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Credit union's portfolios are typically under-penetrated. The average credit union's penetration rate is just 14%, which reflects a phenomenal opportunity. On average, 100 new, active cardholders will earn the credit union an additional $18,780 in Total Annual Revenue (See Table 1).
So, what can credit unions do to help increase their penetration?
First, and foremost, if you want to be successful in acquiring new credit card accounts in today's market, you need to offer members a competitive product. The competition is offering Platinum, introductory and/or balance transfer promotional rates, ongoing competitive rates, and enticing reward programs. If you're not offering the same, it is going to be extremely difficult to attract them to your credit union's credit card, especially when the most common reasons members pick an alternative credit card to carry in their wallet is exactly for those reasons. You should also regularly review the solicitations that you personally receive in the mail, to ensure your program remains competitive.
If you're convinced that your program is competitive, then it is time to actively acquire new cardholders. But, you must recognize that potential cardholders will respond differently to different marketing channels and the key is to have a well-rounded acquisition campaign that includes all available marketing channels, so that you can catch the attention of more potential cardholders regardless of their individual preferred channel.
For your next acquisition campaign, consider including all the following marketing strategies:
When credit unions put out a competitive product and all encompassing acquisition marketing strategy, success is sure to follow!
This sponsored content article is provided to the credit union community for shared insights and knowledge from a recognized solutions provider in the industry. Please note that the views and opinions offered here do not reflect those of Callahan & Associates, and Callahan does not endorse vendors or the solutions they offer.
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July 21, 2008
7/26/2012 03:58 PM
Nice to see the "Little Guys" get their credit (No pun intended!)
Great article...I am passing this onto our our senior management.
Great statistic on how 100 new cards could earn the credit union almost $20,000 in Total Revenue.
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