Content marketing is a kind of marketing strategy designed to attract and nurture inbound leads. It relies on maintaining a consistent and prominent online presence to show up in peoples’ internet searches. Can credit union content marketing work?

Few credit union marketing strategies are exactly alike. Each credit union fills a unique niche and appeals to particular local community. Each credit union offers something that other financial institutions near them don’t.

With quickly evolving technology and the popularity of online and mobile banking, traditional marketing avenues are changing as well. Content marketing can help credit unions reach prospective members who turn to the internet first to gather information about companies, products, and services that interest them.

Continue reading “Does Credit Union Content Marketing Work?” →

Credit union membership growth! How do you measure it? It seems like a simple question, just like “where can I get the best burger in town?” seems like a simple question. However, once different interpretations of what constitutes a new member—or a good burger come into play—things don’t stay so clear.

I have been on the Board of Directors at South Bay Credit Union for the last 11 years. At almost every board meeting, our COO delivers the monthly new member report. We seem to grow by a certain percentage each month, yet we have had roughly the same number of members for the last decade. How does that happen? Member attrition.

Understanding Credit Union Member Attrition

Member attrition is not a focal point of many credit unions. It certainly wasn’t for SBCU until just last year. I don’t know why I had that epiphany about focusing on attrition, but I did.

It forced us to focus on why members were leaving, which members were leaving, and where they were going. In my opinion, there are members whom we don’t mind leaving. Let that sink in for a minute…

Not all members are good members participating in the cooperative. Just like a team is only as strong as its weakest player, a cooperative is only as strong as its weakest link. Think of the Great Wall of China. It kept China safe for centuries until the gates were opened from the inside and the Mongols walked right into China and took over. The weak link was the open door in the hundreds of miles of brick wall.

Armed with the data on which members we were losing, why we were losing them, and where they were going, we were able to address a growth strategy in a tactical manner. Intuition is great, but data is factual. Using data, we were able to “farm” our existing members and cultivate those members to be our most profitable and highest participating members.

Knowing why members leave and which ones you want to keep allows you to fix the reasons why those members leave. The first step in membe

r growth is to stop the bleeding. You can add 50 new members per day, but if you’re losing 50 per day as well, you’ll never grow.

Credit Union Size vs Member Growth

Now that we have fixed the leak in membership, it is time to start adding net new members. Take a look at this study from NCUA. Can you explain to me why the larger the credit union, the greater the new member growth?

My guess is that the larger credit unions grow because of their ability to spend on advertising. TV, radio, print, online, etc. are all things smaller credit unions struggle to do at scale.

However, that is changing daily. We are moving from a one-to-many toward a one-to-one marketing environment. Tailoring the message to the individual potential member you are targeting is a much more cost-effective way of doing this.

Credit Union Member Growth via Smarter Advertisement

One-to-many marketing does work. It’s inefficient, but it does work. One-to-one marketing works better, though. If you know who you’re marketing to, you can ensure that you and your prospect are well-suited to one another.

To put it in terms you might be more familiar with, think of it as the RFP process. If I run a core provider or mobile banking provider, I probably get 50 or so RFP’s to complete each month. Some vendors will complete all 50 and hope for the best. If they complete all 50, they will likely get included in 25 searches, do 10 demos, and get 5 new clients. The more efficient vendors will evaluate all 50, score the potential for winning by developing an ideal prospect persona, reply to those 25 that fit their ideal client profile, do 20 demos and get 10 clients. Double the clients, half the work, a pretty good model.

New member acquisition is the same. You can advertise to thousands with your generic message, onboard as many as you can, and then have 40% of them leave because they are not a fit for your credit union (they are not your ideal member). Or, you can use technology to find the potential members that fit your ideal member persona, target them specifically, and onboard the same number of new members who will not leave. And you can do that for half the cost.

The first step is identifying your ideal member or persona, which you will have already done while examining member attrition. Then, find the right partner to help you put your message in front of them at the right time in the right context.

There are several examples of this being done and CU 2.0 would be happy to help you. Contact us here.

And, for the record, the best burger in town is from In-N-Out.

