“Member acquisition is tricky!” Shana Richardson, CEO of Ser Technology, a target marketing and lead generation firm, exclaimed, empathizing with credit union marketers everywhere. Still, with the right combination of brand development, thought leadership and lead generation, credit unions can build an effective program for bringing in new members.
“Brand development should be authentic. Tell consumers exactly why your credit union is for them,” Richardson advised. “Focus on the less tangible, but priceless benefits of joining a credit union, like community connectedness, trust, belonging, neighborhood improvement, personalized experience and shared ownership.”
Credit unions have a real advantage in differentiating themselves from their for-profit competitors. It’s critical to make those values known, Richardson said. She added, “Credit unions can share their unique stories through content for the website, in blogs and educational offerings, slick mobile apps, email marketing messaging, social media accounts and other outlets that speak to the emotions, needs, and questions of the members you would like to attract.”
Some of the most effective marketing drives leads through referral programs. Consumers tend to trust family and friends above other information, so creating a great experience for your members and incenting them to invite others is an efficient and effective way to get the ball rolling. Richardson explained that numerous credit unions, like Mission FCU in California, Prestige Community CU in Texas and Meritrust CU in Kansas, are gaining members through refer-a-friend programs. She cited an article from The Financial Brand that reported an estimated 30% of credit unions have similar programs. “These promotions create simple and straightforward incentives for members to bring their eligible friends and family into the organization's fold,” Richardson said. “Research shows that the average cost-per-acquisition for banks and credit unions can soar. Successful member acquisition programs require consistency and focus, but they can certainly yield positive and profitable new relationships.”
Credit unions are uniquely suited for targeted marketing, Richardson said. Field of membership attributes define a credit union's unique business model. To that degree, spray and pray marketing can be more expensive and less effective for the majority of credit unions. She continued, “Credit unions have access to rich data sets through their core and digital banking systems, so targeted marketing is a matter of matching data to the needs and desires of the intended audience. And, one of the major benefits of targeted marketing is distributing your message to an audience that is more likely to respond.”
Some credit unions are wary of targeted marketing because they fear excluding members or potential members. Targeting may reach a smaller market, but done right, you’re only excluding people who are unlikely to borrow or save with you. “Don't waste your marketing budget on a non-converting audience,” Richardson recommended. “Targeted marketing has a smaller reach but produces better and more accurate results than mass marketing, because it is designed around specific member needs and preferences.”
Data is the future of many businesses in general, and marketing in particular. Ser Tech has been offering highly targeted marketing for 25 years. Ser Tech Chairman Mike Covert explained, “Expansion is best managed by knowing what members and potential members are doing outside the credit union and credit files are great sources of information at both the member level and across the entire field of membership. For instance, by monitoring your targeted consumers credit inquiries each day, you can know the exact time when a member is in the market for a particular type of loan.”
Covert offered credit cards as an example. If you follow your members' payment behavior over time, you can learn how they manage revolving credit. Tailor your offers and services to meet members’ needs, whether they’re revolvers or they pay off their balance each month. He added, “You can always look at existing loans at other institutions and offer to refinance them when you know you have a better deal.
“Using broader analysis, it is possible to know if a market segment within the membership is underserved, not just for those members with lower incomes or lower scores, but for entire loan portfolios that might be going to competitors. These types of analytics can be applied to both existing members and membership expansion.”
Onboarding upon acquisition is critical, so providing value adds are crucial to keeping members coming back for more. Since the onslaught of consumer data breaches, consumers have been monitoring their credit more closely, but most ‘free’ credit score services are really just lead generators for a variety of lenders, according to Covert, so they have to be generic enough to serve all of the lead generators’ clients. Providing a real FICO credit score is definitely better for your members in the long run, because then they know exactly what lenders are considering when making loan decisions. Pairing that with education on how to improve their scores is another great value add that also helps protect the credit union while reinforcing its message and mission – delivering on that brand promise that brought members in from the start.