Lending Purse Strings Loosen

By John Blom and Margie Church

It's been all over the news that subprime lending for auto loans is on the rise. If you haven't created any marketing campaigns to members with credit scores below 680, you might be getting the itch.

Here's the kicker. Many of these people have been sitting on the fence about replacing their vehicles and now, they may be hesitant to come forward because their financial situation hasn't been great.  You can diffuse that fear by acknowledging that the member's credit may have taken some dings, and telling them your lending department makes decisions on a case-by-case basis. If they have concerns or other needs, this is the right time to get in touch with you.

The obvious approach in this auto loan campaign is a pre-qualified or pre-approved offer. Don't make the member guess. They want solutions, not gimmicks. Use variable data to provide a rate and payment example based on their individual score. Marry the direct mail with a PURL. If things look good or they want to talk, the PURL lets them respond immediately. Follow up with an email or another direct mail piece. Spread the news on your website and to branch visitors with supporting ads and materials.

The automotive market is having a banner year. A carefully-crafted promotion to your members could be a great boost to your local economy.

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.

Seven Ways to Change Your 2012 Business Landscape

By John Blom and Margie Church

At this time last year, many CUs were idled back, waiting for the New Year to reveal which direction to take. Many CUs wouldn't put a stake in the ground and chart their own course. They had their budgets and ideas under lock and key. In a down economy, we can understand a conservative approach, but doing nothing puts a business in perpetual reactionary mode.

If your credit union is still navigating without a rudder, we offer seven suggestions to get you moving in a forward direction right now.

1.  Do a post-mortem on 2011. Take out the white board and write down successes and failures. In simple terms, try to understand what made each item your list fall where it did. Then, try to figure out which are worth pursuing further/again in 2012.

2.  If you haven't already, create a new member program to deepen your relationship with these people. Many of them may have joined because of the November Bank Transfer Day. They could already be disillusioned if they haven't been hearing from you. Correct this now by convincing them that your friendly staff and comprehensive services are perfect for all their financial needs. Time is running short. The first six months of membership are crucial.

3.  What's your new idea for 2012? According to Callahan & Associates, credit unions that increased their marketing budgets in the second quarter of 2011 noted substantial increases in member growth and balance sheets. U.S. credit union marketing expenses increased 3.8% to reach $483 million. This was the fifth straight quarter of annual increases. Profitability will remain a key issue for CUs in 2012. Take a look at your promotions calendar and compare it to your membership profile. What can you do to make promotions fresh and more effective?

4.  Reposition specific products and services to answer a need. Are you trying to reach people aged 22 to 35? Did you know:

• Sixty-five percent access their account information through the Internet, while 28% use a mobile application from their bank or credit union. 
• Six percent use mobile devices to remotely deposit checks. Among those using the service, 54% use it at least once a month; 39% use it weekly. 
• Sixty-four percent said that tracking account balances is the most important feature they currently use while banking online, followed by paying bills (34%), and transferring funds (28%). 
• Seventy percent wish they could see their entire financial picture, and manage all of their finances in one place, regardless of the information source. 

5.  Stop talking about Gen Y and Gen X and start talking with them. They are highly connected with social media and the Internet. Be yourself. Be authentic. Give them reasons to engage with you by providing information they can use and easy ways for them to respond.

6.  Get to know your members better this year. Do something proactive to keep them, and foster younger members into becoming your most profitable members. Invite them to quarterly events, put polls on your Facebook page, or make a commitment to collect and use membership data.

7.  Identify one bad habit you're going to kick this year. Maybe it's overcoming a resistance to using email marketing. Maybe you'll start asking your member services staff for input at the front end of a campaign so more leads are converted to sales. Perhaps you'll study the performance reports from your campaigns, and finally be able to justify the expense (or not) because you know what is working and what is not. Maybe you'll stop being reactive or passive and get out in the marketplace acting and sounding like the winner you are.

The economy is improving, and interest in credit unions has never been higher. Make the best of your marketing landscape. We'd love to hear how you plan to meet 2012 head on.

