Mobile Tips From Mid-Sized Credit Unions

Four lessons about how to launch and market mobile apps to the next generation.

Build it and they will come. But it better work when they get there, say marketers and technologists at several credit unions that are migrating members, particularly younger members, to mobile apps.

Best practices for launching and growing the mobile channel begin with finding the right technology provider and building a strong internal project team. That’s followed by extensive testing, soft launches, and marketing through multiple channels social media, website, and phone messages, to name a few to underscore the credit union’s complete service suite.

But foremost, get it right.

‘You don’t want to deploy something that makes you look forgive me stupid, says Jose Ramos, chief technology officer at Railroad Industrial Federal Credit Union ($182.1M, Tampa, FL). You only get one chance to make a good first impression.

CU QUICK FACTS

railroad industrial Federal Credit Union
data as of 06.30.14

  • HQ: Tampa, FL
  • ASSETS: $279.1M
  • MEMBERS: 28,271
  • BRANCHES: 8
  • 12-MO SHARE GROWTH: -0.19%
  • 12-MO LOAN GROWTH: -3.79%
  • ROA: 0.89%

And this isn’t just talk from the Florida credit union. RIFCU had a mobile banking website and could have deployed a plain app but waited until it had remote deposit capture functionality from its core technology provider, CMC/FLEX, and mobile bill pay integration from PSCU.

When RIFCU launched its app in September 2013, it had a simple-to-use, attractive product that covers the bases and keeps RIFCU members which includes a large number of very mobile CSX workers and their families out of the branches, Ramos says. He also stresses simplicity. For example, features such as single sign-on bypass the need to go through a separate app for RDC. Seamless functionality, he says, separates RIFCU from a large local credit union competitor.

RIFCU began marketing its mobile app in December, and so far this year, 6,456 unique mobile banking users have signed on that’s nearly 25% of its total membership of 29,515. Members have used the app more than 1.4 million times, including for 2,392 check deposits and 1,707 branch/ATM lookups.

I can guarantee you that most of the new users are young people in their 20s and 30s and even into their 40s, Ramos says.

Members Go Looking

People want the product and they will seek it out, says Jay Lassiter, vice president of marketing at Vons Credit Union ($425.1M, El Monte, CA), a SEG-based institution whose membership includes everyone from baggers to senior executives, including many young people starting their working lives at the grocery chain.

CU QUICK FACTS

vons Credit Union
<data as of 06.30.14

  • HQ: El Monte, CA
  • ASSETS: $425.1M
  • MEMBERS: 40,737
  • BRANCHES: 7
  • 12-MO SHARE GROWTH: 3.80%
  • 12-MO LOAN GROWTH: 15.32%
  • ROA: 1.10%

The mobile app it launched in July 2013 was the credit union’s first foray into mobile banking, and it supported the launch with three months of fairly heavy advertising that didn’t focus on any particular age group, Lassiter says.

We just encourage you to become a new member and then work to make sure everyone understands all our products and services and that they can get anything from us that they can from a big bank, Lassiter says.

Approximately 300 people are downloading the app every month, and 27.7% of the credit union’s 40,737 members are using it so far. Lassiter says a major factor in mobile banking success is the relationship with the app developer, Malauzai.

We’re a mid-sized credit union and not large enough to do our own development, Lassiter says. We’re seeing good organic growth, so we know our app is working well.

Negotiating Points

A good relationship begins with a good contract.

It’s important to work the contract really well, says Richard Logan, senior vice president and chief information officer at Credit Union of America ($576.3M, Wichita, KS), which launched its first mobile app in September 2013.

CU QUICK FACTS

Credit Union OF AMERICA
data as of 06.30.14

  • HQ: Wichita, KS
  • ASSETS: $576.3M
  • MEMBERS: 53,296
  • BRANCHES: 12
  • 12-MO SHARE GROWTH: 8.31%
  • 12-MO LOAN GROWTH: 16.17%
  • ROA: 1.18%

You need to think about where your growth is going to be and per-transaction costs, Logan advises. We were able to negotiate a good per-user cost and a good RDC price, which is where we’re seeing huge growth.

CUA has been notching month-to-month growth of 4% to 11% in its mobile banking signups now totaling approximately 9,000 among its 53,296 members and recorded 4,373 deposits from the 114 approved users of its SnapCheck service in August, a 12% jump in RDC users from the month before. And even though the number of SMS users declined by 6% to 194 in August, they still sent 3,642 texts to their credit union.

CUA rolled out its new app as part of a two-pronged promotion that also included a new electronic-only checking account. To encourage RDC use, the credit union gives a $2 check cashable only through RDC to anyone who comes into a branch.

Our staff then helps install the app on the member’s phone and shows them how to use SnapCheck, Logan says. It’s been effective for us and the staff is responding to it.

Needs? What Needs?

While working to give members all they want on their mobile app, CUA is conscious of not giving them what they don’t want. That means making all e-statements available on the app but not features that have generated little interest such as screen customization options and even personal financial management tools on CUA’s online banking website.

Everyone touts PFM as a hot sales button, but the actual number of people using it is low, Logan says.

Like Vons, Logan says his credit union is not targeting its marketing to a specific age group.

I generally think everyone wants to feel like they’re techie and hip and up on things, and they all respond to that type of marketing, the CUA executive says.

Social Media For The Ages

SunWest Federal Credit Union ($281.2M, Phoenix, AZ) also has strong adoption across demographics for its new mobile presence. The 44,350-member institution has offered mobile banking since 2005 but went live in June with the Fiserv Mobiliti app as part of an electronic banking platform conversion.

CU QUICK FACTS

sunwest federal Credit Union
data as of 06.30.14

  • HQ: Phoenix, AZ
  • ASSETS: $281.2M
  • MEMBERS: 44,350
  • BRANCHES: 7
  • 12-MO SHARE GROWTH: 2.91%
  • 12-MO LOAN GROWTH: 12.31%
  • ROA: 0.31%

It used a Facebook page that promotes the credit union’s community service blog for its initial marketing beginning in January by asking the 250 or so fans of the page what new services they would like to see from their credit union.

We got the feeling an app would be the most requested feature, says Jeff Morrow, SunWest’s marketing director. And we felt promoting it using new Facebook features was the safest way to go at first.

Now, 22% of the membership across all age groups uses the app weekly, Morrow says. The 25-to-34 age group is the most active, followed closely by the 35-44 group. Third is 45-54 and fourth is the 18-24 group.

Adoption among members age 55 and older is low, Morrow says, but SunWest also has found the youngest group, those millennials ages 18 to 24, to be a polarized crowd.

Either they’re going to be very active in mobile banking or they’re not even going to try it, he says.

October 27, 2014

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