Many, if not most, credit unions now have e-mail contact with members, and when the members come calling, someone needs to respond. "An e-mail sitting in a queue is just like a ringing phone waiting to be answered," says Doug Wilkerson, president of RTP Federal Credit Union, which serves companies in and around Research Triangle Park in the Raleigh-Durham area of North Carolina. "Not answering is not OK." Backing up that observation are numbers from the 15 credit unions across the country that participated in the latest Callahan & Associates Survey Consortium, which garnered information from 18,000 online respondents in October. That survey found that 51% had e-mailed their credit union at least once in the past year, and that 88% of them expect a reply within 24 hours. Being able to meet those expectations, plus taking advantage of the marketing and cost-savings potential of electronic communications, means overcoming such barriers as member sensitivity to unsolicited advertisement (spam) and other privacy concerns. But credit unions, with their natural relationship with members, have a leg up. "Almost 70% of credit union members indicated a willingness (in this survey) to share their e-mail addresses with their credit union on several key conditions," says Scott Patterson, e-commerce manager at Callahan & Associates. Those conditions include a very strong privacy expectation, but Patterson points out that federal law prohibits credit unions from sharing e-mail addresses, so educating members to that law can help allay those concerns. Of course, rules and regs play a big role in other credit union functions, but that doesn't preclude e-mail from being part of the puzzle. For instance, at State Employees Credit Union of Michigan, members can choose to be alerted to rate changes by e-mail, which then refers them to the SECU Web site, where the required disclosures are in place along with the new rates. SECU uses a Microsoft product called Bcentral for such targeted information, and like many credit unions, relies on its call center to do the general fielding of e-mails, says David Carson, e-commerce development specialist for the 74,000-member, $500 million CU based in Lansing, Mich. Carson says his CU gets about 50 e-mails a day and finds that the technology offered in the Bcentral program not only allows robust tracking and response creation, but also is relatively inexpensive. "It's extremely important," Carson says of his organization's ability to communicate with members by e-mail. "For the marketing, so people don't have to come to theWWeb site or a branch to see what's new, and for being able to quickly handle members requests and concerns." SECU uses opt-in technology, which means that members have to choose to allow their e-mail to be used that way. On the other hand, $1.9 billion Wescom Credit Union uses opt-out, and offers that option every time it sends a marketing message to a member. "The opt-out rate is only 1.5%, so there hasn't been a strong negative reaction to our e-mail marketing program," observes Brian Siegel, vice president of eCommerce for the California-based CU serving 175,000 members. He also points to the Callahan survey numbers which show "the conflict that many members feel about outgoing e-mail." He notes that 53% of the members who indicated they would be unwilling to provide an e-mail address also said it was acceptable to receive at least one e-mail per month. "To me, this shows that members are very cautious about divulging e-mail addresses, even to trusted partners from whom they are willing to receive information," says Siegel, noting that his CU is a survey consortium member but did not offer this particular one to its members. NOW CATCHING UP "E-mail technology is not new, but credit unions have been perhaps a little behind on using e-mail to communicate effectively with their members and to promote their services and products," Patterson says. But they're working to catch up quickly, observers and participants say, as members increasingly expect e-mail to be as natural a means of communicating as picking up the phone or visiting a branch. That can be especially true for CU's with large numbers of high-tech members, such as RTP, whose SEG lineup includes, among many others, Nortel, the computer-networking pioneer. With one branch serving 13,000 members, only about 4% of RTP's transactions and inquiries go through the teller line, with the rest coming by phone or computer, Wilkerson says. Initially, the 24-employee organization used a single e-mail address off the Web site, but that quickly had to change as the volume grew. Now, RTP gets 75 to 100 e-mails a day, and staffers find themselves in individual electronic communication with members as well as using computers to send out newsletters to members and regular communications with SEG companies. The $54 million organization views e-mail and other electronic offerings as a way of leveling the playing field, especially in a state that's home to some of the biggest of the big banks, and to some large credit unions, too. "On the Web page, we can look just like a $500 million credit union," Wilkerson says. "There may be some things we don't have, but not many. And we can look at adding those." While that kind of one-on-one service, combined with a growing array of services and products, solidifies relationships, "it also raises the bar for us and even, in a way, sort of spoils our members," Wilkerson says with a laugh. For instance, he says, he can see the note of expectancy in the tone of some of the e-mails coming into his credit union. "We get some that say things like, `I'm sending this at 9:12 and expect a response in 30 minutes,'" he says. "We have to keep in mind that it's really just another version of talking to a person, only using a keyboard. They expect it to be pretty much in real time." Patterson, the Callahan e-commerce manager, also stresses that members need to be reminded, clearly, on the Web site that e-mail is not the way to handle urgent requests. Response times are key, and finding ways to deal with that are crucial to developing the low-cost, high-return potential of conducting member relationships electronically, experts say. At Patelco Credit Union in San Francisco, about 400 e-mails a day arrive. A 48-hour response time policy is in place, but the average is about 15 hours, says Lauralee Brown Markus, Patelko's Web relationship manager. The $2 billion outfit also has more than 80,000 of its 200,000 members using its PC-24 online service, a penetration rate of better than 40 %. Handling that traffic is iBranch, a five-member staff that includes branch manager David Cole, all focused on serving members online. Patelco uses e-commerce software from eGain Communications to both create and provide pre-formatted messages as well as to send targeted promotional messages through e-mail. PC-24 users also can receive e-mail account alerts and check images and enjoy such robust features as stop-payments, money-market and CD purchasing, and real-time account changes. All that functionality is well and good, but it won't do anyone any good if members don't use it. That involves marketing, of course, and assuring members that their information is secure. While e-mail can't easily be secured, and credit unions have to make sure members know that, Patterson says, communication with members through a Web site is secure and home-banking sites can also be the place for electronically communicating with members on topics that involve account numbers and other confidential information. Combining new technology with traditional member-relationship philosophy allows credit unions to both compete on service with big banks while operating as the movement always has, managers agree. "Patelco Credit Union has strong ethics," says Cole. "We truly operate as a member-owned company, therefore making smart decisions around technology is essential. "We feel that in always coming from this perspective, our members benefit from enjoying the most sophisticated technology while still being served in a friendly, old-fashioned way," the iBranch manager says. Markus and Cole both stress that opt-in also has to come from top management. "Ed Callahan, our CEO, understands that doing business electronically will only expand in the future," Cole says. "He supports the initiatives of John Shields, our senior vice president of eBusiness" and the iBranch staff. Also at the bottom line of all this . is the bottom line. Would credit union members pay for e-mail services? The Callahan survey found that 34 % of its 18,500 respondents "expressed some willingness to pay for specific e-mail services," that means more than 60 % would not. That's something CU managers can be expected to consider. For instance, at Wescom, "personalized account notifications is an enhancement we'll be adding soon to our site, and we've discussed whether members would be willing to pay for it," says Siegel, the Wescom eCommerce vice president. "Our feeling was that they would not and the results of the survey bear that out. Over 60 % of members would not pay anything for such a service and only 1 % of members would pay more than $2 per month." -


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