Leverage Disruptive Technologies—or be Leveled by Them

Expect ‘free-miums’ and ‘crowdfunding’ to emerge as disruptive forces.

April 10, 2013
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Paul Gentile

Paul Gentile, CUNA's executive vice president of strategic communications and engagement, is the emcee of Credit Union Reality Check 2013 in Atlantic City.

“Credit unions must leverage new, disruptive technologies or they will be leveled by them,” Max Wolff, chief economist and senior analyst with GreenCrest Capital, told Credit Union Reality Check Conference attendees Tuesday in Atlantic City, N.J.

“You need to have a mobile-first mindset,” Wolff says. “Smartphones and tablets are the ATMs of 15 years ago. I teach college students, and many of them have never been to a branch office. They think going to a branch is kind of retro-chic—like making your own clothes.

“The disrupted economy has obscured and delayed some of today’s most disruptive technologies,” he continues. “When the economy fully recovers, disruptive technologies will emerge and take over as market leaders.”

One business model Wolff expects to emerge from the fray is the “free-mium” model where a product or service is given away for free until it gains a large following of users and then the provider charges a fee for the service.

Wolff says Dropbox file storage and sharing service is a prime example of this.

Wolff also expects “crowdfunding” to emerge as a disruptive force. facilitates crowdfunding,” he says. “The site raised $1.4 million to help build a Tesla electric car museum. Credit unions have a much more compelling social mission than a museum for electric cars. The challenge for credit unions is to use this emerging trend to their advantage.”

Wolff encouraged credit unions to embrace social media. He defined social-media success as having 25% to 30% of members visiting your site weekly.

“About 10% to 15% of your social-media visitors should be nonmembers, and you should have a consumer-friendly system set up to turn those nonmembers into members.

“Think outside the old banking box,” Wolff advises. “Virtualize everything you do. The tablet will be the device of the future. These trends were made for credit unions. You have a rare opportunity, but that opportunity is perishable.”

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