COLUMBUS, Ind. -
The $600-million credit union has introduced a program offering monthly drawings to members enrolled in its Super Savings Account program, and most recently awarded winning members Apple computers and iPods. This month, the credit union awarded a Wii system and PlayStation3 gaming package.
Participants in the program are eligible for 10 different monthly drawings offering prizes up to $1,000. At the end of each year, members can enter the grand prize drawing valued at $5,000.
In exchange for the opportunity to win prizes, the accounts pay a lower interest rate than the credit union’s regular share account. The Super Savings account pays 0.50% while at presstime the regular share account was paying 1.4%.
“This is something we believe will appeal to small savers,” said Nan Morrow, vice president of corporate development for Centra CU, who got the idea from the Filene Research Institute’s i3 Group. “We’ve test-marketed this at two branches for two months and rolled it out at 20 branches.” Morrow was named to the i3 Group in November.
During the two-month pilot in April of 2007, more than 300 accounts were opened with an average balance of $185. Morrow said there are now between 1,400 and 1,500 accounts open with an average balance of $400.
“It’s a new product with an innovative twist on savings,” Morrow said. “People like to win prizes.”
On the surface, it may seem like the success of Centra CUs program was simply putting the carrot in front of the horse, but it is actually the result of a campaign that pays close attention to demographics and market niches, according to Morrow.
Prize categories are evaluated and changed each month. Some months, CCU will award cash or gift cards. Some months, as was the case recently, they award electronics.
“We look all the time at the prizes we offer and change them throughout the year,” Morrow said. “We’re always looking at what we can do to attract new accounts and appeal to a wide variety of market segments.”
Centra CU is believed to be among the first financial institution in the country to offer financial rewards in exchange for savings, but word is slowly getting out about the popularity of the Super Savings program.
“A couple of credit unions have adopted it in one form or another,” Morrow said. “ELGA credit union in Michigan and FORUM in Indianapolis are the two that are up and running that I know about.”
She added that several other credit unions have called requesting information on the program’s features and for advice on how to setup a similar program.
Although, Centra CU managers try to market the prizes to a specific niche every month, it remains a random drawing.
“A woman in her 60s won the Wii game package (which) was set up for a young person’s demographic,” Morrow offered.” She was very happy to win it anyway, and said she intends to use it when her grandkids come to visit.”
