The Branch: How loyalty programs can make banking brighter
For some cardholders, stopping by their credit union branch is a necessary burden, akin to scheduling a doctor’s appointment. Any deviation from perfect financial health can cause anxiety and credit unions are taking small steps to make branches more welcoming, offering hot beverages and modern decor. However nice the tangible perks are, they are only a portion of the goal: an end-to-end positive experience.
How can credit unions provide that experience? Leveraging a rewards program can be the next great step in increasing profitable behaviors and improving the in-branch experience. A rewards program can be used to create positive touchpoints, increase financial literacy and give members access to more banking perks.
Creating positive touchpoints
A visit to a local branch should be an opportunity to create several positive touchpoints. These touchpoints should be member-centric to deliver the best experience possible.
Credit unions can identify common issues that members are likely to need help with. For instance, 40 percent of Americans don’t have enough savings to cover a $400 emergency expense. [1] Having a branch member service representative provide information about savings products or offer to set a direct deposit to an existing savings account would create a positive touchpoint for a member who doesn’t have an emergency fund.
Positive touchpoints don’t have to be limited to the interactions that happen inside of a branch, as discovered by the call center team at Park City Credit Union of Merrill, WI.
How Park City Credit Union created positive touchpoints
Park City Credit Union had six team members call cardholders over the course of two weeks. The purpose of the calls was to reach out to members, remind them about the Buzz Points program and deliver information on how these points could be redeemed. The calls also functioned to verify contact information to improve security.
”Park City Credit Unions’ call center enjoyed reaching out to cardholders to inform them they had points to redeem and educating them about the Buzz Points program,” said Nicole Johnson, VP of Marketing and Innovation during the campaign. The outreach effort resulted in members redeeming for nearly $3,000 worth of rewards spent at community businesses.
The benefits of this outreach effort included boosting local business, re-engaging members and reminding them of the Buzz Points program. Members loved hearing how their everyday spending earned them credit at their favorite area businesses – feeding into better financial literacy.
Increasing financial literacy
Did you know that only five states require high school students to complete a financial literacy course to graduate? It is estimated that 76 percent of millennials don’t have basic financial knowledge. [2] This creates is a perfect opportunity for credit unions to offer beneficial financial literacy programs.
Credit unions can fill the financial literacy gap by using their own data to deliver the most relevant financial literacy programs for each member. A member who doesn’t use a certain financial product could receive educational material about this product and its benefits, creating empowered (and profitable!) members.
Financial literacy programs can even be connected to rewards programs. Member can earn points for attending events, completing quizzes and applying what they have learned. Some financial institutions reward members for handling their finances responsibly, for instance, when they make loan payments on time, maintain a minimum account balance or transfer money to a savings account.
Educational touchpoints can be created when a member visits a branch, but there are many other channels that can be used to deliver this type of content. A financial literacy app could be a great way to keep members engaged and gamify financial literacy.
Redeeming points for banking perks
Being able to redeem points for banking perks creates an instant positive experience. Credit unions can reap the benefits as points are used to improve a member’s experience, develop loyalty and provide value.
Instead of redeeming points for gift cards, members will appreciate being able to use their points for banking perks. These rewards can easily be worked into the service rep talk tracks that happen during a visit to a local branch.
A member service rep could check the member’s point balance and recommend the most relevant banking perk. Some institutions let members redeem points to skip or delay a loan payment, lower the interest rate on a loan, waive fees or get a higher yield on a certificate of deposit.
Redeeming points for promotional items with the credit union logo on them is another great way to connect with members and foster loyalty. A rewards program can become a valuable tool for improving the in-branch experience. Credit unions can make the most of their rewards program by connecting it to in-branch interactions by having member service reps inform members on how to redeem points for gift cards or banking perks, about products that a member doesn’t use or about financial literacy. These touchpoints needn’t be limited to in-branch interactions, Park City Credit Union proved positive interactions can happen over the phone as well.
Article Sources:
[1] https://money.cnn.com/2018/05/22/pf/emergency-expenses-household-finances/index.html
[2] http://www.businessinsider.com/most-us-high-school-students-never-have-to-take-a-finance-class-2017-10
