When one of your members reaches for their wallet, the desired outcome is for them to choose your credit union's card. Transactions and their corresponding metrics are either the drivers or potential failures of a financial institution's business model, but with the average American enrolled in 14 different loyalty programs – how can credit unions compete for and achieve top-of-wallet status?

"Reward and loyalty programs are very popular, and at their most basic, incentivize behaviors driving members to use their cards to earn rewards like cash back, points, miles, etc. But having a rewards program doesn't automatically equal success. The challenge is to design a rewards program that uses insights from data analytics to select the right incentives to influence behaviors making your credit union stand out from your competition," says Mike Knoop, CEO at ampliFI Loyalty Solutions. "For example, a debit or credit rewards program can be structured around traditional rewards like cashback, travel, merchandise, and etc., but our research indicates that innovative programs that utilize real-time engagement and instant access to points drive more engagement and increase cardholder swipes and spend more effectively than cash back only programs."

Magnetizing members to your rewards card

Instant gratification drives today's consumers. It's no longer enough to only deliver great service in the branch – financial institutions have to deliver to members in real-time during relevant interactions like when they are making a purchase.

According to Knoop, the data shows that cash-back only programs or programs with limited redemption choices are less impactful, drive less traction and influence less spend over time. Members gravitate to personalized, easy-to-use rewards programs that offer a variety of redemption choices. Staying top-of-wallet then, requires customization, choice, and simplicity, which can be achieved through an analytics-driven rewards programs.

Driving engagement through analytics

Every purchase, every swipe, and every transaction tell a story about what is important to your members, and this data can be used to create more engaging and personalized rewards programs.

For example, you can integrate rewards programs into the POS system, allowing cardholders to access and use their rewards immediately at the point of sale in a "cash-like" way. And when merchant POS integration isn't possible, you can still allow members to use their points after the transaction by thanking them for using your card and offering to apply points to their recent purchase via text message reward notification.

"Innovative programs such as these provide us with the unique ability to connect with the member at the right time with the right offer," says Ron Silvia, Chief Revenue Officer at ampliFI Loyalty Solutions. "So, you can meet members where they're at with personalized offers based on their specific needs."

Credit unions can also increase engagement and uphold their commitments to their communities with specialized programs. "We served a credit union in an area that was hit by a hurricane," says Knoop. "Wanting to support our client and help by doing our small part, we quickly developed a promotion that allowed members to donate their points to a relief fund to help the credit union members impacted by the event."

Credit unions face intense competition on all sides, from large banks to affinity card programs like the airline cards. For your credit union to stand out, design a program that includes analytics -based strategy rewards program which will help you cut through the noise. The result will be stronger engagement, increased loyalty, and allow you to stand out and allow your member to feel even move connected to your credit union.


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Nicki Howell

Nicki Howell is a freelance writer with over a decade of experience writing about credit unions, finance, commercial real estate and technology.