David Klavitter, Chief Marketing Officer, Dupaco Community Credit Union
Members at Dupaco Community Credit Union ($1.7B, Dubuque, IA) have access tocompetitive rates, low fees, and free financial education and services. But Dupaco membership also includes complimentary offers and incentives such as free insurance policies, loan discount programs, and credit score tools that protect members’financial well-being and bolster their bottom line.
The credit union pays the insurance premiums on a $1,500 accidental death and dismemberment policy,rewards loyal members with better loan rates and discounts, and offers practical, effective ways to view, monitor, understand, and improve credit scores. It’s all part of a day’s work at the Hawkeye State credit union.
Here, David Klavitter, Dupaco’s chief marketing officer, talks about the credit union’s Thank Use program, a perk that gives members cold hard cash for using the credit union’s services. Since 2016, Dupaco has distributed more than 6 million Thank Use dollars.
CU QUICK FACTS
Dupaco Community Credit Union
Data as of 06.30.18
HQ: Dubuque, IA
12-MO SHARE GROWTH: 4.9%
12-MO LOAN GROWTH: 12.7%
How does the credit union determine how it returns value to members?
David Klavitter: Our credit union has annual goals for staff, so Thank Use is much like a goal for members. It’s focused on how member participation can actively help the credit union achieve its goals, which is the essence of members cooperating to improve themselves and the credit union.
The board determines Dupaco’s goals for the following year. These typically involve savings and loan growth, active checking penetration, electronic usage, debit and credit card usage, and member improvement, for example. Using historical data, we project what member engagement to target.
How do you calculate how much to return and to whom?
DK: It’s a mix of projected ROA, projected member growth, and member participation in targeted activities.
What is the advantage of returning value this way?
DK: In developing Thank Use, Dupaco wanted to make stronger emotional connections with our members to drive engagement and create a solution that underscored our cooperative difference. There are plenty of players innovating around consumer finance, so we leveraged our strength as a cooperative.
We’ve learned a few things along the way. The more engaged a member is with the credit union, the more beneficial the relationship is for the member in terms of satisfaction and for the institution in terms of profitability. What engages a member varies by individual, but the basic components of engagement are emotion, attitude, and feeling that the member has about the credit union. And finally, emotional bonds are hard to break. The more emotionally connected members are, the less likely they are to leave and the more likely they are to do more business and refer others to the credit union.
What communication channels do you use to announce and communicate the value of what Dupaco returns to members?
DK: It’s an ongoing campaign throughout the year. Members view their Thank Use participation dashboards when they log into online banking. It’s a real-time scorecard where members can track their participation progress.
It’s been three years, and staff and members are really starting to understand Thank Use and how it works. Our employees use Thank Use to open conversations with members about how members can earn the most Thank Use.
The campaign ends on Sept. 30 every year, and we pay out Thank Use dividends on International Credit Union Day. This ownership dividend illustrates Dupaco’s unique credit union purpose and structure. It’s a full-court traditional and social media press. This includes live radio interviews, billboard, radio, TV, and digital advertising; member engagement in social media; balloons and cookies in the branches. Every participating member receives a mailed letter that outlines how she or he has earned her or his Thank Use giveback.
How do you return the money? How much did you return in your latest round?
DK: We deposit the amount into the members’ savings accounts.
Active participation: Nearly 50% of members.
Total Thank Use giveback: $3.17 million.
Average member giveback: $65.04.
Maximum member giveback: $273.80
Minimum member giveback: $0.04 (one card swipe).
Achieved group goal of total debit and credit card swipes (top of wallet)
Members of Dupaco Community Credit Union show off how they will spend their Thank Use cash.
This interview has been edited and condensed.
Whether and when a credit union offers a patronage dividend varies across organizations. As does how they calculate the return and communicate the occasion. Read more QAs from CreditUnions.com’s ICU Day special feature.