Time to Kick Butt on Credit Card Promos

By John Blom and Margie Church

According to Bankrate.com, the average interest rate on cash back cards is 16.39%. Balance transfer cards come in at 16.14%, and rewards card rates at 15.48%.*

Those rates are higher than most credit union credit cards. Heck, they're even higher than a lot of personal lines of credit that credit unions offer, too. Lots of these cards feature 0% introductory rates and afterward, a variable rate. All this has me wondering why credit unions aren't knocking down doors with summer credit card promotions. Last time I checked (which was this morning), Americans were still trying to pay down their credit card debt and carefully manage any new debt.

If your CU offers a rate lower than these and especially if you have a fixed rate and no balance transfer fee, this seems the perfect time to offer a pre-qualified or pre-approved offer. Dig into your data to find those members without your card and give them a hand up, credit unions! 

A razor-sharp direct mail piece that illustrates the savings could be a welcome sight in your members' mailboxes. The lower rate just might make them feel better about using credit to have a little fun for a change. Transferring a balance to save on interest payments and pay off the debt faster can be a real relief.  

Include a Personal URL with your direct mail and email to make it easy to communicate to your member and get an immediate response. Sending an email as a follow-up to your product offer is also a friendly reminder!

Using pre-screened data makes this campaign targeted and super cost-efficient. The end result is a higher ROI and a high-five from your lending department. Maybe you'll even have some budget left over to run a second flight. And we all know how important frequency and reach are. 

In the member's eyes, you guys are heroes, and the relationship between you deepens. Looks like a win-win for everyone.

Summer credit card promotions.  Simple. Fast. Profitable.

Bankrate.com rates 6/21/2012.

Pinpoint Direct Marketing creates data-driven, electronic and print marketing campaigns for the financial industry. Its customized campaigns achieve excellent results without premium costs. Learn more about Pinpoint Direct Marketing at www.PDMKT.com or call Kerry Blom, owner, 866-784-7555.

Stop the Slow Leak in Your Auto Loan Portfolio

 By John Blom and Margie Church  Originally published on CUinsight.com.

Vehicle purchases frequently are impulse buys, and auto loans have become serious bread and butter to many credit unions. The wise marketer knows that getting a member's repeat business can't be an assumption. It must be earned as part of a strategic effort. 

"Hail Mary Marketing" has its place as a solid prospecting strategy. Use it to target members without auto loans and to create awareness in the communities the credit union serves. It works. However, this strategy isn't the best way to retain the valuable auto loan business the credit union already has. You need to have a more focused effort.

Stop-Leak Retention Strategies

We recommend developing a solid retention program today to keep millions of dollars in auto loans from leaving your credit union tomorrow. How? Bi-annually, append to your data with vehicle values to provide a good guide to how much equity a member has.  Sort the data, and create targeted messages depending on where this member is in their auto loan lifecycle. 

Here are the important markers to look for:

      The vehicle's trade-in value is higher than the loan balance. This is an open artery for an impulsive purchase. These loans are most vulnerable right now. These members must be hearing from you very regularly to ensure you're not forgotten. Pre-approval and special financing incentives via direct mail and email are good tactics to use. Perhaps a personal call from member services or the loan department can be made, too. 

     The vehicle's retail value is higher than the loan balance. Obviously these members can sell their vehicle outright, and use the money for a down payment on something new. The loan is vulnerable if the mood strikes. Increase your communication frequency to these members. Remind them about the benefits of pre-qualification, low rates, additional discounts, and any services that might steer them back to the credit union when they make a move. A refinancing offer to access the cash equity is something to consider, too.

     The member has no equity. Contact them a few times a year to illustrate their equity progress. Communicate sound financial practices and other credit union services to deepen the relationship with you.

Budgets are still very tight in America, and people save money by financing through a credit union. Help members avoid the costly mistake of choosing dealer or bank financing.  A strong retention program throughout the loan lifecycle reminds them their credit union is the best place to come for their vehicle (and all) financing needs. It strengthens your auto loan portfolio and other credit union products and services, too.

 

Pinpoint Direct Marketing creates data-driven, electronic and print marketing campaigns for the financial industry. Its customized campaigns achieve excellent results without premium costs. Learn more about Pinpoint Direct Marketing at www.PDMKT.com or call Kerry Blom, owner, 866-784-7555.