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Digital Relationship Building Key To Forming Customer Loyalty

Put into action what you already know about your members, and do it in ways that build value one small step at a time.

In November I attended the fourth annual Digital Marketing for Financial Services Summit (DMFS) in Brooklyn, NY. The conference focused on the power of digital transformation for financial institutions and their marketers. There were a few themes that were consistent throughout the two-day conference and I wanted to share them with you.

Keynote speaker, author, and financial industry visionary Brett King, told a group of financial institution CEOs and marketers that he believes the future of banking is creating memorable experiences for members and customers. Echoed throughout the conference was the need to create these tangible and intangible opportunities for people to have a reason to engage with their financial institution, especially as competition continues to grow.

Data-driven experiences were at the top of the list ― all stemming from having quality data that could run through complex algorithms to generate these experiences. Artificial intelligence (AI) and Big Data are the buzzwords these days; however, generating lots of good small data is the first logical step, according to Randi Schochet, CMO of Cross River Bank. So how as a financial institution can you bottle this high-level thinking into actionable items as we move into 2018? Here are a few ways to think about engaging with members moving into the future:

Member Experiences

Give your members a reason to engage with your services. You probably have that member who hasnt stepped foot in a branch in six months to a year. How can you keep this segment of customers coming back and using your online channels? Offer them services that offer support or help, and not just try to cross-sell them another product right out of the gate. As you know, its about building relationships and providing educational material to build or reinforce trust.

Some financial institutions have seen success by providing credit score counseling to build long-term relationships with their customers ― leading to account and loan growth. Other opportunities include providing members saving guides and calculators or simply informing them about tools you already have available on your website that they may not have known about.

The goal here is to be seen as a resource so your customers feel more inclined to use your services. Social scientists call this the Theory of Reciprocity. Its about having members respond positively based upon your institutions positive action (i.e., providing timely and relevant information).

Incremental Change

Several presenters at the DMFS communicated the complexities of working in the banking industry right now. And hearing from vendor after vendor that the sky is falling can be a morale breaker as you feel you cannot change fast enough. The key to not feeling overwhelmed is to make a plan and make incremental changes. You dont have to throw a touchdown on your first play. Gain small yardage, which can quickly add up and get you in place to score that touchdown.

Thinking about how to stay relevant in a digital age? Maybe spending money to build out your own app is not the best investment given how adoption rate of bank-owned apps is relatively low with only 31% of consumers using their banks app, according to J.D. Power.

The conservative play with incremental change would be to adopt a loan payments platform that is responsive and can work with or without an app. By making small changes, you are giving your borrowers flexibility on how they pay their loans while demonstrating your ability to meet their demands by making loan pay accessible just about anywhere.

Using Member Data To Improve Lives

Being a financial institution means you are sitting on a treasure trove of information about your customers. If creating experiences is the differentiator to retain members long-term, then finding ways to utilize your data to improve their lives is creating data-driven experiences. So what does this really mean? Think about the kind of data you have collected; you have your members spending habits.

You can create or find ways to analyze this data to predict and serve up relevant information to your customers. If you see that theyre getting close to the end of their auto loan payment, start offering them a low-interest rate on a new loan or refinance to retain them as a borrower. One way to achieve this is to email or incorporate an alert when they log into their account about partner car dealerships or pre-approval notifications.

Maybe your system notices every time your member gets paid with a direct deposit. On those paydays, your institution could serve up a reminder about saving with an offer to create a new savings account with ease.

Give your members reasons to stay engaged with your credit union. Remember, that change doesnt mean swing for the fences at the first pitch. Make small changes so they add up to increase value for the borrower. Solving the problem of finding effective ways to use customer data will move your institution above the rest. Its about creating personalized experiences and serving up relevant information to your customers even before they realize they need it. This type of digital relationship building can help create long-term customers of your financial institution.

Stephen Chavez is a senior marketing programs developer for CUES Supplier member SWBC, San Antonio, Texas. He develops and implements marketing initiatives for SWBCs Financial Institutions Group. Learn how you can boost your auto lending portfolio and reach millions of new consumers with an online and mobile direct-lending platform by requesting a demo of SWBCs AUTOPAY.

This article is sponsored by a recognized solutions provider in the credit union industry. Callahan & Associates does not endorse vendors or the solutions they offer, and the views and opinions offered here might not reflect those of Callahan. If you are interested in contributing an article on CreditUnions.com, please contact the Callahan team at ads@creditunions.com or 1-800-446-7453.
December 4, 2017

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