A recent survey showed that credit unions and their members are looking for different things from their credit cards. In fact, 76% credit union card goals were aimed toward growth, while the rest prioritized member services. But here’s the rub: 100% of members polled listed “false declines” as their number one service issue for credit cards. 

Clearly, there’s a disconnect between member experience and credit union card goals. Growth is a good end goal but making sure existing cardholders feel taken care of is paramount for retention.  There is nothing more frustrating to a member than a false decline in the middle of a busy day. 

Why Card Declines are a Problem 

Speaking from personal experience, I know how frustrating a false decline is. Recently, an old friend came through town. We caught up over drinks and because we were on my home turf, I offered to pick up the tab. My card was declined. 

It worked out in the end. I pulled out a different card and paid with that. Nevertheless, it was surprising and a little bit embarrassing. 

Imagine if I had been out to dinner with a new prospect or client. A hiccup as small as a false decline could have signaled that we weren’t ready or able to take on their business. 

False positives on credit cards can be as high as 90%. I’ve held my fair share of cards over the years, and I relegated any credit card that couldn’t consistently function properly to the back of my wallet. Credit union card goals should include reducing false positives to better align with member needs.  If you want your credit card to be top of wallet – focusing attention on reducing false positives is as important as your rewards programs. 

The Road to Redemption 

An unused credit card in the back of a member’s wallet costs a credit union money, reputation, and relationship trust. Unfortunately, many credit unions aren’t sure how to address false declines, because they want to maintain security and reduce the risk of fraud. 

Reassessing your credit card processor could be your best move. In your RFPs and vendor research, pay attention to false positive decline rates. Also, you can group issuers and acquirers together to see both sides of transactions. Strong data analytics and machine learning can aid in reducing these kinds of problems. 

Another option is to try a pilot with Flexpay to help find and tune your fraud prevention.  Matching up your transaction history with Flexpay’s merchant history will enable you to reduce fraud and improve the member experience.  Best of all, it’s a pilot – so there isn’t any cost! 

In an Ideal World… 

Nobody should have to rifle through their wallet to find a card that won’t mistakenly decline purchases. Or worse, nobody should be left without a way to pay because of an inadequate processor. 

Credit union card goals should align with member credit card needs. Members need credit union credit cards that they can trust. Problem-free credit card processing reflects well on the credit union and its sophistication, which will increase their confidence in other available services. 

The best part of reducing false positive decline rates is that it will inspire member confidence in their credit cards, which will aid growth and reduce attrition. 

There are two ways you can give members what they want: first, you can ask your card processor to prioritize false positive declines. Second, you can join our effort to connect merchant data and credit union data via machine learning. Together, we can reduce fraud risk while maximizing member approval. 

Are you interested in trying a pilot with Flexpay? Fill out the form below today!

 

As small niche financial institutions, it is imperative that we don’t lose sight of who we serve.  It is essential to your credit union’s survival to be highly focused on your niche and to customize and personalize your credit union’s solutions. One of the most essential ingredients in this process is how to connect with your member.  Now, what do I mean by connecting?

Connecting is about being highly relevant and memorable at multiple levels.  This starts with the aggregate credit union brand, moves to the products & services, and ends with the individual member.   At the end of the day, if you can create continuity between all three levels you will have members that love you. This is the goal. Members who love your credit union then tell your story and bring their friends to you.

There are three things that can help you better connect with your membership.

Utilize video to Connect with Members

Video is becoming highly important in today’s digital world.  In the next few years, it is anticipated that more than 80% of all content consumed online will be in video.  Your credit union’s website, member interactions, and content should all be heavily reliant on video first.   Every website should have biography team videos, a video on the problems you solve for members, video member testimonials, and at least one video on EVERY page.  All these videos won’t happen overnight, but list out all the videos you need, prioritize, and start tackling the videos one at a time. Rome wasn’t built in a day, but it is time to get working on the foundation!  Videos are an essential way to connect with your member.

