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Why Credit Unions Need to Focus on Member LTV

As you survey your current marketing initiatives, consider the lifetime value of your members.

By Thom Villing | Updated on March 13, 2017

Lifetime Value (LTV) has been discussed as an important metric in financial services marketing for many years. If you aren’t familiar with the term, it is basically defined as the projected revenue a given member will generate over the course of their relationship with the credit union. However, I would submit that it is often overlooked when making decisions about the aggressiveness, or lack thereof, of a specific marketing initiative.

Let me give an example. A few years ago, many credit unions were offering very dramatic interest rates on checking accounts. We had one client who ran a checking promotion based on paying 4.01% APY. Although there were many requirements involved including a high average daily balance, monthly transactional minimums and the like, this offer was extremely compelling in a market environment when even large CDs were yielding only a fraction of this interest. Suffice it to say, this promotion generated a great deal of attention and many people signed up.

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