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  • Target Market: Hispanic Small-Business Owners

    Posted by on May 28, 2013

    Did you know that between 2002 and 2007, the number of Hispanic-owned firms grew by nearly 50 percent? Today, Hispanics own 2.3 million businesses, or 8 percent, of all U.S. non farm businesses. What kind of a financial opportunity does this represent for your credit union? A large one.

    In certain states, the opportunity is particularly clear — for instance, 8 percent of all Nevada businesses are Hispanic-owned. In California, that stat jumps to 17 percent. The states with the highest growth rates for the Hispanic community are in the Southeast, Midwest and Mid-Atlantic regions. As entrepreneurialism and a strong work ethic are strong tenets of the Hispanic culture, it stands to reason these regions are about to see an explosion in the number of Hispanic-owned businesses.

    Like most small businesspeople, Hispanic leaders need strong guidance, both financial and otherwise, to achieve and maintain success. And credit unions in particular, with a focus on the “people helping people” philosophy, understand serving this disproportionately underserved community is not only an investment in the sustainability of their cooperatives; it’s a way to continue supporting their collective mission.

    The potential to increase business revenues can be seen in the simple fact that Hispanic-owned businesses have a tendency to generate average annual incomes well below the average in the U.S. (even below the average for minority-owned businesses). Lower-than-average income from these businesses may be due to the challenges Hispanic Americans face when it comes to founding and maintaining a successful business, namely limited capital and access to credit. And, often Hispanic business owners are on their own, without the benefit of boards of directors, shareholders or even executive teams. This underscores the importance of leadership support and guidance for this critical segment of the Hispanic population.

    This blog is an excerpt from the new Coopera white paper, “The Multifaceted Hispanic Market,” available for download at http://tinyurl.com/c8jwf45.

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    Training Is a Key Part of the Process

    Posted by on May 21, 2013

    Implementing a successful Hispanic outreach program takes more than just translating a credit union’s marketing materials and collateral. As the employees of Fitzsimmons Federal Credit Union (FFCU) of Aurora, Colo., have discovered, training is a key part of the process.

    Taking advantage of Coopera’s expertise in both the credit union and Hispanic markets, FFCU has put an emphasis on training its staff over the last year. The goal? To strengthen the credit union’s internal infrastructure to better serve Hispanic members today and in the future.

    These efforts have included:
    – Regular attendance of Coopera’s Hispanic-outreach webinars
    – Bi-monthly staff meetings
    – Utilizing Coopera’s resource library
    – Monthly consulting with the Coopera client services team
    – Adding bilingual employees

    “We have made a commitment at every level of our credit union — the Board of Directors, executive management and staff — to learn as much as we can about the Hispanic community, particularly their financial needs,” said Sandy Neves, president and CEO, FFCU. “Through training, we have also come to understand how to apply what we know to each and every member interaction.”

    Through these efforts, FFCU has come to realize why training is such a necessary part of implementing a successful Hispanic outreach program. “We knew we had to get our internal structure in place before we could reach out to the Hispanic community. Coopera’s trainings are really comprehensive, and we are learning so much,” said Neves.

    “Training has definitely kept our staff engaged, focused and excited during the implementation process,” added Neves. “And, we’re realizing that everything we’ve learned will help all our members, not just Hispanic members.”

    It’s not only Neves and her management team who are impressed with the results. Here’s what FFCU’s employees have said about the benefits of training:

    “I speak Spanish a little bit, so I am somewhat familiar with the language, and I have been viewing the webinars from Coopera. I think they are a great resource, and all staff should view these webinars.”

    I believe having more Coopera training would be helpful. The webinars have been great resources.”

    “Partnering with Coopera has been very beneficial in guiding the credit union in preparing to enter the Hispanic market.”

    “We have received a wealth of resources from Coopera that will assist us.”

    “The Coopera webinars provide a lot of additional information and are a useful guide to the Hispanic Outreach Program.”

    “I appreciate continued education about the Hispanic culture, specific products and services and language. We are gaining this through our partnership with Coopera.”

    Neves noted that Coopera has learned a lot from FFCU through the training process too. “They ask us a lot of questions about our local market and have gained a better understanding of our Hispanics’ unique cultural and financial needs,” she said.

    And, according to Neves, this insight has allowed Coopera to better help FFCU tailor its approach to their local market. This is particularly important when it comes to breaking down any barriers or misunderstandings FFCU’s local Hispanic community might have about the U.S. financial system or how to highlight the credit union advantage.

    Leading up to the implementation of FFCU’s Hispanic outreach initiatives, the credit union also engaged Coopera to conduct a Hispanic Opportunity Navigator and marketing analysis, as well as perform translation services and make the El Poder es Tuyo website available to members.

    “Hispanics aren’t just another demographic,” said Neves. “Growing our Hispanic membership base is central to our current and future growth strategies. We could not have done this without Coopera’s help.”

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    Target Market: Second Generation and Gen Y Hispanics

    Posted by on May 14, 2013

    The U.S. Hispanic market’s sheer size, youth and rate of growth has many in the financial services market understanding now is the time to adjust for service to this critical consumer segment.  Part of the draw to serving Hispanic consumers – particularly for credit unions who struggle with aging memberships – is the unmatched youth of the U.S. Hispanic market.

