For years the tendency has been to try to push members in the technology channel where we want them. As adoption rates start to plateau and we try to think of ways to get more members using online technology, why not lead them?
The PEW/Internet & American Life Project Internet Use Study estimates that 67% of consumers have access to the Internet. The study found that more than twice as many consumers check email than those that login to online banking to check their account. How can a CU capitalize on this trend? Bring the technology to the member.
A growing number of CUs are switching from a “push” approach to a “lead” or “grow” approach when it comes to increasing technology usage. The current “push” strategy leaves out a large segment of members that are comfortable with the Internet and are just not ready for online banking technology, i.e. to get eStatements you have to sign up for online banking. Moving the products to where the member is more comfortable can lower the barrier to acceptance and create an opportunity to lead the member to the transactional side.
Are CUs Focusing on Wrong Group?
When it comes to using the Internet and digital communication, every CU's membership can be divided into two distinct groups: 1) online banking users (transactional members) and 2) non-online banking users (informational members). The only varying piece amongst CUs is how many members are on each side of the line.
In looking at the chart above, the larger number of members are still on the left of the online banking divide. For example, what is your CU's online banking penetration rate? Ten, twenty, forty percent of your members? The other side of that number means that 60, 80 or 90% do not use online banking.
With the informational member, getting them there is the hardest part. Once they enter the channel they will move farther down the technology path towards the ultimate “super user”. Digital communication with member will help start the process of moving a member up the technology channel.
A New Shift in Thinking
Isn't our goal to get members to use as many online services to build loyalty and profitability? So if members won't come to online banking, why not lead them there (you can't make a member take a product they don't want until they are ready). To raise the chance of getting a member online, secure products such as e-LERTs, eStatements and check images are shifting to both sides of the online banking divide to attract more members.
One example: The industry is seeing an increasing number of CUs offering eStatements with check images located both inside and outside online banking. Why is this? If check images storage and access are paid for (not a variable cost) then why not put access on each side of the online banking divide through eStatement access? CUs are attracting a portion of members that want check images but are not ready for online banking. The eStatement savings will also supplement the cost of providing check images in both places.
Another example: Why would an online banking provider partner with an operational e-LERT product want to partner with a Marketing e-LERT provider? It's simple, both are trying to expand the reach and service to 100% of a CU's membership. Both sides know that once a member enters the channel where they want the member will eventually move towards the transactional technology side. Granted some will move faster than others
Creating an Integrated Communication Strategy
It's not an either/or situation. When talking about digital communication and getting information to the member, CUs should deploy as many means as possible and let the member pick where they want to enter the technology channel. Marketing e-Lerts and check images inside eStatements move that technology farther to the left of the online banking divide. Member that adopt the technology at this point will grow into the super users at their-own pace. Not the pace of the credit union.
An integrated communication strategy focuses on online tools to create opportunities to sell products and create competitive advantages. When a CU deploys as many tools as possible, both inside and outside online banking, it creates entry points for members along the technology path. In deploying tools that create these entry points they;
- Chase 100% of their members;
- Fill some of the voids inherent in other Internet products
- Expand the strategic contact point;
- “Grow” the member into the next technology step; and
- Generate additional revenue
CUs using Internet tools as part of a web strategy have found that they are successfully creating a strategic contact point to inform and interact with their members. In addition, they have been able to increase business and generate additional revenue by “pulling” members to their web site for information, “targeted” offers and electronic delivery of products. Most tools are reducing “per transaction” costs, enhancing interactivity and delivering products and services 24/7.
This article is just one in a series of articles on how credit unions are using digital communication tools reach 100% of their members to cut costs, speed delivery and improve processes. Here are links to the other related articles in the series:
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