Get Active: Revive your Single-Service Sleepers

When you review your credit union’s unprofitable accounts, how many of them are inactive? Many credit unions find themselves with a segment of members who joined the credit union for a specific purpose (often a loan offer), and remain members with inactive low-balance savings accounts after they have finished using the product that enticed them to join.  These single-service households can become burdensome.  As you look for ways to expand your share of wallet among all members, a special focus on reinvigorating these single-service sleepers may help improve your profitability.

GET OUT YOUR MAGNIFYING GLASS
Examine.  Try to determine why these members are inactive and unprofitable by looking at vulnerability, profitability, and demographic details.  FIS (http://www.fisglobal.com/AboutFIS/index.htm) has tips on using analytics to help increase opportunities to leverage and expand customer relationships to improve your profitability. 1

KNOWLEDGE IS POWER
Educate.  There’s a good chance that when these members joined, they didn’t know a whole lot about your credit union – just that for a particular product, you had the best option at that time.  A targeted marketing effort can help you educate these members about what makes credit unions unique, as well as update them on current rates and offers that are available to them. The more tailored your cross-sell approach (What do they not have that they might need? Can you offer a better-than-market rate on another product?), the more likely you are to improve the relationship.

A LITTLE GOES A LONG WAY
Encourage. Involve your staff in seeking ways to improve relationships with members.  A recent CUNA study shows a more member satisfied means more loyalty and activity—both in using your products and recommending you to others. 2  Each time your employees have an opportunity to interact with a member, it’s an opportunity to build loyalty and prevent members from wandering into that inactive single-service category.  Develop and encourage an internal culture that supports loyalty—inspiring attitudes and behaviors.

ARE YOUR MEMBERS SEATED IN THE EXIT ROW?
Exit.  If you have made an ongoing effort to revitalize a non-performing member with no response, it might be time to consider an exit strategy for the relationship. You may want to consider charging inactivity fees or find other subtle ways of encouraging the member to move on rather than passively draining your resources.
It tends to be more cost effective to retain and develop an existing customer relationship than to acquire a new customer.   A strong service-oriented internal culture and targeted marketing efforts may just be the right prescription for your comatose single-service accounts.


1 Moed, Joyce. “Marketing and Sales Culture Target Inactive Accounts.” CU Times, 12/15/2010.
2 Credit Union Member Satisfaction, Growth, and Loyalty Report, CUNA 2010.

Northwest Georgia: Ringing in the New Year with Results!

With around $55 million in assets and two branch locations, Northwest Georgia Credit Union proves that savvy marketing and results-driven campaigns don’t just belong to the big boys.  In early 2010, Third Degree teamed up with the credit union to work on its brand position. (Check out VP, Creative Director Tara Street’s blog post showing the creative elements.

Northwest Georgia engaged Third Degree to put together an “un-banking” brand story to separate the organization from local banking competitors in Rome, GA. The campaign began running in April with three main goals:

1. Reduce membership attrition;
2. Increase annual loan volume by 10%, and;
3. Increase the amount of member services utilized per household.

RESULTS WITH MEANING
The results? In 2010, Northwest Georgia saw a 1.6% increase in membership, a 56% increase in annual loan volume, and 1.6% increase in member services utilized by household. Mission(s) accomplished!
With the new brand up and running, Northwest Georgia and Third Degree then collaborated on a mid-year auto loan campaign. After great success with high-yield checking in recent years, the credit union needed to increase its lending (like many credit unions around the country).

MORE BANG FOR YOUR BUCK
Starting the third week in July and ending in November, this program saw some big results. Northwest Georgia exceeded its loan goal by a whopping 82%. Plus, the auto loan campaign had a residual effect of drawing attention to the credit union’s overall lending product portfolio which led to a 25% increase.
So, this small credit union is proving that, “If you can’t run with the big (err, I mean small) dogs you better stay on the porch!”

Social Media Matters: Twitter "Virtually" Grounds Qantas

Social media doesn’t matter? It’s too complicated to figure out how to best use? Don’t tell this to the CEO of Qantas Airways, Alan Joyce.  After reports of aircraft parts dropping in Indonesia this past November, the Twitter world became a rumor mill leading to speculation of a Qantas plane crash. News outlets even began to pick it up. It was untrue, uncontrolled and not only impacting the company’s reputation but its financial position.

LESSON LEARNED
According to the article in the Wall Street Journal (December 28, 2010), Joyce noticed that share prices declined over 5% in half an hour (currently, the stock is around $2.30). Apparently investors had seen the tweets and, in a panic, started selling their Qantas stock. After confirming that the plane was safe and on the ground, Qantas quickly issued a media statement and pulled together a press conference with the CEO out in front.  All actions were part of a crisis communications plan, which had not included social media. Since this incident, Joyce has hired an entire team of people just to keep an eye on the social networking side of things. This team has already prevented other rumors from starting and spreading with regular tweets, Facebook updates and conversations with the public and media online.

FACING THE FACTS 
Like many companies (even large ones like Qantas), credit unions and marketing communications firms are still determining how to best strategize and utilize social media, one thing certain is that not participating is not an option. Whether you want to or not, your credit union will be a part of the chatter. The question is, will you be leading, following or scrambling to react to the virtual world?

Critchlow, Andrew and Kelly, Ross. “Qantas Copes With Aftermath of A380 Crisis.” The Wall Street Journal. 29 Dec.2010:B4.