MIRAMAR, Fla. -
Almost every large employer either already has a credit union or isn’t interested in offering credit union services to its employees. Combine that with the fact that small businesses are increasingly becoming a bigger part of the employment landscape, and it’s clear that credit unions need to be focusing their SEG recruitment efforts on small to medium-size businesses.
The catch: what has always worked for credit unions in approaching larger businesses doesn’t always work with smaller businesses. That’s why Eastern Financial Florida CU has refined the way it reaches out to small and medium-sized businesses.
“Small business owners can be hard to get in front of if you’re targeting them to become a SEG,” said Gary Lanier, SVP-sales and member services (and currently co-CEO along with the CU’s CFO while the board seeks a replacement for Stephen McGill, who stepped down earlier this month).
Lanier will be sharing how his credit union uses business services as a way to get Eastern Financial’s foot in the door at small businesses at Credit Union Journal’s Grow Show, April 27-29 in Orlando.
“The focus will be on using business deposits and business loans as a lead to get new SEGs,” he explained, noting Eastern has been using this strategy for a little over two years. “We knew we needed to get into the business services arena–members wanted and needed business services, and some of them were already covertly getting business loans by using home equity loans, etc. We figured we could use business services as a means to develop new SEGs, but we didn’t expect the response we’ve gotten. I’d say about 95% of businesses that use our business services let us come in and talk to their employees about becoming members of our credit union.”
Eastern Financial has about 900 SEGs, of which, approximately are the really active “core” SEGs. Lanier estimated that a little more than 100 SEGs are small businesses they were able to lure in by promoting business services to them first. “We have a lot more business deposits than that, but some of those are businesses with only one or two people, so we don’t really consider them SEGs,” he added.
Perhaps the most important rule when going after a small business as a SEG: don’t start out by selling the benefits of becoming a SEG.
“You have to approach them differently,” Lanier offered. “When we first go in there, we’re not even going to discuss the SEG opportunity, it’s going to be all about our business deposits and business loans. You have to lay the groundwork for a business services relationship first. One you’ve solidified that, then you can discuss becoming a SEG.”
And when you do, small business owners likely will be very interested in what you have to offer because the cost of offering benefits to employees just keeps going up, and becoming a SEG is a totally cost-free way of offering employees a perk.
