After its 2011 merger with Addison Avenue Credit Union, First Tech Federal Credit Union’s ($7.7B, Mountain View, CA) Net Promoter Score soon began to drop. The credit union’s chief retail and marketing officer, Stephen Owen, was puzzled. When he dug into the data, Owen discovered the credit union’s contact strategies post-merger had not kept pace with its rapid membership growth.
“In the branches, only about 3% of new members were being contacted by us for follow-up in the first 30 days after establishing their membership,” said Owen during a speech at the 2015 Member Loyalty Live Conference in Phoenix, AZ.
Those members the credit union was missing included a large swath of high-tech members who visited branches less often than previously. So starting in late 2014, First Tech’s 12-person marketing team launched a series of largely digital campaigns.
4 Ways To Say “Hello”
CU QUICK FACTS
First Tech Federal Credit Union
data as of 3.31.15
HQ: Mountain View, CA
12-MO SHARE GROWTH: 10.1%
12-MO LOAN GROWTH: 20.5%
CORE PROCESSOR: Fiserv DNA
MCIF/CRM: Eloqua Marketing Automation and Salesforce
ONLINE BANKING: In-House
MOBILE BANKING: In-House
BILL PAY: Fiserv - CheckFree
First, First Tech delivers customized member savings reports via mail, email, and phone call. These statements compared the value of the products and services for every single member against what they would cost in both rates and fees at other banks across four major markets: the Bay Area, Portland/Beaverton, Seattle, and Colorado.
“We don’t view other cooperatives as our competition, so this was solely bank focused,” Owen told conference attendees. “We covered 14 to 20 institutions across four major markets using published website rates.”
Last year’s reports revealed members were saving an average of $532 each —or $3,000 per year if the member had six or more products— and the entire membership saved a total of $143 million.
Second, the credit union welcomes new members through an experimental 30-day email onboarding program. On Day One, First Tech offers a simple greeting “Welcome!”; Day Three focuses on security; Day Seven is all about where they exist socially; Day 15 is oriented toward online banking, mobile, and deposit; Day 21 introduces checking; and Day 28 covers other products and services. If a member has already signed on for a product or service, the onboarding program automatically skips that. This concept is known as a triggered approach, since messages are sent, or not sent, automatically based on member behavior.
Third, First Tech uses a membership path to track engagement and refine messaging for user groups. According to Owen, the first tier in the path is membership attainment. The second tier encourages members to move their checking account to First Tech. The third tier focuses on making the credit union the primary financial institution for the member, which includes checking with direct deposit, while the fourth focuses on consumer loan, credit card, or 401(k). The fifth, and final, tier focuses on an investment relationship, mortgage, or deposits of $25,000 or more. Owen says as of first quarter 2015, the percentage of members in each step was approximately 29.4%, 25.9%, 24.3%, 11.4%, and 8.9% respectively.
Finally, First Tech automates 1:1 email blasts based on member behaviors, as well as and institutional need.
“If we know a member has a mobile device but they still do a lot of in-branch deposits, we can now send communications to let them know there are better options,” Owen said during his presentation.
To date, the onboarding pilot alone has helped the credit union increase its Net Promoter Score by 11%, according to Owen. On the next page, Owen talks about First Tech’s efforts to provide intelligent, targeted, digital messaging in an online-first world.
What does First Tech’s marketing budget look like today compared to in the past?
Stephen Owen: Our budget has grown significantly YOY. Last year was a fairly quiet year, and we are ramping up our spend this year. This includes targeted, multi-channel advertising via digital media and, where appropriate, social networks to better engage both new and existing members in a more personalized manner.
Stephen Owen, Chief Retail and Marketing Officer, First Tech Federal Credit Union.
What’s driving this shift toward automation and personalization?
SO: Rather than a one-size-fits-a-group mentality, we want to personalize and nurture each member’s experience by providing relevant information based on their needs, either on our digital properties or through targeted or triggered emails.
This approach has the power to create anongoing relationship where the member is always informed about relevant content, products, and services, delivered in a way that is more customized to their interests.
For example, in our Saving Report letters and emails, we didn’t just provide the dollar amount a member has already saved. We also provided them with other logical product suggestions and the potential savings they could receive. Something like “you could save another $1,000 by switching your mortgage to First Tech.”
How did First Tech refine its email strategy?
SO: Within our Eloqua Marketing Automation system, which we began using in late 2014, we started by doing IP warming, sending fewer but more valuable emails to establish ourselves as a trusted sender among different Internet Service Providers. This helped ensure we are delivered to our members’ inboxes, and not their SPAM folders.
Today, the credit union scores 99 out of 100 in this regard and our email open rate and click-through rate both increased more than 30% year-over-year compared to early 2014. What’s more, only .01%, of the members,who received these emails unsubscribed. That’s a very low number by industry standards, so the content and timing are clearly relevant.
We are still early in our journey with regard to A/B testing, but we have done some basic subject line testing to small samples and then pushed the winning version out to the majority. Over time, with a robust subscription center, we’ll also allow individual members to set their own preferences and tell us how they want us to communicate with them.
What data sources does this this 1:1 communication style require?
SO: Eloqua is integrated to Salesforce, our member CRM system, which in turn utilizes data from our core banking system, Fiserv DNA. We also integrated other operational systems and demographic data, some manually, some partially automated. We still have more to do in that area. We have also implemented Eloqua tagging across our public Web properties so we can see our members’ digital body language from within Eloqua. This behavioral data is then brought in and combined with personally identifiable information (PII) to do better triggered communications.
Much of the data already exists, so our efforts are on making it more usable and reportable through data visualization tools.
We are in the midst of knitting everything together to make this seamless, including building a data warehouse to store data offline. Much of the data already exists, so our efforts are on making it more usable and reportable through data visualization tools.
How have your efforts to engage new members through onboarding emails paid off?
SO: When we first started this experiment, the open rate and click through for these new onboarding emails were four to seven times better than we’d ever seen. Of course, the end goal for us is to use this methodology for 100% of our new members, and we’re ramping things up over the course of the year.
In the first quarter of this year, we had approximately 40% of our new members go through the pilot program with the rest serving as a control group. The average Net Promoter Score for those who were not a part of our email-nurturing plan was 65 and the average for those who were was 72. This is a statistically significant improvement.
Will mobile notifications also be an important piece of these communication strategies?
SO: Our eDeposits surpassed ATM deposits last August and continue to accelerate daily. As things pick up in mobile, I think this creates more opportunity, not less, to engage our members.
We have responsive templates so members and prospects can view both emails and landing pages easily on any sized screen or device, and in the future we will also do geo-fencing to better target our SEG sites and branches.
With a member’s permission, we can begin to push them relevant content via their device about how something might help them save time or money. Mobile is a great medium, and its use as a primary banking interface is continually increasing. We have proven that if a message is compelling and timely, it will get our members’ attention.