CU Difference Committee November 18, 2009 Michigan Credit Union League Livonia and Lansing offices

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Agenda I.Call to Order/Roll Call II.Minutes – August 25, 2009 III.Reports A.MCUL President & CEO/Committee Ex-Officio David Adams B.CU Difference Chairman Darren Cameron IV.Informational Items A. Invoices in Membership Package B. Creative Proposal for 2010 C. Research Results D. Tentative 2010 Meeting Dates VI.Adjournment

Call to Order/Roll Call – Minutes - Reports I.Call to Order/Roll Call II.Meeting Minutes - August 25, 2009 III.Reports A. MCUL President & CEO David Adams B.CU Difference Chairman Darren Cameron

IV. Informational Items A.Invoices/Membership Package One invoice for MCUL dues, CUNA dues, CU Difference contributions Asking for 2010 contribution plus 2009 and 2010 MCUL dues rebates Due out early December

IV. Informational Items B.Creative Proposal for 2010

TV Creative CreativeMessaging 1.GM TV spotGM offer/IIA 2.Chrysler TV spotChrysler offer/IIA 3.New TV SpotCU Branding Better rates/lower fees Safety/Trust Commitment/stand behind members and communities Not-for-profit/people focused

Radio Creative CreativeMessaging 1.GM radio spotGM offer/IIA 2.Chrysler radio spotChrysler offer/IIA 3.Invest in America radio spotInvest in America discounts 4.CU brand radio spotCU branding Better rates/lower fees Safety/trust Commitment/stand behind members Not-for-profit/people focused

Media Campaign plan weeks March/April start TV and radio Statewide Other considerations Web banners Collateral Web links to TV spots Web content

IV. Informational Items C.2009 research results

Overview/Goals Position credit unions as safe and secure Take advantage of unprecedented opportunity to step out as a safe, people- focused option Raise awareness of credit unions and programs Invest in America Increase membership overall Improve perception among consumers and lawmakers Cooperative advertising, grassroots lobbying and the Community Reinvestment Initiative (CRI) represent the MCUL’s three-tier approach to protecting and promoting the credit union difference Focus on what credit unions have in common Everyone can join Better rates, fewer fees Nationwide free ATM networks Great service

Timeline YearMedia CampaignsResearch 2004December (benchmark) 2005$2M TV/radioDecember 2006$1.1M TV/radio 2007 $500,000 radio (Comerica) $1.5M TV/radio January (2006) 2008 $1.5M TV/radio $750,000 radio (Trust) January (2007) August 2009$1.6M TV/radioSeptember

2009 Spending Summary DMA Amount Raised Total Spent TV/Cable Spots TV Weeks Radio Spots Radio Weeks Alpena $ 26, $ 22, Cass/Berrien $ 10, $ 9,646.02n/a Detroit $ 545, $ 514,928.38n/a Lenawee $ 8, $ 7,772.18n/a Flint $ 389, $ 342, Grand Rapids $ 344, $ 322, Battle Creek $ 27, $ 27,569.72n/a Lansing $ 161, $ 133, Marquette $ 54, $ 48, Traverse City $ 94, $ 94, Total $ 1,662, $ 1,524,064.45

Participation by Chapter ChaptersCUsCUs PaidNonaffiliatesAffiliated Participation Battle Creek871100% Blue Ox108189% Downriver217033% Flint145242% Grand River % Huron Valley105050% Jackson84157% Kalamazoo % Lansing138273% Metro East % Metro West % Mid-Michigan % Moon % Oakland County % Paul Bunyan163527% Southwestern65083% Upper Peninsula % TOTAL %

Methodology Telephone survey of financial decision-makers in Michigan 800 interviews Members vs. nonmembers tracked: 55% of Michigan residents are credit union members  Among nonmembers, 58% had been members in past MembersNonmembersTotal Detroit Grand Rapids Other DMAs Total

To understand if consumers are “getting” the CU Difference message Surveys look at campaign impact in several areas Awareness Usage/satisfaction Is everyone eligible? CU vs. bank attitude comparisons Invest in America discounts (new in 2009) Research Objectives

Key Findings

Advertising Awareness Respondents were asked about their awareness of advertising for “financial institutions” in the past six months 26% mentioned credit union, vs. 18% in % mentioned bank We still have some work to do, but have made great progress

Advertising Awareness

Interestingly, gaps in awareness (bank vs. CU advertising) were largest in Detroit DMA and among CU members 28 points 27 points

Advertising Awareness CU advertising awareness by nonmembers shows a significant and steady increase since 2004

Advertising Awareness 2008: 55% 2007: 49% 2006: 51% 2005: 56% 2004: 48% Total 2009 CU Ad Awareness = 55% Answered “Yes” to “Do you remember seeing or hearing any advertising about Michigan credit unions within the past 6 months?” Mentioned “Credit Union” when asked “For which types of financial institutions do you recall seeing or hearing advertising within the past 6 months?” 2009

