SAN DIEGO - A tough but loveable bulldog is helping USA Federal Credit Union take aim at “fat cat” bankers and grow membership, after its indirect lending program led to an attrition problem at the CU.
Spike, the $700-milion CU’s new “spokesdog,” has been the focal point of a two-month multimedia campaign that attracted 4,000 new members.
The campaign to bring in new members went right after bank competitors by asking consumers to “say ‘no’ to the fat cats,” and explained that CUs and banks are “as different as cats and dogs.”
“There is a lot of debate in the industry as to whether we should emphasize our differences,” said Rob Folsom, chief strategy officer for USA Federal. “But as we started developing this campaign we realized that the differences are what it’s all about. We want to separate ourselves from the way banks do things and how they think about their customers.”
The CU spent $350,000 on the campaign that included newspaper and radio advertising, direct mail, online marketing, and one-day sales events. Prize drawings drove consumers into branches, with scratch-and-win tickets for a Harley-Davidson motorcycle, HD TVs, iPODs, Nintendo Wii video games, and a $2,500 vacation. Individuals brought tickets they received in the mail to a branch and shared ticket numbers with member service reps to see if they’d won.
The promotion netted 1,348 new members. While attrition was a little higher than Folsom expected, the CU easily exceeded the campaign’s goal of 400 net new members.
Folsom acknowledged that retaining members has been a problem for the 60,000-member credit union, which had been seeing negative growth. Its heavy focus on indirect lending hurt retention, he said.
“We had been bleeding those (indirect loan) members because they really weren’t members. And there wasn’t a real compelling reason for people to come into our doors. Spike changed that,” Folsom said. The promotion portrayed the CU as being different than the average bank in terms of attitude and service and a better place to do business. Spike also appealed to younger members, Folsom said.
“The most exciting part of the campaign is that we wanted to reach a younger demographic and we did. The average age of our membership is 53. This campaign squarely hit Gen Xers. Not only did we hit our target, we got accounts for the long term–checking, credit cards, and we’re starting to see money markets,” Folsom said.
To retain the new members, USA Federal plans to use follow-up direct mail, phone calls, matrix mailing, permission-based e-mail, and its front-line staff. “We went to our branches and asked them what support they needed to retain new members and they said just get them in the door and we’ll cross sell services based on need,” Folsom said.
According to Folsom, Spike–who will continue to be part of the CU’s advertising – did a lot to differentiate USA Federal from banks, but he’s not the credit union’s brand. “We were looking for some way of connecting with people and Spike is the tool. He brings an attitude that we’re tough, bold, and going to give consumers what they are looking for from a financial–that’s our brand,” he said.
Seattle-based Weber Marketing Group developed the campaign. Brand Strategist Jeffry Pilcher says the agency believes financial advertising needs to stand out.
“The vast majority of financial advertising is ignorable,” Pilcher said. “You have to do something that is really different, something you’d almost never see paired with a financial institution to get noticed today. Couple that with a good promotion and you have a double whammy... After you create differentiation and get noticed, then people are receptive to other messages from you. Otherwise you are left to compete with nothing but rate.”
