Challenge Your Marketing Assumptions
Simple market research uncovers surprises that can benefit your CU’s bottom line.
Targeted marketing campaigns—taking full advantage of today’s technology innovations—can reveal incredibly useful information about your credit union’s members.
I learned this firsthand when analyzing the results of a recent campaign at my credit union. The ultimate purpose: to make more loans in a landscape of restricted loan decisioning and a shrinking pool of qualified candidates.
As I asked myself how the credit union could achieve this monumental feat, I realized I needed to know more about how our members took advantage of our auto loan offers. I needed to research our credit union’s current auto loan sales cycle.
All products and services have a sales cycle—the time from a new offering’s launch to its purchase. A defined sales cycle allows us to create accurate forecasts and make solid marketing decisions.
But first we must question our assumptions. Sales and marketing professionals have long assumed that an auto loan promotion lasting 30 days will yield member action on the offer within 30 days. While that might have been the case before the Great Recession, it’s not accurate today—at least not at my credit union.
To research member activity, I decided to track a segment of the membership through the auto loan process. The target selected was a preapproved auto loan segment.
In this particular case, the members received notification of their preapproved status in an e-mail with a link to a personalized uniform resource locator (PURL). The advantage of using a PURL is that the technology allows us to watch as members open the e-mail and access the preapproval. Then we can observe the actions they take, such as accepting and opening an auto loan with the credit union, visiting the loan page on our website, and so on.
In the first 30 days of the campaign, a small trickle of preapprovals produced credit union auto loans. In the next 60 days, we saw a similar trickle. But at 90 days, nearly three times the number of auto loans rushed in.
This was an interesting development, since nothing had changed in the offer. The offer ended at 30 days. Nothing changed with the loan process or the staff. Marketing to this group of members was made in the first 30 days and a reminder was sent in the second 30 days. But we sent nothing to members in the third 30-day period.
It caused us to wonder: If more members are waiting 90 days to take advantage of an auto loan offer, perhaps our credit union should:
- Rethink its sales cycle;
- Deliver follow-up communication to preapproved members at 60 days after marketing ends, in addition to the 30-day traditional reminder;
- Adjust loan goals for 90 days closing instead of 30 days;
- Offer members an incentive to open their loans in less than 90 days; and
- Create incentives for loan staff encouraging them to “work” the preapproved list—the more relevant the offers made to members, the more likely they are to respond.
This campaign is just one example of learning more about how members interact with your credit union. Another example is tracking the number of transactions members perform electronically.
Market research, particularly during challenging times, yields key information about members’ relationships with your credit union. This can lead to better and more realistic business decisions, which in turn allows your credit union to reach its goals.
ANNE LEGG is vice president, marketing, at Cabrillo CU, San Diego, and chair of the CUNA Marketing & Business Development Council. Contact her at 858-653-3295. For more information about CUNA Councils, visit cunacouncils.org.