Patelco Campaigns for New Cards, Members and Pets

Patelco Credit Union ($7.1 billion, Pleasanton, Calif.) understands how to run a campaign, whether it’s a massive card reissuance program, member acquisition direct mail campaign or social media-driven pet calendar project.

Erin Mendez, president/CEO of Patelco – which began in 1936 with only $500 in assets and a few employees at the Pacific Telephone and Telegraph Company, and now has 37 branches and more than 355,000 members − explained the credit union flipped its cards three years ago from Visa to Mastercard. Unfortunately, all the cards issued in 2016 expired in 2019. “We really needed to reissue cards en masse.” Mendez explained Patelco also needed to assess its activation program and how to stagger cards in the future.

“The credit union didn’t really have the expertise in house,” Chris Allen, SVP and chief risk officer for Patelco, said. It selected the Memphis, Tenn.-based Strategic Resource Management, a full-service consulting firm for credit unions and banks, to help the credit union plot out its reissuance course. “SRM has been selected by more than 700 financial institutions to advise in areas such as payments, digital banking, core processing and operational efficiencies,” Andrew Gordon, vice president, project management for SRM, said.

Allen added, “What really intrigued us about SRM was their network of clients, which have done this before and were available to us.” Allen further described that if SRM was not sure of something, it would survey its clients to get an answer for Patelco. “We really liked that; no one’s going to know everything and every massive card reissue is different,” he said.

The credit union worked with SRM for between eight and 10 weeks starting in August 2018. “All of Patelco’s chip cards issued in 2016 needed to be reissued within a narrow time frame in 2019, so SRM worked with the credit union to develop a playbook for the card reissuance process,” Gordon explained.

The planning paid off, as the reissuance program that is currently underway is running smoothly, and has drawn hardly any member complaints. “Our fraud experience is so much lower than expected, because we really tried to think of everything under the sun and SRM was a key driver of that for us,” Allen said.

Patelco began to reissue 160,000 cards, in waves of mostly 30,000 at a time, over a four-month period starting in spring 2019, and incorporated data analysis in the process. “We determined if a member hadn’t used their card in over two years, we weren’t going to reissue them a new one,” Allen noted. “We decided on a specialized marketing campaign to reengage those members. We wanted to make sure to focus on members who were actually using the cards.”

The last time Patelco issued cards, members’ only means of activation was through an interactive voice response system, which presented a number of challenges and was not member-friendly. This time, it shored up its member activation experience – members could activate cards though any ATM (using the same PIN as before), through the credit union banking app, on the website (secured behind Patelco’s firewalls) or via phone.

Patelco hired an outside company to handle the initial phone calls related to activation that it anticipated receiving, so the calls would not flood its contact center. “Quite frankly, the calls coming into that third party are very minimal,” Mendez said. The credit union believes its communications with members prior to sending out cards, placing a sticker on each card and offering easy ways to activate all helped alleviate member stress.

Mendez also noted that Patelco’s preparations for this reissuance will remain in effect for any future expired card situations. “This time, we staggered the cards over multiple years and over multiple months. So, we won’t have this type of massive reissue again.”

In March, Patelco received 2019 Diamond Awards from CUNA for outstanding marketing and business development achievements in two categories: Direct mail and social media.

Patelco won the direct mail award for its member acquisition program, which helped the credit union gain 2,810 new members while considerably surpassing industry benchmarks for cost-per-acquisition.

Rina Johnson, vice president of marketing for Patelco, said, “We truly believe that direct mail is an important tactic, especially from a credit union perspective, as far as generating awareness and driving interest.” Because direct mail can be a very expensive proposition, Patelco worked with a partner to make it more cost effective through specific targeting of potential members. “We also had to convince our vendor, believe it or not, that we wanted to deliver a direct mail campaign that didn’t have an offer. A lot of the big banks just throw money out – sometimes splashing a $500 credit – if you open a checking account.”

Johnson emphasized Patelco did not want to go that route. “We really wanted to demonstrate our value proposition and the impact of our products and services because we truly believe they can stand on their own.”

In 2018, Patelco completed four to five direct mail drops. “Our benchmarks had to do with a new member acquisition goal as well as our cost per acquisition,” Johnson stated. It achieved both goals and then some. “Historically if you have a cost per acquisition less of than $300 to $500, you’re sitting OK with that. Our cost per acquisition on this program ranged from $120 to $160. It was incredibly satisfying that we could bring in new members at that CPA.”

It now augments the direct mail program with some advanced data modeling and analytics. “We’ve taken this program and are now taking it to the next level,” Johnson said.

Patelco worked closely with its vendor to ensure products, such as its popular money market and free checking accounts, stood out. “Because we’re really truly focused on improving the financial health and well-being of our members, we want our nonmembers, who really don’t know much about Patelco, to understand who we are, what we stand for, and products and services we’ve developed.”

Patelco said it ensures direct mail hits its mark by completing pre- and post-campaign analysis. It takes anecdotal information with a grain of salt and really studies what the data says.

The credit union earned the social media award for its “Pets of Patelco” calendar. The calendar consisted of the 12 most-voted-for pet photos submitted by Patelco members through an online contest primarily promoted on Facebook. As part of the campaign, Patelco donated $5 for every pet photo submission, up to $2,000, for the Sonoma Humane Society in California.

With devastating fires hitting Northern California over the last few years, Patelco sought to support charitable efforts in the affected communities. Looking to help animal shelters affected by the wildfires, credit union settled on the pet calendar idea.

“Back in the day, you would always get your calendar from your bank or credit union,” Johnson said. Moreover, “When you look on social media, kids and pets are the top two things that people end up posting about,” he added.

Johnson noted, “This calendar was also an opportunity for us to reinforce our brand and our focus on helping improve our members’ financial well-being.” The credit union also had a goal of increasing its number of Facebook fans. “We reached our goal by 150%.”

Patelco also sought 400 submissions. “We shattered that goal with 2,800 total submissions. It proved it was innovative, fun and just a really authentic way to present who we are and what we’re about, Johnson said, adding, “Social media plays such a critical effort with our marketing activities. One of the things we are really focused on is to engage members and nonmembers with the Patelco brand, but to do it in an authentic way. We’re really excited for the future. I really believe marketing is just getting started.”