Credit unions can attract more deposits with motivational tactics, one expert says.
Using simple account information allows credit unions to determine if members have savings accounts with other financial institutions or brokerage firms, and if deposits are flowing out to those providers, says Rob Johnson, executive vice president and principal with c. myers, a strategic consulting firm.
“If money starts flowing from your accounts, it can be a good idea to track where the funds are going,” Johnson says. “Consider sorting outflows by the types of deposits, account balances, ZIP code, number of products members have with you, and even the age of the members who are moving money."
“This helps inform your strategy,” he continues. “For example, the approach you take if you determine single-product members are jumping to CD promotions is different than if multi-product members are moving big chunks of their relationship.”
Credit unions can attract more deposits from existing members by adopting motivational tactics that work outside the financial services industry. Look at lessons from retailers or even fitness companies, Johnson suggests.
He advises providing members with savings goals based on members’ age groups. This type of “peer competition” can motivate members of every age, Johnson says.
For example, a member in the 33rd percentile of savings for people ages 38 to 44 years old will want to take steps to move above the 50th percentile. “One way they might do that is by moving money from an account with another financial institution,” he says. “All of a sudden you’re not competing on interest rate.”
Another idea is helping members visually track their progress in meeting goals—and providing them with positive reinforcement. “It can be incredibly motivating to visually see progress toward a goal,” he says.
Johnson likens these approaches to how Peloton is recreating the stationary bike experience. “What they’re doing is not cheap,” he says. “But it’s about creating community, motivating people, tracking progress, and having fun.”