Looking Out for Your Members Matters

Posted by Christopher Stevenson

My wife and I have always had different perspectives on which major appliances we should purchase. When we bought out first home, I was pushing for something like this:

This fridge is 10 full cubic feet of cooling power. Wire shelves make for easy cleaning (except at the bottom where all the puddles form), the freezer isn't cluttered by unnecessary ice makers, and it's small enough that you never have to worry about losing your leftovers at the back of the fridge. To top it off, we could have picked up this baby for a song--around $300.

My wife, who is by no means a spender, convinced me that perhaps we should spend a few hundred dollars more to get something a little more practical for a growing family--something more like:  

Yeah, she was right. I was wrong. Twenty-one cubic feet works out better than 10. Glass shelves have some benefit. Deep shelves in the door work better than wire soda racks. It was worth the extra money. In fact, we still use this fridge as our second.

In a situation where I "won," I convinced my wife we didn't actually need a clothes dryer, that a washer and clothesline would be enough. After all, we lived in the desert at the time; how long could it take to dry clothes? Uh, in case you didn't know, deserts are sandy and come complete with desert wind. Sand + wind + clothesline + damp clothes = dirty clothes. Two months later we were back at the appliance story, checkbook in hand. 

All this backstory is to say we've gone appliance shopping again. This time to buy a whole kitchen full of appliances. My wife did most of the leg work. (I've stopped trying to convince her that the cheapest appliances, especially those with stick figures of chefs in their logos, are the best.) She visited half a dozen appliance and big box stores, checked brands' reliability and quality ratings, and got quotes for package deals. She narrowed our choice of vendors to two major retailers and then we went out together to meet with the sales associates.

The first store we visited had the kinds of appliances we needed at seemingly very reasonable prices. The sales associate was attentive and trailed us around the appliance department with spec sheets in hand, ready to respond to any question we had. Unfortunately, he didn't know any answers. He helped us add up the costs of the appliances and explained that there would be an additional $65 delivery fee for the package. That seemed fair enough. We asked him for an itemized list of the appliances and their prices, including all costs related to delivery and installation. On the back side of a sales receipt he jotted down the appliances and their costs. I expected to see the $65 delivery charge, plus tax. Instead, he kept adding costs to the lists--$65 delivery, $10 for removal of old appliances, $169 for the installation of the dishwasher, $20 for a hose, $20 for another hose, and on and on. And I got the feeling we wouldn't be surprised if the final cost ended up higher than what he had jotted down on the back of the receipt.

On to the next retailer.

The second place was one that I never would have thought of for appliance sales. I knew they sold appliances, but knowing the poor level of service in other departments, I never would have trusted the store with a multi-thousand dollar purchase. Turns out I was wrong. The sales associate spent over an hour with us discussing strengths and weaknesses of different brands, steering us away from more expensive appliances for cheaper, more reliable ones. He measured to make sure the appliances would fit in our kitchen, called his boss to get clarification on how much room the refrigerator would need for the ice-maker's hose, and even called competitors to check on their sales prices. We asked for an itemized list of the appliances and their associated costs; he gave us a computer-generated print-out that included all parts, delivery costs, and tax.

In the end, the second retailer's package price was about $500 over the price provided by the first retailer, but we bought from them anyway. Why? Trust. Knowledge. Education.

We felt like we were getting the whole story from the second retailer. The sales associate made sure we understood what we were buying. He realized that this was a major purchase and treated us like our money mattered. Knowing that we were well informed made it worth the difference in price (which, if you haven't picked up on it, is $200 more than I wanted to spend on our first refrigerator).

Earlier today, I posted a story on CUES Skybox about an interview with Members Credit Union President/CEO Jack Braswell that I read in the Winston-Salem Journal. In that interview, Mr. Braswell made it clear that his credit union's members and their economic circumstances matter. Throughout the process of buying a new home this summer, it was clear to me that Summit Credit Union here in Madison, Wis., holds the same position and demonstrates it through member education and ongoing support (which even included a Sunday afternoon phone call from my mortgage officer to see if I had any questions about my preliminary closing documents). Seattle Metropolitan Credit Union, GECU, ENT, Atlantic Financial FCU, Alternatives FCU, and many others consistently demonstrate the same dedication to the members' good. 

In today's market, competing on price is extremely difficult, but caring for the member sets the credit union movement apart from the rest of the financial service providers. In the end, I believe that will be what builds member loyalty and referrals. Few things make for a stronger brand promise.

Comments

[Credit Union Warrior/Matt Davis]

As someone who also just dropped a bundle on kitchen appliances, I must say that I wish I had known about your stick figure chefs directive earlier!

You touch on a very important point about big purchases. Such financial matters are a big deal to your members. What are you doing to help them make better decisions? I think credit unions have done an excellent job guiding members in vehicle and home purchase decisions, but what about large appliances? Home improvements? Cell phone plans?

I think credit unions can be more involved in consumer advocacy and education than they are. That's not a knock at what we're doing, just a challenge for us to do more.

[Christopher Stevenson]

Thanks, Matt. One of the things that popped out to me from your comment is the treatment of a cell-phone plan as a major purchase. It's something many don't really consider, but contracted monthly payments like cell phones, satellite TV, health clubs, etc. can make a big dent in monthly budgets. Heck, just three common fees, $75 for a cell phone, $90 for cable, $100 for a health club membership, add up to be a couple weeks worth of groceries for a family of four. I'm not suggesting we advise members to stop going to Starbucks ([sip] don't get between a man and his coffee [sip]), but a little additional education on the impact of payment plans could do a world of good for CU members.

[Mary Arnold]

Christopher, what stuck out to me on your purchase process is that you ended up going with a store you hadn't even considered, in part because your wife did extensive research. If credit unions haven't been branding themselves as that trusted advisor, they might not even be appearing on consumers' lists as potential providers.