Central Florida EFCU weaves dreams into latest promotion

ORLANDO, Fla. – Central Florida Educators Federal Credit Union has turned one Native American legend into a marketing bonanza. “We knew we wanted to develop a multi-purpose unsecured loan promotion and somehow during the brainstorming session the legend of the Native American dream catcher came to mind,” said CFEFCU Senior Vice President of Marketing Jennie Sims. “According to legend, only the good, magical dreams can weave their way through the dream catcher. So anyone who possesses one will realize good dreams and it clicked as the focal point of the promotion. It would help us show members how we can help them live their dreams.” According to Sims, research then analyzed multiple scenarios regarding potential outcomes of the promotion. For example, if the loan had been offered at 9.75% APR or 10.50% APR rather than the 9.99% APR that was set, what would the impact be for the credit union-both short and long-term? With no benchmark data available, economic and competitive conditions were reviewed along with data for the same time period in 2001-though signature loans were not a promotion focus at that time. “You can never do too much research. Since signature loans are non collateralized it is so important to look at the whole portfolio before running such a promotion,” said Sims. “Because if you do bring in more loans than you thought you would then you have to make sure you are in a position to be there. We tried our best to be prepared for any contingency and we looked into the possibility of going over and knew it wouldn’t impact our financials.” Scheduled to run from June 1 to July 31, the Dream Catcher concept was combined with a rate of 9.99%APR for loans up to $12,000 and terms up to 48 months. Working with two graphic artists CFEFCU created graphics for the Web site and visual merchandising including posters, mini posters, inserts, banners, employee buttons and four-color direct mail postcards. In addition actual dream catchers were on display at branches. Members who closed on a Dream Catcher loan received a gift catalogue and were handed a certificate valued between $16 and $75 to choose from a minimum of 52 gifts ranging from jewelry and appliances to portable karaoke machines and DVD players from Chicago-based fulfillment firm Bennett Bros. Inc. Since CFEFCU had an existing relationship with the company a volume discount on items was provided. Items selected by members were shipped free of charge and completely handled by Bennett Bros. Inc. The seven member marketing team also created an employee incentive of a choice of a full breakfast or pizza/salad lunch delivery to the branch that met or exceeded its goal. In addition, upon meeting the corporate goal of $2.75 million in unsecured signature loans all non-branch / non-member service center employees were treated to lunch. “We wanted team effort and that is why the employee incentive served as a team building exercise,” said Sims. “Weekly updates on branch progress were posted and our staffers really got into it and started sending e-mails of encouragement or challenges to each other.” Targeting households with a minimum income of $50,000 and primary members between the ages of 30 and 60,CFEFCU sent an additional 20,000 direct mailings to those members who had not yet taken advantage of the offer halfway through the promotion period. “In marketing we tend to always focus on who responds to a promotion but for us 17.42% of the total dollars disbursed came from members we sent the second mailings to,” said Sims. “While the response rate viewed in a vacuum could be considered low, in actuality the results were successful – a total of $830,612 with the average loan $6,698.” According to Sims the campaign proved to be a success beyond CFEFCU’s dreams. “The real success story behind the Dream Catcher promotion was that so many employees contributed to make it a success,” said Sims. “All but two of the 11 branch goals were met with Loan-by-Phone area and one branch producing 275% and 225% of goal respectively.” CFEFCU added $4.769 million to its loan portfolio with 860 new loans with an overall loan averaging $5,545. In addition, although the promotion expenses were higher than previous promotions($252,000), Sims says the net income was also significantly higher -over $700,000. Wondering what happened to the dream catchers in the branch? Each branch’s top producers got to take them home as a souvenir. [email protected]