Big Data Offerings Is a Growing Trend Among CU Vendors
More closely analyzing transaction data to better understand member behavior continued to make inroads with credit unions as another large credit union payment organization announced a new data analysis tool.
Card Services for Credit Unions, the association of credit unions that processes payments on the FIS platform, has brought out a tool provided by Visa to help Visa-issuing credit unions better understand and use their member’s card data. The tool CSCU is offering is called Visa Vue Online, a web-based application that will enable member credit unions to analyze credit and debit cardholder usage, providing valuable insight into members’ spending trends and leading to more effective marketing strategies and increased profitability, CSCU said.
“VVO is a powerful portfolio management tool that allows a credit union to be more proficient and successful with their marketing campaigns. By using VVO, our credit unions can easily segment and target different cardholder behaviors with an appropriate marketing message that incents a change in behavior,” said Kristi Mackey, assistant vice president of client services and product at CSCU. “Ultimately, VVO helps a credit union be more effective in their efforts to drive increased usage, volume and interchange revenue.”
The tool provides credit unions with a less expensive way of accessing basic card usage data, including transaction type, interchange fees, product and merchant type. VVO is available with five levels of portfolio performance data based on a credit union’s budget and needs. CSCU members receive discounted pricing on VVO and can upgrade the level as needs change, the association said.
“The ability to data mine our cardholder portfolio lets us more effectively target our marketing campaigns to drive up transactions, which in turn increases interchange fee income,” said Linda Sojat, vice president, payment systems, Envision Credit Union, Tallahassee, Fla. “VVO is the only tool of its kind that supplies access to debit card data, so it absolutely gives us an easy way to identify potential areas of profitability to help combat [the impacts of] the Durbin amendment.”
The VVO application will also provide a lower cost approach to data analysis than that offered by consultants and specialists, but some credit unions have taken that route as well.
The Members Group, a payment processing CUSO affiliated with the Iowa Credit Union League, has made a deal with IQR Consulting, a data analysis firm, to provide the firm’s in depth analysis of credit union card transaction data to member credit unions. The 86,000 member, $1 billion New England Federal Credit Union took the CUSO up on the offer.
“We have what we believe to be very attractive cards with very attractive pricing and options, but we just have not seen the kinds of growth we want,” said John Hood, senior lending executive at the Williston, Vt.-based credit union, explaining why the credit union hired the consultancy.
Although it was too early to have firm results, Hood said the credit union expected the analysis to lead to deeper insights into member behavior that will help it tailor marketing and other card management strategies later this year.
For example, the credit union maintains two platforms, one a platinum Visa card with rewards and one without rewards. Although NEFCU thought it had segmented the cards among its members along logical lines, there were still members who had the nonrewards card who acted like they had the rewards card and NEFCU hoped IQR could help them understand and market to those members more efficiently.