    For this reason, targeting “second-generation,” or children of Hispanic immigrants, is a smart strategy for credit union leaders who want to introduce their cooperative to the next generation of financial-service consumers. Beyond this target market’s youth, second-generation Hispanics generally have higher incomes, more degrees and own more homes than their parents, making them attractive financial clients. In fact, 91 percent of Hispanic youth agreed with this statement: “No matter how poor you start out in the United States, with hard work you can achieve success.”

    The possibilities for credit unions to act as a partner in the pursuit of this belief is equally as strong, as many young Hispanic members will have part-time jobs with income streams at younger ages. Couple this with a need for education, lifestyle and auto loans, and the value of a credit union to a young Hispanic American becomes clear. If established early, that relationship is likely to grow over time, as members enter adulthood, their careers grow and they begin to upgrade vehicles and purchase homes.

    Communicating this ability and willingness to help young adults reach their financial goals will be less complicated with second-generation Hispanic consumers, as 93 percent report they speak English either very well or well. That said, this audience is typically bilingual, with 8 in 10 second-generation Hispanics reporting they converse either very or pretty well in Spanish.

    Understanding which segment of the Hispanic youth population best aligns with a credit union’s value proposition and strategic growth goals is an important first step to the development of a plan to serve young Hispanics.

    This blog is an excerpt from the new Coopera white paper, “The Multifaceted Hispanic Market,” available for download at http://tinyurl.com/c8jwf45.

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    Case Study: Targeted Programs Focus on Members’ Lifestyle Needs, Not Cultural Differences

    Posted by on May 7, 2013

    What follows is a case study excerpt from the Hispanic Opportunity Report developed as part of the California and Nevada Credit Union Leagues’ newly formed partnership with Coopera.

    In 2004, Great Basin Federal Credit Union of Reno, Nev., recognized how fast the Hispanic population was growing in Washoe County. Indeed, it was projected to reach over 30 percent of the county’s population in the coming decades. The credit union’s leadership knew it was the right time to showcase its differences from other financial institutions (FIs) in the area. Offering better programs and services to meet the financial needs of Hispanic consumers was one way they set out to do just that.

    “Great Basin strives to enrich the lives of its members, regardless of heritage or nationality, through education and financial excellence,” said Elisabeth Hadler, Great Basin FCU marketing manager. “As a financial cooperative that focuses on service, not profits, we work to build personal relationships with our members to best understand what they need from their financial institution.”

    Driven by its people-first philosophy, Great Basin FCU set out to implement Hispanic outreach efforts focusing on lifestyle needs rather than cultural differences.

    Before they could focus on outreach, Hadler said, Great Basin FCU worked to implement an internal infrastructure to accommodate their upcoming efforts. They hired more bilingual staff and gave pay raises to those staffers who learned Spanish. At one point, up to 50 percent of the staff boasted bilingual capabilities. Great Basin FCU also partnered with specialists to offer a series of diversity and language training programs for employees’ ongoing education.

    The cooperative also programmed its phone system to offer its menu and directory assistance in both English and Spanish, as well as set up a special voicemail inbox for Spanish-speaking members who were invited to leave messages with their specific questions or needs. Great Basin FCU also put processes in place to ensure Hispanic members who visited any of their branch locations were able to conduct all meetings and transactions with a Spanish-speaking employee.

    “Our membership responded really well to the processes we implemented to bolster our Hispanic outreach efforts,” said Hadler. “Through these steps, we were able to build loyalty with our current membership and gain an awareness and trust with prospective members.”

    Once the internal infrastructure was in place, Great Basin FCU turned its attention outward, said Hadler. To build relationships in the communities they serve, the cooperative also joined the local Hispanic chambers of commerce and encouraged employees to attend local Hispanic community events.

    The cooperative also initiated member workshops in Spanish to connect financial literacy with Hispanics’ particular banking needs, as well as to educate members about their home buying and credit-building programs. These workshops were designed to help members better understand the importance of building credit, how to maintain good credit and how to decipher a credit report, among other credit-related topics.

    Great Basin FCU also had implemented an indirect lending program for consumers to receive pre-approval and financing options on-site at local car dealerships. The program removed an extra step in the car-buying process, eliminating the need for the car-buying member to visit a Great Basin FCU branch location to complete the vehicle purchase.

    One popular program for Great Basin FCU members has been the Directo a Mexico program, noted Hadler. Directo a Mexico is a wire-service program designed to offer members a more affordable way to send money outside the U.S. Transfer processing fees are waived for core credit union members who transfer money from Great Basin FCU to another FI outside the United States that participates in the program. For customers who are not core members, transfer process fees can be as low as $10, compared to more costly fees of $35 for transferring money to FIs not part of the Directo a Mexico program.

    When the 2008 recession hit, it was a struggle for Great Basin FCU to maintain its outreach efforts, according to Hadler. “The economic downturn really limited the time and resources we were able to devote to our Hispanic outreach efforts,” said Hadler. “Because of the costs involved, we scaled back on our bilingual marketing materials, and we found it harder to retain bilingual staff. And with changes in compliance, we found it even more challenging to track and measure the success of our programs.”

    That said, Hadler noted the cooperative worked hard to keep programs like Directo a Mexico in place. As well, the credit union has continued its internal processes to offer members in person and over-the-phone service in both English and Spanish.

    “Over the years, Great Basin FCU has grown its Hispanic base to be more than 25 percent of the 150,000 members we serve,” concluded Hadler. “We’re proud that even in the face of economic uncertainties, we made the right decision, continuing to offer the financial programs and services the Hispanic market needs most.”

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