By Patty Corkery
For generations, financial advice often started close to home. When it came time to open a first checking account or decide where to keep your savings, you might have asked your parents where they banked. More likely, they may have opened that first account for you.
As you got older, perhaps you turned to a friend or coworker for a recommendation. Either way, it was usually the people you knew and trusted who helped shape where you put your money.
Those personal connections still matter, of course. But they have new competition.
As part of its Try a Credit Union consumer awareness campaign, the Michigan Credit Union League regularly studies how consumers think about and choose financial institutions. Our latest Michigan Consumer Awareness Study, which surveyed more than 600 consumers across three generations, found that online sources are now among the most commonly used resources when consumers search for a new deposit account.
Among those planning to open an account, 55% expected to use the internet or social media, compared with 53% who planned to seek advice from family and friends. The shift is particularly pronounced among Gen Z, which was significantly more likely than the other generations to rely on the internet and social media when deciding where to bank.
There's nothing new about consumers going online to research financial products. But those online searches aren't just about comparing rates, fees and product information anymore. Consumers are also looking for recommendations from people they've never met.
Trusted Source Of Financial Guidance
We heard that directly from Michigan consumers. One needed an account where student loan refunds could be deposited quickly. They turned to Reddit, saw multiple people recommending the same credit union and decided to open an account there. Another saw SoFi ads and later heard a YouTube creator they followed recommend it for high-interest savings. People are increasingly willing to place trust in content creators and other voices they encounter online, expanding the idea of who can be a trusted source of financial guidance.
When people want hard facts about rates, fees and products, our research suggests that search engines and financial institution websites play an important role. And traditionally, family and friends have been more influential when consumers want to know about the softer side of the experience. Is this an institution I can trust? Will they treat me well? Are they easy to work with?
Social media and online forums are beginning to blur those lines. An Instagram reel can tell someone about an account feature while also providing a firsthand account of what it's like to be a member. A TikTok creator can explain a savings product and offer an opinion about the institution behind it. In other words, the kind of consumer validation that once happened person to person can now happen online.
That influence matters even more when we consider how quickly these decisions can happen. In Michigan, 42% of recent account openers went from deciding they needed to change or add an account to actually opening one in less than a week.
When consumers go about making these decisions, credit unions naturally want to be the best choice, and we have good reason to believe that our movement is the best financial option for a consumer. National research consistently shows that consumers trust credit unions more than banks. But consumers aren't always conducting the kind of side-by-side comparison that allows one institution to clearly "win." Instead of looking for the solution they trust most, consumers may simply be looking for the first solution they trust.
And increasingly, that trust is being shaped by what they encounter online. If a consumer's search can begin and end within a few days, the video that appears in their feed may carry more weight than we realize.
Decision In Someone Else's Hands?
At first, that might feel like it puts the decision in someone else's hands. After all, no credit union can control every conversation happening online any more than we can control every conversation between friends and family members. But we can influence what people say. That's where the premium our movement places on member experience, community involvement and consistently doing the right thing remains so important. Those experiences become the recommendations and reviews people share weeks and months down the line.
But we don't have to wait for those conversations to happen organically. If consumers are increasingly looking to content creators and other online voices for guidance, credit unions have an opportunity to work with trusted voices who can introduce the movement to people who might not otherwise consider it. That doesn't mean asking someone to deliver a sales pitch. The value comes from giving credible voices an opportunity to talk authentically about what credit unions offer and why they might matter to their audience.
That’s going to require us to think differently about awareness. For years, awareness has largely meant putting our message in front of consumers through billboards, digital ads, TV commercials and other advertising. But now, we also need to think about who they hear that message from.
Family and friends aren't going away, but they're no longer the only trusted voices in the conversation. For credit unions, that creates an opportunity to bring our story into the places consumers are already looking for guidance, and through voices they already trust.
Because if consumers are making decisions faster and listening to more voices along the way, it may not be enough to have the best story. We need to make sure the right people are telling it.
Patty Corkery is President/CEO of the Michigan CU League.