Leveraging the Mobile and Digital Channel for Growth

Keeping pace with today’s growing market of “mobile-first” consumers can be challenging. For the most part, credit unions are rising to the task, with many doing a good job investing in mobile and digital solutions that cater to this rising demographic. With a recent World Bank study suggesting that about 56% of adults use their mobile devices to check their finances (with Americans being closer to 70%), it only makes sense to ensure these channels become – and remain – a priority.

The reality is that creating a robust digital platform is only the first step. Once members have access, how do you keep them engaged over time? One solution is to take a page from the online retail playbook and focus on creating effective, targeted user-friendly experiences. Since both the initial engagement and the ability to keep members engaged are major elements for growth, credit unions are now leveraging their mobile and digital technology in smarter and innovative ways when it comes to their approach for marketing and the account application processes. This can give them better results in everything from higher conversion rates, lower abandonment rates, and ultimately, improved member experience.

The retail/e-commerce industry has been successfully adapting to the preferences and needs of mobile consumers for quite a while now. In that time, they have learned the value in effectively leveraging their customer data (and analytics) to make the most appropriate and relevant product suggestions initially, and then follow that up with a hassle-free, streamlined customer onboarding experience. This in turn discourages cart abandonment, increasing sales. Credit unions can achieve similar success by not only marketing the right products and services to the right members at the right time, but also creating and supporting a truly frictionless checkout process for them via their mobile devices.

A real-world example is the Indianapolis-based Elements Financial Credit Union ($1.5 billion in assets), which has shifted its focus over the past few years to a more digital-first mindset. The credit union has updated many of its systems and is in the process of replacing a legacy onboarding system with a faster digital sales platform.

“Digital excellence is one of the key pillars in our organization,” Tim Greene, vice president of innovation for Elements Financial, said. “Today, the majority of our members first engage and then continue to interact with us through the digital and mobile channel, so it’s critical we offer them the best experience possible. That means being available to them and being able to reach them at their convenience, whenever, and wherever, that might be.”

The credit union is leveraging mobile technology not only to make access easier for its existing members, but to reach new potential members by going directly to them. Recently, Elements Financial partnered with Butler University in Indianapolis to provide special account opening offers and financial guidance for students, faculty, staff and parents. The program, which already includes online, self-guided, interactive learning modules as well as onsite workshops, will also have the ability later this year to open accounts onsite for new potential members, allowing them to establish relationships quickly and in a timely manner. For new students especially, this will remove the barrier of having to go to a physical location to complete an application, and make the process as simple as greeting them at the onsite events, getting them excited over their products and moving right to setting them up with a student checking account and their branded student debit card. Because often many of these students are not local and represent a new member opportunity for Elements Financial, which would have been more difficult to reach outside the digital channel.

By adopting similar mobile and digital approaches, credit unions are improving their sales and member growth through robust, frictionless access and a simplified user experience. However, more importantly, a better digital platform means they are also able to make much better use of valuable member data that they already possess. Arguably, it is this approach that represents the biggest shift in how credit unions should think about growth. The most successful retailers are the ones that focus on truly knowing their customers – their needs and preferences – and then adjusting their marketing and creating programs to reflect that understanding. This, in turn, helps ensure they always present the most relevant information and best products to the right customer at the most opportune time.

It is this kind of “personalized service” that should be the standard for credit unions as well. For many, the focus has always been on “share of wallet” as the main way to measure success in both marketing and sales, but using this alone can be shortsighted. Today’s successful retailers tend to consider the value of their customer relationships over their lifetime. Doing so makes those relationships more meaningful for their customers, which ultimately make them more profitable for the retailer. Credit unions should consider doing the same and think about the lifetime value of their members, not just their current expenditures. This is especially true when targeting millennials and Generation Z consumers. Not only are these groups very sophisticated when it comes to their digital and mobile needs, they also present great opportunities to engage in long-term relationships. As they grow and mature as members, they are going to need more products and services from their credit union, from auto loans, to mortgage loans, to retirement and college planning.

A shifting focus on digital marketing and catering to mobile-first consumers has helped redefine today’s retail industry. Similarly, this can do the same for credit unions, especially as mobile banking platforms become more common. However, with increased competition from the largest financial institutions, as well as other non-bank, tech-savvy disruptors, those credit unions slow to adapt or look for innovative ways to leverage their own mobile and digital technologies could find themselves left behind. The missed opportunity costs are real, and in retail, we’ve seen several established brands fall by the wayside while others have fully leveraged these technologies and grown dramatically. The future for credit unions is a bright screen and those that will embrace this will be better positioned to thrive in a digital world.

David Eads is CEO for Gro Solutions. He can be reached at david@grobanking.com.