Advertising Awareness Total hits on lovemycreditunion.org increased significantly over months that ads did not run on TV and radio

CU vs. Bank Image The gap between the CUs and banks grew in favor of CUs on many attributes

CU Image

Deposit Account Considerations Respondents were asked what type of financial institution would first come to mind if they wanted to open a deposit account Consideration of credit unions for a deposit account increased significantly while consideration of banks decreased significantly. The gap has closed from 22 points in 2004 to just 8 points in 2009

Lender considerations Respondents were asked what type of financial institution would first come to mind if they wanted to get a loan Total CU consideration is 57% vs. 68% for banks Don’t know: 10%

Credit Union Eligibility Reached a new and statistically significant high in 2009 Consistent increases since 2004

Credit Union Eligibility Understanding that everyone can join increased in each market as well

Invest in America Discounts Based on a new question added to the 2009 survey, more than one-third said they had heard about Chrysler and GM discounts to credit union members 14% of those respondents used the discount 67% of those financed their new vehicle through a credit union % Yes By Area / Subgroup: Total Michigan36% CU Members42% Non-members30% Detroit DMA31% Grand Rapids DMA41% Other Michigan43%

Invest in America Discounts How Did You First Learn About This Discount? TV28% Credit union20% Friend / relative13% Dealer11% Newspaper11% Direct mail 6% Radio 6% Web 4% More than one-quarter of respondents who heard about the discounts first learned about it on TV Study results suggest that CU Difference TV/radio ads were noticed by many consumers

General Opinion of Credit Unions Overall CU favorability was solid at 80% Non-members significantly higher in 2009 vs % vs. 58%

Overall Satisfaction 69% of CU members are very satisfied with their PFI For banks, 43% are very satisfied

Implications  Overall the research indicates that the cooperative advertising effort is effective and meeting its defined objectives Awareness: Continues to increase Deposit consideration: Gap between credit unions and banks closed from 22 points in 2004 to 8 points in 2009 Everyone is eligible: Significant gains in all media markets in 2009 that anyone can join Call-to-Action: Hits to increased dramatically

Implications Credit unions have made significant progress relative to banks Awareness Image Deposit consideration 2009 campaign was successful in “breaking through” to many financial decision-makers No proof that increase was caused by MCUL cooperative advertising alone. It is unlikely that a “statistically significant” difference between 2004 and 2009 would have surfaced without substantial advertising activity Statistically significant high of 55% understanding that everyone is eligible to join suggests that our advertising message has been “sinking in.” Credit union consideration for deposit accounts has been improving at the same time that bank consideration has deteriorated

Implications The average ratings on most image attributes were higher for credit unions than for banks This has been true each year the study has been conducted Credit unions did suffer declines on many image attributes, but banks suffered worse declines The gap in image between credit unions and banks grew significantly in favor of credit unions Despite image declines, 80% gave a “very favorable” or “somewhat favorable” rating for their overall opinion of credit unions CU members remain significantly more satisfied than bank customers With recent decline in image, credit union advertising should continue to encourage trust and to reassure consumers about the safety of credit unions The financial crisis is the likely culprit behind the abrupt and significant deterioration in image The average consumer does not necessarily distinguish which types of financial institutions were connected to the crisis

Implications Banks, with their much-larger advertising budgets, cannot be expected to sit still Future bank advertising is likely to attempt to heal recent damage It makes sense to invest as much as possible in cooperative advertising Maintain progress Strive for further gains

Bank/CU Spending Comparison GR/KA/BC/MN media market 2009 CU Difference (TV/radio) spend $349,546 Bank comparisons All financial advertisers  2008 TV/radio spend: $1,621,798  All advertising: $4,467,299 Huntington National  2008 TV/radio spend: $205,722  All advertising: $407,465 Fifth Third  2008 TV/radio spend: $294,719  All advertising: $645,824 This is what we are competing against! Here’s our impact.

Bank/CU Spending Comparison Flint media market CU Difference spend $342,380 Bank comparisons All financial advertisers  All advertising: $1,356,592 JP Morgan Chase & Co. (Top spender)  All advertising: $310,796 Fifth Third (2nd highest)  All advertising: $241, 247 National City Bank (3 rd highest)  All advertising: $203,048 This is what we are competing against! Here’s our impact.

Bank/CU Spending Comparison Detroit media market 8/1/2008 to 7/31/ Fall plus 2009 CU Difference spend $836,102 Bank comparisons All financial advertisers  2008 TV/radio spend: $13,525,867  All advertising: $31,683,737 National City (Top spender)  2008 TV/radio spend: $2,164,448  All advertising: $4,174,460 Fifth Third (5 th highest spend in market)  2008 TV/radio spend: $1,010,129  All advertising: $2,810,965 This is what we are competing against! Here’s our impact.

D.Tentative 2010 Meeting Dates Tuesday, February 16, 2010 Tuesday, May 25, 2010 Tuesday, August 17, 2010 Wednesday, November 10, 2010 VI.Adjournment Informational Items