Pinpoint Direct Marketing exclusively serves the U.S. credit union market. We provide excellent, turnkey or a' la carte creative services at a great value. Click to learn more.

How to create impulse buyers

by Margie Church

With the growing emphasis on electronic marketing tools, we pay particular attention to our clients' success rates when they use emails and PURLs in their direct mail campaigns. Can a credit union get members to act like impulse buyers? We think so.

Here are three typical examples of how our clients proved our theory.

1.  We learned that a PURL, email, and letter is the perfect combination for skip-a-pay campaigns. Our clients typically see an average of 10% PURL visits and over 80% conversions. In other words, hot leads. "I want your offer, and I want it now." 

2. Using emails to promote auto loans and credit cards also proved successful. We see an average read rate of 20% on these campaigns. Including a PURL gave an additional 1% lift rate.

3. We have clients that use a PURL with their new member mailings. The PURL reduces the "I'll think about it" behavior. The recipient can directly and conveniently sign up for new services or products when they receive their monthly letter. If your credit union needs to improve the number of products-per-member ratio, adding a PURL has delivered an average 1.5% response rate.

What's the typical cost per hot lead?

Let's say you sent 2,000 emails with a PURL. At our place, an email costs a mere five cents per address and so does the PURL. Your expense is $200 for this portion of the campaign. Our average response rate on any campaign is 2% on PURLS, giving you 40 visits. The average conversion rate (PURL submissions) is 70% or 28 hot leads, costing you $7.14 each. Seems like the expense is justified, don't you think?  

Emails and PURLs take dead aim at fast delivery and responses. Sure there'll always be people who prefer to come in or call, and there's nothing wrong with that. But using email and PURLs help ensure you strike while the iron is hot, and don't leave business on the table.

Pinpoint Direct Marketing exclusively serves the U.S. credit union market. We provide excellent, turnkey or a' la carte creative services at a great value. Click to learn more.

Where do you go from here, Credit Unions?

By Margie Church

Unless you've been stranded on a desert island without connectivity to America for the past six weeks, you know all about November 5. A grassroots movement that credit unions were slow to embrace, Bank Transfer Day took off without them, leaving some racing to ride the wave of free publicity it created. 

In case you missed these eye-opening results:

• Approximately 650,000 people have joined credit unions since September 29. This equates to more new members in October than in all of 2010.

• Credit unions realized approximately $4.5 billion in new deposits through October.

• 40,000 new memberships were opened on November 5, and

• Credit unions saw $80 million in new share accounts,¹ and

• Credit unions originated $90 million in new loans.¹

We may never discern what portion of this growth was motivated by Bank Transfer Day versus consumer anger about new fees and big bank arrogance. What matters is that Americans reacted, and credit unions were the big benefactors.

History has proven that Americans are fond of grassroots movements. And Bank of America likely smelled a grass fire when it cancelled its plans to institute the debit card user fee. But we all know big banks aren't going to go quietly into the sunset, licking their wounds, having finally learned not to mess with the Average Joe. They, and other banks, will find ways to increase existing fees and introduce new ways to get what they're always after – bigger profits for themselves.

Credit unions are sure to see an uptick in new business as long as this topic is kept in front of consumers. What can you do? Pick the low-lying fruit. Deepen your relationship with members by contacting them with another relevant and timely message now. 

Free checking is only one way credit unions save their members money every month. At this time of year, everyone seems to be cash-strapped. Boost your members' budgets by offering your lower-interest rate credit card. Tantalize them with savings examples when they transfer higher-rate balances. To those members who already have one of your credit cards, offer a great rate on a personal loan to help pay off holiday expenses or plan a winter get-away.

As we close out 2011, and look forward to next year, we have one piece of advice: full steam ahead.

1-      http://money.cnn.com/2011/11/08/pf/credit_union_switch/?source=cnn_bin

Pinpoint Direct Marketing exclusively serves the U.S. credit union market. We provide excellent, turnkey or a' la carte creative services at a great value. Click to learn more.