"Credit unions can do a much better job of leveraging family membership or even SEG development," said Bryan Clagett, chief marketing officer at the software solutions firm. "Fundamentally, banks and credit unions, especially credit unions, have a limited growth opportunity and in general most have done a fairly poor job of consistently generating family referrals. As financial institutions move more toward a digital venue and online transactions they’ve lost some of the opportunity for referrals, which traditionally are at branches. Why not on microsites or member surveys ask members to refer a family member, co-worker or neighbor, so they too can take advantage of being a member?"
1st Advantage Credit Union is the first to pilot the program, and Jim Craig, vice president of marketing, has high hopes the move will help with tracking and the overall management of its existing referral program.
"For the past year and a half, we’ve been running the typical referral program handing out cards to members that come into the branch or open loans and we’ve had a decent response rate, but we were looking for ways to get into more touch points," said Craig. "We’ll get about three to four referrals a week, so it’s enough that we know the program is worth continuing, but I’m a big believer in leveraging data, and we saw this as a way to support the program."
With a focus on keeping it simple, the referral engine has been designed to be flexible, customizable and easy to track referrals.
"Financial institutions can tailor offers to their need and creative, we’re out of the picture," said Clagett. "We’re out of the picture and pretty much just provide the motor, financial institutions design the car. So if they want the referral to go out with their member survey, tie it to loan promotions or integrate it with their social media efforts it’s completely up to them."
Of interest to Craig was the end-to-end tracking capability, which allows him to learn everything from who referred whom to which incentives generated the most results. For now the Newport News, Va.-based credit union plans to tag the referral onto its ongoing biweekly Web-based member survey program at the end of its online loan application. On its website will be a banner that states, "If you love us refer us," which when clicked will lead to an automated referral page.
"We can track the invites, see who opened the offer, clicked to the referral page and even who came in to collect their incentive," said Craig. "Our member survey program has given us insight into our members and provides good feedback on our delivery channels and our service so this will be a great test for tracking the referral program. Member referrals are a powerful and inexpensive way to get new members."