Deploying Marketing Automation for the Credit Union

By Jeff Shood

All businesses feel the need for speed. But what good is that increased activity if your aim is off? Technology has long been sold on the promise of providing better, cheaper and faster production, but much is lost when all the company is doing is speeding up old, poorly designed human processes.

We see this occasionally when companies attempt to implement marketing automation platforms that were not designed with the modern Credit Union in mind. Fortunately, with the right marketing automation platform, credit unions absolutely can ensure best practices on the way to elevating performance.

Early marketing automation platforms made it easier to upload a spreadsheet filled with customer data into a list so that a marketer could use the technology to schedule a flight of marketing emails over time. However, this also exposed the financial institution to risk. When a new customer receives an automatically generated offer for a product or service that they have already purchased at a higher cost, the relationship will be damaged.

Modern marketing automation platforms have the ability to sync in real time with the company’s other platforms, sharing data and information about the customer that can be used to trigger marketing events. It also allows the credit union marketing department to segment their client and prospect lists in a very granular manner, which allows them to send out very specific offers to small sets of members. It can send email, direct mail, text messaging and offers some level of social media management. It can produce automated drip sequences as well as blast marketing. The return on these kinds of activities when applied to the right member at the right time is extremely high.

Marketing automation best practices for credit unions

Credit unions have to attract the attention of consumers to succeed just like any other business. But there are things these institutions can do with a good marketing automation system that other businesses cannot. CUs can fully capitalize on modern marketing platform power by following these best practices.

Provide loan status updates automatically

In study after study, consumers complain about the lack of information flowing back from their loan officers and real estate agents. Many leading originators train front line customer service staff and loan officers to be proactive in updating consumers, but this is time-intensive and costly. It is far better for the credit union to task its automated marketing platform with providing frequent status updates to borrowers automatically. This takes the load off of the staff and makes it crystal clear to the member that the credit union values them and respects their time.

Maintain a strong connection while the borrower shops

Whether the credit union member is shopping for a new home or their next automobile, staying in touch with consumers as they shop for their purchase puts the loan originator in the perfect position to receive the financing business as soon as the member makes a decision. Today’s marketing automation platforms are more than capable of remaining in touch with your members as they shop for their next purchase. Setting up these systems to keep these leads warm is a best practice of the best credit unions. In fact, we have customers that have improved auto loan purchase closings by 44 percent just by implementing this practice.

Automate new member onboarding

Bringing a new member into the credit union is a very important task that far too many institutions take too lightly. The onboarding experience will set the tone for the engagement and has been correlated to the lifetime value of the relationship and the ultimate share-of-wallet the institution will achieve.

Some credit unions spend a lot of time and money recruiting, hiring, training and managing front line customer service staff to bring new members on board, but this presents many cost and management challenges. With a sufficiently powerful marketing automation platform, the credit union can provide all of the required information to the new member, ascertain their preferences and then create an experience for them that will get the new relationship off on the right foot.

Offer mortgage shopping advice

The federal government is working hard to convince borrowers that they should shop for their new loan, providing rate information through government websites. This is causing competition for new loans to heat up, but it can also be an advantage for the credit union that knows how to use its marketing automation platform.

By staying in touch with its members and offering them the kind of information they need while shopping for a new home, car or loan, the credit union can short-circuit the shopping process by becoming a participant in the member’s buying process. Then, when the borrower is ready to make the mortgage application, the credit union will be the obvious choice.

This is so important for the CU’s home finance business because the cost to originate is so very high. In 2018, it costs nearly $8,000 to originate a loan, $3,000 of which will be spent before the loan ever gets to application. Staying in touch with members and educating them about their options can double closing ratios and slash these costs.

Investing in the right kind of marketing automation platform

Setting up a system to employ trigger marketing, one of the most prized automation capabilities, requires a near real time integration with the other data platforms in use in the credit union. It also requires the creation of a customized data schema for use by the marketing automation platform so that triggers can be created and then marketing campaigns designed for use when those triggers are activated.

Overall, it can be fairly expensive to set up these systems such that they employ intelligent automation properly. However, once set up they will deliver all of the benefits professional marketers expect to receive from these systems and will do so with a significant reduction in staff time. Perhaps one of the greatest advantages is the analytical power built into these platforms, which tells management exactly what is working and what must be adjusted.

Generic Enterprise Platforms

Any business can benefit from automation of routine tasks, and therefore generic marketing automation platforms have proliferated to give marketing managers some relief from the work of responding to each new prospect with personal attention. The marketing contact can be personalized and delivered through a variety of channels. Some of the largest companies in the country are using these generic platforms, which provides revenue developers use to create tools that benefit companies of all sizes.

Many of these platforms have a wide range of functionality available out of the box and can then be customized with the addition of trigger marketing functionality. They often offer open APIs, allowing companies with IT capabilities to customize them even further.

The disadvantage to these generic systems is that they generally require more staff to set up and operate and have very long implementation timelines as each interface to the company’s other information systems must be crafted individually. This lack of pre-built synchronization is common among these generic systems, and because they are so customizable, they require the company to begin with a blank canvas. This often means hiring a consultant to get the most out of the system.

One of the more serious disadvantages for credit unions is that these platforms do not come with the capability to interface easily with typical credit union data schemas. For instance, a large generic platform may allow up to 1,000 custom data field, which sounds like enough until you realize that a typical credit union member may have three credit cards, two auto loans and three old loans that have been satisfied and an old mortgage. The generic platform will let too much data fall through and render trigger marketing far less effective.

Finance industry specific platforms

The second class of marketing automation platforms have been created with financial services in mind. They offer all of the core capabilities available in the generic platforms but with the addition of the financial services data model. This gives them the ability to replicate all of the mortgage, consumer lending and banking products the typical credit union will offer its members.

Having a better grasp of the real marketing requirements of the financial institution allows these platforms to offer true trigger marketing capabilities without the need for a large staff or long implementation timelines. This offers a much better cost to value ratio for credit unions.

Companies that manage to balance big business volumes with the smallest details that matter so much to the individual customer are the ones that go on to great success. Professional marketers need to know when to make an offer, and that’s where today’s marketing automation combined with credit union member data becomes a very attractive combination. With the right platform and strong commitment to best practices, advanced marketing automation technology allows credit unions to master the macro and micro, over- and insight, while rooting the devil from the details and achieving that critical pinpoint timing with the customer.

We wrote about this in more detail in a new White Paper that’s available now on our website.

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