By Walt Williams
At a time when “buy local” resonates with many consumers — particularly younger consumers — mutual banks believe their nontraditional business model is their strongest selling point. However, reaching and educating consumers about what sets mutual banks apart from other financial institutions remains a challenge for the sector.
HEAR THIS: Listen to Gregg Tewksbury and Lori Dufficy discuss Mutuals Matter on an episode of the ABA Banking Journal Podcast from December.
“When we move over to digital marketing, I think mutual banks and community banks in general are evolving, and some banks do it better than others, but not nearly as effective as some of the fintechs that are in our space and some of the larger banks.”
Last year, a group of 10 mutual banks pooled their resources to launch a joint advertising campaign to get the word out about how they differ from other financial institutions. Mutuals Matter takes inspiration from successful consumer education campaigns created by other industries, particularly the dairy industry’s “Got Milk?” campaign, with its famous photos of celebrities with milk mustaches.
Mutuals Matter doesn’t have the budget for A-list celebrities or 30-second Super Bowl ads. Rather, the goal is to provide mutual banks with a suite of advertising resources they can use as they see fit, and to give consumers an easy way to differentiate the institutions from competitors such as credit unions.
Tewksbury is one of the originators of the campaign and board chairman of the Mutuals Matter Association, a nonprofit organization established to oversee the effort. He says the campaign doesn’t need to move the needle much to have an outsized impact: If it helps mutual banks capture just 1% of market share in the banking industry, that will double the size of the sector in the U.S.
“We’re not saying other banks are not good. It’s not meant to be divisive,” Tewksbury says. “It’s meant to be educational. And if it resonates with a group of consumers because they understand our governance and ownership structure … we move the dial a little.”
Getting the word out
There are more than 400 mutual institutions in the U.S., according to FDIC figures. Mutual banks are owned by their depositors and customers, and don’t report to shareholders. This fact is central to Mutuals Matter’s messaging.
“It’s not just new customers. It’s also new employees and trying to educate people on the difference between a mutual bank, a stock bank, a family-owned bank, a credit union,” says Lori Dufficy, chief experience and engagement officer at Chelsea Groton Bank in Connecticut and treasurer of the Mutuals Matter board. “When people hear that mutual banks are owned by their customers, and we’re here for the sole purpose of the community, they start to think about their choices a little differently.”
One challenge for the campaign’s organizers is a lack of understanding among consumers about what separates one financial institution from another. As an example, Dufficy recounts a time when a local media outlet gave its annual honor of “best bank of the year” to a credit union.
“I had to educate them,” Dufficy said. “They didn’t know there was a difference. They just assumed [banks and credit unions] are all the same and they’re not. And that was the premise of Mutuals Matter. It’s about education and let’s help people make informed decisions.”
Coming together
The idea for a consumer education campaign had been floating around for several years before it materialized in Mutuals Matter. Tewksbury assumed leadership of New Hampshire Mutual in 2018 after having worked at a mutual bank several years prior. He had previously pitched the idea of marketing the concept of mutuality to the public and was told at the time that mutual banks have been trying that for roughly 100 years with little success.
“So I put it back burner but came back to it and put some of our own bank’s money into developing a campaign and a lot of collateral for what would it look like if we came together as an industry,” he says. “If we were unsuccessful individually, maybe we could come together as an industry.”
Tewksbury worked with a colleague who ran an ad agency to come up with the initial concept for campaign, then used that concept to pitch the idea to other mutual banks. He acknowledges that the pitch received “a marginal response,” but a group of mutual bankers ultimately signed on and pledged funds to the effort.
Among the early adopters was First Mutual Holding Company in Ohio. Tom Fraser, CEO of First Mutual and secretary of the Mutuals Matter board, says it just made sense for mutual bankers to start working together to share information and messaging on how they could work together to promote the sector.
“I think the winning argument was, individually, we’ve always struggled with how to describe who we are,” Fraser says. “So for all of us to come to the table and pool our resources to tease out what that message is, that was compelling. And also realizing those messages can sit side by side with our existing marketing campaigns and not distract from them but would help amplify them.”
Finding a message target
Mutuals Matter currently consists of a website and a suite of advertising resources for mutual banks that pay a licensing fee to join the campaign, which ranges from $5,000 to $10,000 depending on the size of the bank. A 90-second video spot on the site’s front page features a series of mostly younger individuals at work and play, with the narrator emphasizing the importance of community.
“When I put my trust in a mutual bank, I get something even more valuable in return: A promise to make a real impact on us all, on our future,” the narrator says.
Fraser says the messaging is meant to resonate with “purpose-driven customers” who skew younger than the typical mutual bank customer. “Speaking for my institution, the average age of customers is 58 or 60. They understand the value of thrift and savings… We think this resonates with younger customers who we want to obtain now, who would be customers for life, and [shows them] that banking local or working at a local mutual bank is something consistent with how they see the world.”
Mutuals Matter worked with the Rhode Island-based communications firm Duffy and Shanley to design the campaign and shape the messaging. The firm’s research suggests that millennials and Gen Z would be receptive to the community-first theme because they are socially conscious and value shopping at locally owned businesses, Tewksbury says. In other words, millennials and Gen Z are the type of people more likely to buy their coffee from a local coffee shop than a Starbucks.
Another thing the research showed: If someone already knew what a mutual bank was, then they probably were already a customer.
Younger generations “can’t differentiate you from some of the largest banks in the country,” Tewksbury says about the findings. “And if they understood a little bit more about who you are, it could be an important segment today and into the future.”
The immediate goal of the campaign is to get more mutual banks to sign up. Tewksbury says he has heard from a handful of other banks since Mutuals Matter first launched, with the campaign growing to 20 banks by the end of 2024. Still, those 20 banks are only a small percentage of the more than 400 mutual banks in the country.
“We’re thinking it’s going to take two or three years to really get some momentum, and hopefully we have enough,” he says. “What I’ve asked my peers in the industry is to give it a shot for a year. If it doesn’t work, if it doesn’t resonate, then it costs you a few bucks. If this doesn’t succeed, okay, so we’ve tried something. But we’ve got some groundswell.”
