DENVER–Middle America is a mighty large group. But new research has sliced that enormous population into some small pieces and, in turn, offered strategies for better understanding and anticipating member behavior.
The findings and direction are based on considerable research that CUNA Mutual has done as it targets and refines both the product offerings and the messaging around its TruStage insurance products. That research probes the behaviors and attitudes of credit union members, bank customer/non members, and the unbanked, and offers insights into the approaches credit unions should consider for marketing not just insurance products, but loans and even the broad concept of membership.
“Consumers drive everything we do,” said Angie Fuhrken, Director, TruStage, in remarks to the joint conference hosted here by the World Council of CUs and CUNA. “We have two-million conversations every year with credit union members, and have 65-million credit union members in the database. We are able to leverage insights from all those conversations and that data to help us get the right product to the right consumer at the right time.”
Reams of Secondary Data
But CUNA Mutual also looks to secondary data, including custom research that it conducted that included insights collected from 25,000 data-points, including the GfK MRI Analysis, photo journals and social media, and consumer surveys. For the photo journal piece, CUNA Mutual asked 83 CU members to share a photo journal with the company during a one-week period. “We have reams and reams of information about these consumers about not just what they said, but what it looks like to them,” said Fuhrken.
The research found that CU members today in the U.S. tend to be less racially diverse than bank customers and the non-banked population; that CU members tend to be more highly educated, and that membership tends to skew to Baby Boomers and Generation X.
At a more granular level, the CUNA Mutual research discovered that CU members are more likely to cook for fun, shop smart, worry about the environment, exercise, vacation in the U.S., and own a dog. They are less likely to regularly have a glass of wine with dinner, regularly update social media, and smoke.
An Interesting Finding
“What I find interesting about social media is that they are on social media, they just aren’t regularly updating,” said Tina Buttchen, TruStage Program Sales Specialist, who co-presented with Fuhrken. “In next 12 months, CU members more likely to remodel their kitchen, remodel their bathroom, invest in stocks/bonds, and vacation in the U.S. Fewer than 10% said they would be looking to buy or sell a house in the next year. Members are also more likely to be married, shop at Target, have an auto loan, and have life insurance. They are less likely to shop at Family Dollar, want to reach the top of their profession, buy celebrity-endorsed products, and strive for social status.”
The sweet spot for TruStage is middle-income America, which it defines as between the ages of 30-70 and with a household income between $25,000-$100,000. That demo represents 36% of the U.S. population and 42% of all credit union members.
“Why are we focused on middle income consumers with TruStage?,” asked Fuhrken. “The vision is to be the most compelling and successful way for middle-income credit union members to build financial security for their families. The reason for this is twofold: Middle-income consumers are some of the most unprotected consumers out there--43% don’t have life insurance, and 48% prefer to buy direct. And anecdotally we are seeing that that preference continues to climb; they want to interact with us on their terms.”
Big Users of Financial Products
Buttchen said the research shows middle-Americans are big users of financial products, with higher use of overdraft, personal loans, auto loans and mortgages.
“Middle-income America more likely to have enjoyed a barbecue, be married, enjoy gardening, believe in faith-based ideas, and own a dog,” said Buttchen. “In next 12 months indicated more likely to invest in stocks, do remodeling, purchase a new vehicle and have a child go off to college.”
But despite all those plans and even optimism, the research found a certain level of financial anxiety in middle-America.
“Among middle-income consumers, 62% worry about their family’s financial stability on a daily basis,” said Fuhrken. “Fifty-eight percent say their income is the same or lower than it was five years ago, and one-third have more than $25,000 in non-mortgage debt.”
Worried, But It Doesn't 'Define' Them
But Buttchen said the research found that even though many of the people interviewed indicated they were living paycheck to paycheck and are worried about finances on a daily basis, “it doesn’t define them. They want financial guidance and this is what credit unions are so great at. Eighty-percent of middle-America trusts credit unions. What a great opportunity to step into a financial advisory role. When we pair that with the 64% of non-CU members who would consider opening a credit union account, this really speaks to the market available to us.”
But what does all that mean to insurance sales, specifically, the TruStage product line?
“Eighty-one percent say you need to have life insurance (57% have it),” said Fuhrken. “They value life insurance, they just don’t know how to go about having it. One insight from another study that really stood out to us was that there is a strong tie between the degree of simplicity a consumer perceives in any given industry and brand, and their likelihood to recommend it to family and friends. Insurance consistently ranks among the most complex industries.”
Other Findings
Among some of the other findings shared by Fuhrken and Buttchen:
- When this question was asked: “Years from now, if you were to reflect back on your life, what do you hope you will have experienced or accomplished that will help to affirm your life was a success?,” the overwhelming, number-one response was that success is expressed via their kids’ happiness and healthiness. Number two was “being a good partner,” while “financial stability” appeared at number three. At number four was “good health,” and at number-five was having a “strong spiritual relationship.”
“Seventy-seven percent of those interviewed said their definition of success had changed over time and that was true of all generations. Keep in mind that the definition of success is always evolving,” said Buttchen.
How has CUNA Mutual turned all of those insights into action?
- The company created an infographic titled “Life Insurance and AD&D Simplified” to make the products easier to understand.
- It has emphasized affordability, as focus groups repeatedly said when they used life insurance calculators they were left with impression they could not afford the life insurance they need. “So we flipped life insurance calculators on their head,” said Fuhrken. “What’s most important is that they get at least some life insurance,” and a new tool shows insurance as being more affordable.
- It has provided connections with TruStage Connect, including a newly launched chat feature
What To Do With Information
What can a credit union do with some of the information gleaned? According to Buttchen, CUs can put an emphasis on:
- Marketing toward home remodeling activities.
- Loan consolidation.
- Elevating target personas.
- New employee training.
- Creative direction in imagery and copy.
- Community involvement with family focus.