TUKWILLA, Wash.-Many credit unions have seen an increase in new members and loans as a result of Bank Transfer Day. And then there's BECU here.
Consumer loan apps were up 74.8% in November, and the $9.5-billion CU believes the pipeline could be even bigger following months in which new membership sign-ups about doubled. In October BECU added 16,000 new members, in November another 13,000, and new member apps during December were up 170% over one year earlier.
Toby Travis, senior marketing strategist, said BECU is not tracking what type of new business the former bank customers are bringing to the credit union, but noted the loan spike is a sure sign that how the credit union is approaching new members is turning many into profitable accounts.
Deepening Relationship With Transferees
"Every credit union knows the importance of deepening relationships post-Bank Transfer Day," Travis said. "We don't want just a bunch of low-balance, high transaction checking accounts."
What is most interesting about BECU's ability to turn some of these former bank customers into borrowers is that what it is doing today is no different than what it has been doing over the last several years. Four years ago the credit union began to change its image in an effort to be seen as the "number-one trusted financial institution" in the region. Soon afterward it trained its front-line team to develop the skills needed to be consultative sellers, and then followed with a new marketing and onboarding process that relies on efficient electronic communications.
"I have to admit, what we are doing is right for the times," said Travis, who acknowledged that a number of fee and pricing decisions by major banks have alienated their customer base and dropped profitable members into the CU's lap thanks to BECU's business approach.
BECU's consultative sales strategy and follow-up marketing take a back seat to what Travis said is the most important and timely move the credit union has made in recent years. "I'd say we had about the perfect marriage of the moment (Bank Transfer Day) meeting our message. We had done such a good job of instilling within our communities that we are the number-one most preferred financial institution in western Washington. We wanted to be top-of-mind so when people think about switching, they think about BECU first-and they have."
Even in BECU's product-specific messages, noted Travis, it doesn't forget the bigger objective. "Even when our advertising is product focused we make sure the message, through the tone and what we were saying, is very different than what you'd see from a bank," said Travis, who added that the credit union understands that rate and product advertising do little to impact long-term consumer perception of BECU or any credit union.
One of the challenges for any credit union dealing with a rush of new memberships, acknowledged Travis, is explaining what a credit union is. He noted that has been a key message throughout the credit union's advertising over the last four years, has made bank customers more receptive to coming to BECU, and is a message included during onboarding at the front line.
"Our brand and the credit union brand is very strong here," said Travis. "We have done a comprehensive job in the last four to five years promoting the fact we are a credit union, are member-owned, not for profit, and put our members' interests first."
That position is reinforced by ensuring member service remains extremely high, explained Travis, adding that the credit union consistently monitors its Net Promoter Score. "It has been steadily climbing the last four years."
Member Consultants
That service starts when members are greeted by member consultants, which is what tellers became when BECU, founded to serve Boeing employees, adopted a new front-line sales strategy in 2008. The approach uses an in-depth consultative sales process that is not "pushy," but is focused on closing multiple account relationships during the sign-up process. "Our member consultants became better at understanding our members' problems and issues so we could do a better job getting people to bring more accounts over."
During the last 12 months BECU has improved its inbound marketing capabilities to tailor product messages to meet members' needs, which has improved cross-sales. "When members log into online banking we can make an offer that is relevant based on their interactions with the credit union and criteria we have established," said Travis.
Travis explained the change was made not only to provide members with an offer they can relate to, but to also lower the cost per message and increase the message delivery speed.
"For example, a member who is a good candidate for a Visa logs into online banking. They click on the ad and an app appears, they fill it out, and then click 'OK' to the disclosure and it's done. You go from a direct mail effort that costs you $2 to $4 apiece to pennies, and you give members something they can act on quickly and easily."
BECU uses the same approach for its onboarding efforts, for example, giving members reminders to activate their debit card. "We don't get pushy with our onboarding, or any advertising," said Travis, explaining that new members may not see a cross-sale for 45 days after they enroll. "A lot of what we explain early in the onboarding, after members sign up with the front-line staff, is emphasizing how to use the credit union, such as the CO-OP shared branch network, mobile banking, and bill pay."
Travis said BECU has received a nice boost from Bank Transfer Day and all that led u to it on Nov. 5, 2011. "People were just ready to move, and we had the right reputation and the right sales process. We were in the right place at the right time with the right tools."
5 Steps To Effective Cross Sales At The Point Of Sign-Up
TUKWILLA, Wash.-To effectively cross sell a new member at sign-up, the front-line team must consistently follow five steps.That is the stance of BECU, which adopted a consultative cross-sales approach four years ago that today the front-line team uses with a great deal of success.Skott Pope, senior member solutions manager, said the approach is called "The Member Advantage," a product of the Phoenix-based Integrity Solutions. "We use what is called the 'AID INC' process," said Pope. "We interview the new members and try to identify-and get agreement from them-what their wants and needs are. We know these people are coming to us because they don't want to pay the $5 at BofA, so they are value-driven. It is up to us to figure out what else they might need that they may not even be thinking about."The five steps are: approach, interview, demonstrate, validate, and close. "The approach step gains trust and rapport," said Pope. "Interview gets to members' needs, and that is the biggest part of the process. Demonstrate lets us show members how we can meet their needs. Validate reinforces people's trust and belief in you-here is where we check to make sure the member understands what we have told them."The negotiation step is where the credit union addresses problems or objections, and then the member consultant closes. "If you have done everything right, the close is pretty much finishing up the paperwork and making sure that when people leave they understand the value they are receiving. We summarize and say, 'This is what you accomplished today-you have avoided the $5 debit fee and you are also saving $88 a month on your car payment.'"Pope said BECU chose the Member Advantage because the sales approach allows the credit union to not only conduct a consultative cross-sell but to explain the value of credit unions. "We have to help members understand how the credit union works. We can explain that bringing deposits here allow them to get other great services, like loans, and how the profits from loans go back to the members."