Connect with Members with a Blog

Now I know what many of you may be thinking, blogs are stupid and no one reads them.  Not true! A blog is simply a more frequent newsletter that allows you to maintain consistent communication with your members.  It is also a key way to train Google on the problems your credit union solves and the community you serve.  Your blog should not be an in your face marketing channel. Members will not click on and read your blog regularly if it is sales pitch after sales pitch. Regular distribution of educational content is a great way to connect with your member. Your blog should be simple quick articles, community news, and things that are relevant to your members. Don’t forget to optimize your posts for keywords and Google.

Use data and machine learning and other tools to hyper-personalize.

Amazon is an example of a company that is a rock star at this.  If you and I both pulled up Amazon on our computers right now, we would see different things based on our historical purchases and what Amazon believes might be interesting to us.  However, your credit union website looks the same to everyone who pulls it up.  The offers on your website are not personalized to the member.  To stand out and be relevant, credit unions should be using analytics, machine learning, marketing automation, and website design to highly personalize every interaction with a member.  The most important ingrediant to connect to your member is personalization.

Ultimately, connecting with members is what it is all about.  Seeing the difference your credit union makes for each and every member is highly rewarding.  Smart use of video, blogging, and data will allow your credit union to enhance those connections and make you highly relevant to your membership.

Originally published on August 1, 2018 on CUInsight

Many Credit Unions measure the success of a marketing campaign solely with “home run” metrics. For example, a car loan promotion is measured in number car loans booked, and a credit-card campaign in the number of cards delivered. While there is no question that won/loss metrics are important, there is a middle ground that can give you richer customer information as you work to build member relationships rather than just achieve sales. At CU 2.0, we train our clients to use this technique, called lead scoring, as part of their digital transformation.

What is Lead Scoring?

In a typical Marketing/Sales environment, lead scoring is a system for ranking prospects against a scale that represents the perceived value each lead represents to the organization. The resulting score determines which leads the Marketing and Sales departments will engage, in order of priority. For example, a lead with a high score that indicates the lead is ready to make a large purchase soon might be handed off to a regional salesperson, while a lead with a low score is put in a Marketing “nurturing” campaign.

In a Credit Union environment, we see lead scoring as a way to track and enhance the relationship between the Credit Union and the member. Most Credit Union missions include improving the financial well-being of their members in addition to “making sales.” Credit Unions can use lead scoring to track a sales cycle and also to track a member’s financial journey and the strength of the relationship with the credit union.

By using all data from a campaign, and analyzing actions taken by members over time, we can develop a comprehensive ability to further serve the membership of our Credit Unions. By tracking a member’s actions (and lack of action) and assigning a “score,” we can offer more relevant information to help members take advantage of the knowledge and expertise at your credit union.

How Does Lead Scoring Work?

We’ve found that specific scoring methods are unique to each Credit Union, but the general idea is the same. As a member participates in email campaigns they accumulate “points.” In a typical sales environment, the points tell where the “prospect” is in your sales process–your lead funnel.

A Credit Union might modify their scoring system to account for financial lifecycle (first car, first house, etc.), financial health, the closeness of the relationship in terms of the number of products owned (or years of membership), or any other measures that help the credit union assess the member relationship. Each action a member takes helps you understand what specific information you can offer them. Sure, having them close on a car loan is great, but what if they simply aren’t ready? If they’ve shown some level of interest, it’s better to put them in a follow-on campaign rather than starting at square one.

Here is a simplified example of the car loan lead scoring:

Just by receiving the email (it didn’t bounce!), the member starts at a lead score of 25. In this example, the maximum score is 50, so we could have behavioral scores and associated next-step actions that look like this:

By providing intermediate actions and involving members in blogs, surveys, and other activities, we provide better service and fulfill our mission of providing financial health information to our members. We’re also going to monitor the follow-on campaigns and update their scores based on continued interactions. You can see that we quickly have a web of online interactions, and the lead score is our key indicator for assessing the overall relationship.

Monitoring campaigns and customer interactions at this level of detail can be more work but is definitely worth the effort in the digital era. Think of this process as a way to improve customer engagement online, in the same way, that you might add a branch to be closer to your customers in the real world. The cost is less than branch operations and allows the member to engage with you at their convenient time – even when branches are not open. Digital engagement requires the same commitment to managing the data as Credit Unions have shown in managing branches. The new digital world that our members have become accustomed to leaves little choice!