RANCHO CUCAMONGA, Calif.—As year-end approaches, CO-OP Financial Services has unveiled what it considers to be the Top 14 Stories of 2014.
Shared during a webinar hosted by the company here, the Top 14 cover a broad array of issues. Participating in the webinar were Ryan Zilker, senior manager-market analysis; Michelle Thornton, manager, core products; Jennifer Kerry, VP-credit card services, and Amanda Smith, manager-emerging products.
Here’s a countdown of CO-OP’s Top 14, along with commentary on each.
#14. The Move from Omnichannel to Integration. While the two are quite similar, there are subtle but important differences, CO-OP noted. 2014 began with lots of talk about expanding the number of channels CUs use to talk to members, before that discussion began evolving. “In one regard, omnichannel is about many channels, but it’s often a reference to subset of channels, including mobile,” said Smith. “This has ushered in a new appreciation for self-service. For members, the expectation is that experiences will reach across channels.” That, said Smith, is “integration. That is the ability to connect. It’s not a channel, but an experience that is seamless.”
#13. Integration at CO-OP. Smith pointed to CO-OP’s Sprig solution as an example of integration within the company. Sprig is a virtual branch/virtual wallet that now includes a host of features, including the ability to conduct transactions across accounts at different participating credit unions, as well as real-time P2P. “It is all integrated into a single powerful member experience,” said Smith.
#12. Integration in Real Life. While credit cards appear on the surface as a standalone product, Co-op believes the integration of other channels is what sets its offerings apart, according to Kerry. Kerry specifically cited CO-OP’s CardNav solution, which lets members manage the use of their debit and credit cards using a smart phone. Members can turn the card on or off, limit locations where the card can be used, set thresholds for transactions amounts, and more, all of which improves security. “This is a way of supercharging your card because it makes the experience better, and it’s safer to use,” said Kerry.
CO-OP is now releasing a new mobile rewards app that allows members to review their rewards points, find merchants, redeem points.
“We think it’s a quantum leap forward,” said Kerry. “We’re seeing more and more credit unions taking interest in integrating features and also a more integrated experience for themselves on the operations side.”
#11, Partnerships and Focus. Zilker observed that the market is seeing pressure on “what we might call vendor excellence. As the need for technology, insight and expertise intensifies, you almost can’t afford a mediocre vendor anymore. We have been saying for years that cooperation is a key advantage for credit unions, and that’s never been truer than in the current environment.”
In CO-OP’s case, Zilker said that has mean working to leverage its investment in providers that include Alkami, ondot and Finovation. “They are going to help us be more nimble moving forward.”
#10. The Security Gap. CO-OP noted this top 2014 story actually began in 2013 with the Target breach which made everyone “fell vulnerable, and revealed how relentless data breaches are.” That security is critical given the dependence consumers have on technology. It cited research showing the average smartphone owner, for instance, touches that phone more than 150 times per day. All of that has created a new fear, “nomophobia,” or fear of not having a mobile device.
#9. Changing Attitudes Toward Security Technology. Thornton pointed out that 2014 debuted with a solid interest in EMV technology, and a general belief retailers and card issuers should be investing in EMV. “That all change September 9 when Apple Pay was announced, which uses tokenization. Before Apple Pay it’s safe to say very few credit unions had plans to implement tokenization. After September 9, the floodgates opened.”
#8. The New Engagement. CO-OP cited its own THINK initiative for this top story. THINK has become a year-round effort that includes the THINK website, Think it Out Regional events, and THINK conference, nearly all of which is dedicated to consumer engagement.
#7 Consumer Channel as Case Study for Reaching Consumers. CO-OP cited its consumer campaign that has targeted CU members and those who would consider doing so, with a special focus on Millennials and a message aimed at building a sense of community and explaining what a credit union is. Since the May launch of its effort, a “wealth of financial education” content has been posted. The campaign’s Twitter feed has 36,000 followers for its @innovatebanking on Twitter.
#6. Listen More, Talk Less. “That’s one consistent message that has been coming from every corner,” said Smith. “ We are really just trying to listen to what members are saying about our products and what they are experiencing. We are monitoring comments to shape product development. We really are listening more. To the extent we can provide products consumers really want, we will all be ahead of the game.”
#5. Suprising Millennial Facts. Among those facts: 96% are satisfied with their credit union; 42% would rather be without wallet and keys than their phone; 72% want to be their own boss; 54% prefer local FIs, and 27% say they’d benefit from a social savings club.
#4. Revenue. CO-OP noted that interchange is evolving, and especially feeling the impact of security. EMV adoption has been delayed on the debit side as the result of debate over how Durbin rules will apply, and how network routing will work.
#3. Harnessing the Hurricane. Thornton said this is about “the big change story that we thought was going to be around EMV that is now around tokenization. We realized we have to move quickly and decisively. On our part, as we were learning about Apple Pay and how to get tokenization set up with MasterCard and Visa, it’s been an interesting lesson. We are used to a certain pace and this experience shattered all of those expectations. One of the big things we’ve learned is that CO-OP and this industry is capable of doing more in a much shorter time than we thought we could.”
#2. Speed + Brilliance. “This has been a recurring theme,” said Zilker. “P2P payments in real time was a huge leap forward. Millennials want faster mobile payments, and 70% think payments will change dramatically in the future.” He cited the aforementioned CardNav solution as an example of this top story.
#1. Apple Pay. “Apple Pay was important on many levels,” noted CO-OP. “Apple finally entered the payments space, it opened the door for mobile payments, it brought other mobile payments products into focus for better or worse, and it revealed new strength for credit unions--the ability to think and move fast.”
