By Frank Koechlein, February 25, 2019

For many smaller credit unions using their member data to create a meaningful segmentation scheme helps drive the transformation to selling people not products.

Managing the assets and liabilities of your credit union in order to maximize revenue has typically come down to matching the right lending and funding products.  Financially this makes sense, however,  this product focused thinking many times gets passed down to the marketing and member facing associates.

This means media campaigns and one-to-one interactions with members in the branches are framed in the context of products to be sold. Mismatches occur; like members who don’t own a home are told about the benefits of using a home equity loan to pay tuition or fund home improvements.  This scattershot approach to cross-selling your members can have a negative effect on their affinity for your institution.     

If you are using member data to drive segmented marketing campaigns it only makes sense that your branch associates should be looking at members in the same segmented manner.

Lets take a look at the results of one smaller community focused financial institution that implemented a needs based selling program for its member facing associates. The program looked at seven life stage segments.  They then developed a financial profile for each segment with life events, financial concerns and possible solutions to be offered by the credit union.

This was not a high tech operation; segment brochures were developed and they eventually became much more popular than the current product specific brochures. Several monthly sales meetings were dedicated to understanding the segments and role playing on how to approach needs based cross-selling.

This backdrop will help to explain the results of our recent checking account cross-sell mailing targeting a select group of members. The pie chart below shows the distribution of account types that were opened as a result of this campaign.

The goal established for checking accounts to be opened was reached, however, it represented only 42% of the total accounts attributed to the campaign.

The transformation to needs based selling was amazing…when members responded to the campaign, branch associates approached them in a holistic manner as people/members not just as potential checking account to be opened. We are now tracking accounts/member and expect it to increase significantly.