited to the proposed clarifications.

Here are the clarifications for the Regulation E rules:

• The rules include an exception from the requirement to send a notice and obtain an opt-in before charging overdraft fees if the financial institution has a policy and practice of declining ATM and one-time debit transactions when the institution has a reasonable belief that the account has insufficient funds at the time the authorization is requested. The proposal clarifies that charging fees are still prohibited if the consumer does not opt-in and that this exception only provides relief from the notice and opt-in requirements.
• The Fed recognizes that financial institutions may not be able to avoid paying certain ATM and one-time debit transactions that overdraw the account and that the institution will not be able to charge a fee if the consumer does not opt-in. However, the rules prohibit charging fees in these situations, and the proposal clarifies this prohibition.
• If the consumer opts-in, the financial institution must send a written confirmation of the opt-in selection. The proposal will clarify the official staff commentary to Regulation E to indicate that fees may not be charged until the confirmation is sent to the consumer and that institutions will be in compliance with these provisions if they have adopted reasonable procedures designed to ensure that the written confirmation is sent before fees are assessed.
• Some institutions impose different, or “tiered,” fees based on the outstanding negative balance at the end of the day. This would be when one fee is charged if the negative balance is below a certain amount, while a higher fee is charged if the negative balance is above this amount. The proposal will clarify the official staff commentary to indicate that this fee must be based on the amount based solely on the check, automated clearinghouse (ACH), or other transactions if the consumer has not opted-in to ATM and one-time debit transactions. For example, if a negative balance is attributable to both a debit and check transaction, then it would only be the amount of the check transaction that would determine which tier would apply.
• Some institutions may apply daily or sustained overdraft fees in which an additional fee is charged if the overdrawn amount is not repaid within a certain amount of time. Although this is not permitted for ATM and one-time debit transactions, unless the consumer opts-in, these types of fees are permitted for check, ACH, and recurring debit transactions. The official staff commentary clarifies that fees may be charged in situations in which a negative balance results from both an overdraft in which an opt-in is required and an overdraft, such as a check or ACH transaction, in which the opt-in is not required. For example, if an account has a balance of $50 and there is then a $60 debit and a $40 check transaction, the institution may charge a fee for the check only and then charge a sustained fee if the negative balance at that time is attributable in part to the $40 check. For sustained fees, the date that the account goes into overdraft is determined solely by the date that the check, ACH, or other transaction is paid into overdraft for purposes of calculating the date when a sustained fee can later be charged, even if ATM and one-time debit transactions are posted on different dates. For example, if new fees are charged if the account remains negative after five days, then the five-day period begins on the date the check, ACH, or other transaction is posted, regardless of when the ATM or one-time debit transaction is posted.
• The proposal revises the official staff commentary to clarify that credit secured by margin securities in brokerage accounts extended by registered broker-dealers is not considered an “overdraft service.”
• The Fed intends to finalize these clarifications before the July 1, 2010 mandatory compliance date.

Here are the clarifications for the Regulation DD rules:

• The proposal clarifies that the term “Total Overdraft Fees” must be used on the period statement when describing the total amount of fees imposed for paying overdrafts.
• For balance information that is disclosed through an automated system, the rules require that it not include the amount available that the institution may provide to cover items, including amounts available under an overdraft program. The proposal clarifies that amounts available under a retail sweep account can, however, be included in the disclosed balance information.
• The rules allow disclosure of an additional balance that is available through an overdraft program, line of credit, or transfer from another account, as long as it is prominently disclosed that this second balance includes this additional amount. The rules indicate that the second balance may not be disclosed if it is in connection with an overdraft service if the consumer has opted-out of the service. The proposal clarifies that this also includes when the consumer has not opted-in when the opt-in is required for the service. If the additional funds are not available for all types of transactions, then this must also be disclosed along with the additional balance. The proposal includes the example that it must be disclosed that the consumer may not access the overdraft balance through ATM and one-time debit transactions if the consumer has not opted-in to the program, even if the funds may be available through a line of credit or transfer from another account.
• The clarification with regard to the use of the term “Total Overdraft Fees” will be effective 90 days after these clarifications are issued in final form. The other clarifications will be effective 30 days after they are issued in final form.

Comments are due to the Fed by March 31, 2010. Comments are due to CUNA by March 23, 2010.

Please feel free to fax your responses to CUNA at 202-638-7052; e-mail them to Senior Vice President and Deputy General Counsel Mary Dunn at mdunn@cuna.com and to Senior Assistant General Counsel Jeff Bloch at jbloch@cuna.com; or mail them to Mary and Jeff in c/o CUNA's Regulatory Advocacy Department, 601 Pennsylvania Avenue, NW, South Building, 6th Floor, Washington, DC 20004. You may also contact us if you would like a copy of the proposed clarifications or you may access them here:

• Regulation E clarifications
• Regulation DD clarifications

> View the full comment call with questions to consider at cuna.org