A credit union that wasn't even founded until 1981 and didn't start serving companies outside its sponsor until 1996 is making up for lost time.
The nearly $1-billion Baxter Credit Union-chartered 23 years ago by Baxter Healthcare-has established a formal program it says has been quite successful in helping it attract new select employee groups.
"The board and senior management has to have the vision of why they want to go out and get new SEGs," Eileen Cherry Clark told The Credit Union Journal's SEG & Business Development Conference. "In our case, Baxter is a wonderful company, but like the stock market, you want to go out and diversify."
That senior management level support was just the beginning, stressed Clark, who said it has been critical to get similar support from other departments within the credit union. For instance, Clark noted that after one call at a sponsor the credit union opened 156 accounts. After the initial happiness over the new members, the reality set in that it had to sign all those people up for membership. That required another two and a half weeks, she said of an early lesson learned.
Baxter Credit Union does not invest in mass media advertising of its services. Instead, it invests in what Clark called "point-to-point" marketing, the in-person calls upon businesses.
"What I find when hiring is the people who come into my department are the limelight," she said, noting she looks for professionalism and likeability in new hires. "Then other departments want to hire them, and you have to get more people; but it's a good problem to have. What you can't train is initiative and motivation. I've had situations where both our reps are working at three in the morning at a SEG. That's motivation."
SEG Criteria
Baxter serves 71 SEGs, but each has enormous potential, she said. That's because the credit union doesn't pursue any employer of less than 250 employees. Of the 13 signed last year, more than 21,000 potential members are employed at those companies. "Don't be intimidated by the large SEG," she urged.
In Baxter's case, it serves companies in a perimeter around its service centers. It pulls a Dunn & Bradstreet report to ensure financial soundness and also seeks companies that have what she called a "good mix." "A good mix of people to us is to make sure they don't just have workers, they also have the management," she said.
When eyeing a SEG, the key is to determine just how open they are to being a partner with the credit union. "If they say they have a no solicitation policy, walk away," Clark exhorted. "Having the full support of the company is very important."
Once Baxter has determined which potential groups to go after, it uses a variety of methods to get the CU's foot in the door, including goodie bags with all sorts of logo paraphernalia-including the much coveted ice scraper, since the CU is headquartered just outside Chicago, where clearing the ice and snow off a car is all a part of getting anywhere during the long winter months.
As soon as BCU gets its foot in the door, it has to make the most of the opportunity. "This is not the time to push rates," Clark suggested. "Push benefits, push the value to the employer of offering this to employees."
Baxter put together a "Sweeten Your Employee Benefits" post card, for example, that helps business owners and/or HR people at a prospective SEG realize the advantage in offering a free employee benefit in the form of credit union membership.
Just as important as finding new leads for new SEGs is penetrating existing SEGs. When Baxter initially set up goals and incentives, the CU tied the incentive for business development officers to getting a letter of intent signed with a new SEG. But what the CU discovered was that wasn't enough to incent follow through and penetration of the new SEG.
"Now, we have an incentive that encourages follow-up on the back end, too," Clark explained. "They get a percentage of the incentive at LOI, and the rest of the incentive is tied to the participation rate."
It's Happy Hour
If a credit union is serving its SEGs well, it should have no problem in getting the all-important testimonials that can be used when visiting potential SEGs. Baxter has gone one better with this.
"If we've got a SEG in an business park, we'll get them to sponsor us and have a happy hour at their place of business and invite the rest of the business park to it," Clark offered. "We get an introduction and a major testimonial, and now we've got a whole new set of leads to follow up with."
Among some of the things Baxter has done to generate leads:
* Use resources like Crane's Book of Lists and Dunn & Bradstreet
* Co-market with complimentary companies
* Get involved with community organizations like Chamber of Commerce, Rotary, etc.
* Participate in an HR tradeshow.
The key to these sort of networking opportunities is to recognize the difference between networking and selling. "Networking is not a platform to tell people how wonderful you are," Clark advised. "You've got maybe 60 seconds. You're not closing the deal, just trying to get a meeting to come in and then try to sell the credit union.
