HAMPDEN, Maine — While credit unions have long partnered with regional retailers to promote cross-industry marketing campaigns, Maine Savings Federal Credit Union is among a handful of CUs that offer a white-label, location-aware app to members.
"You see discount or loyalty programs a lot, but it's like a laundry list of discounts that you have to plan your day around," said Maine Savings Federal Credit Union's Vice President of Marketing Kirk Duke. "The technology behind a location-aware app gives you an alert when you are driving or walking past a participating retailer."
With more than 27,000 members and $296.4 million in assets, Duke explained that while the credit union wanted to engage all members, it specifically targeted its roughly 4,500 unique active monthly mobile users.
A traditional typical rewards program, however, was not the goal.
The CU instead looked to the Ann Arbor, Mich.-based Larky, which offers a location-based discounts service via client-branded mobile and web platforms.
Larky, which primarily serves the financial services industry, has 19 CU clients.
"We have credit unions of all asset classes—a couple hundred million to over $2 billion—as clients," said Larky's Vice President of Client Services John Nechiporchik."
Going Live
While the stand-alone app, Compass Club, went live on Dec. 14, 2015, Maine Savings FCU first underwent a beta testing process. This included engaging internal teams that demoed the app. One team was a cross-functional implementation team that represented the member service center, the technology department and branch representatives.
"We also made sure we had active employees internally that could answer member questions at the branch level," said Duke of the CU's 10 locations. "We then moved about the community and tested out the locations. Once it was seemingly operating efficiently, we submitted the apps to Android and iOS stores."
Among beta testers was Duke who experienced app alerts and received discounts—mainly 10% off deals at participating retailers and restaurants. He did concede that members have to alert merchants about the discount, which is done by either showing a Maine Savings FCU debit or credit card or the app. The discount is only awarded when using a branded credit or debit card, which in turn increases interchange revenues.
"We don't need to have our data talking to Larky's data. It removes an IT headache," said Duke. "We just need the merchant and/or the member to remember that a Maine Saving FCU card is required. We know that is not always going to happen."
From discovery to roll out, Nechiporchik said the process generally takes 45 to 60 days. Larky works with CU clients on the white label app so it is uniquely branded. Additionally, once a CU submits a preferred retailer list, Larky's team does the groundwork selling the concept to those merchants.
"One part of our service is reaching out to small businesses in the communities where our client's members live, work and play. We also develop the iOS and Android apps and then submit them to Apple and Google and getting them approved," said Nechiporchik. "Then the credit union is off and running."
Location, Location, Location
Available on Apple or Android devices, Maine Savings FCU members can now download the free app at the respective app store. Members create a profile with an email address and password. The next step is seeking discounts, which come in the form of a "text-like" alert.
Duke explained that the advertising of the app, which is tied to nearly 50 retailers, has primary been word-of-mouth and via Facebook campaigns. And with regard to adoption rates among mobile users, which stood at over 100 at year-end, he is optimistic.
"We hope to have 300 members signed up by the end of the first quarter [2016], then hopefully 750 by mid-year as we build momentum," said Duke. "By year's-end we expect between 1,000 and 1,500 users."
This early data reporting is in line with Larky's other CU clients who have realized a 35% to 38% member/mobile adoption rate after one year, according to Nechiporchik.
