PEORIA, Ill.-A $7-million bonus dividend can go a long way toward retaining members, attests CEFCU, which plans to emphasize its year-end payout in promotions to potential and existing members.
"We make sure that people know about it," said COO Sandy Andrews, who noted that CEFCU has paid the bonus for several years. "It has been very successful in helping us keep members. We have a 94% retention rate."
CEFCU showed solid growth in membership last year - 9,300 members - and almost $400 million in new deposits, partly the result of the acquisition of the failed Valley CU in California, where it now operates VCU as a "division."
CEFCU believes investing in the bonus dividend will remain its most effective retention strategy, but its not a standalone. "The bonus dividend, while effective, alone is not enough to retain members," said Andrews. "You have to, of course, have low fees, great rates, and provide quality service."
The $4.2-billion CEFCU has also been adding incentives to urge members to bring over more services, handing out a $25 gift card for opening a new checking account, and reducing mortgage closing costs for first-time homebuyers.
Still, Andrews does not deny the bonus dividend drives home the credit union difference and keeps members on board. "Let's just say we didn't see any ads from banks promoting their bonus dividend."
