Three Reasons Why Now is the Time for eStatements

Credit Unions could be faced with a significant increase in the cost of sending required statements in the coming months. Why? The U.S. Postal Service announced in October that it was taking drastic actions to protect postal workers. Although this action is more than warranted, it translates into possibly a 20% increase in postage costs. eStatements offer a number of strategic opportunities to combat rising statement costs and gain strategic business advantages that generate additional revenue.

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Credit Unions could be faced with a significant increase in the cost of sending required statements in the coming months. Why? The U.S. Postal Service announced in October that it was taking drastic actions to protect postal workers. Although this action is more than warranted, it translates into possibly a 20% increase in postage costs. eStatements offer a number of strategic opportunities to combat rising statement costs and gain strategic business advantages that generate additional revenue. Here are three strategies to consider:

1. Control Rising Postage Costs through Digital Presentment

The possible increase in postage cost is coming at a time when CU executives are challenged with declining income from historically low interest rates. In most cases, credit unions can eliminate costs by transitioning their statement delivery process from paper to an electronic method. Consider these eStatement facts:

eStatement cost savings increase, as postage continues to increase for paper delivery
eStatement costs do not increase when postage increases
The higher the eStatement adoption rate, the more your CU will save

Here’s an example. If a 20% increase in postage occurs, a CU with 30,000 statements delivered each month could be faced with an increased cost of $21,000 per year. If this same CU implements eStatements and achieves a 10% adoption rate, the CU could realize a cost savings of approximately $18,000 per year. By implementing eStatements the CU’s net cost only rises $3,000 per year. An adoption rate of 12% could offset a 20% postage increase and for every eStatement delivered over the 12% rate the CU could begin to reduce operating expenses!

TIP: In estimating your CU’s adoption rate expect approximately 40% of online banking users to switch to eStatements and the same number of non-online banking members to sign up if eStatements are delivered outside your online banking product.

2. Tap Your E-mail Database for Hidden Revenue while Providing Statement Information

There’s gold in those e-mail addresses. CU’s need to begin to use e-mail marketing to keep in touch with members by sending newsletters, promotions, updates or offer special deals. This strategy will not only reduce costs, it can increase services per member.

Surveys have shown that permission-based e-mail marketing helps sell products and build member relationships. A survey, conducted by Callahan & Associates, reported that nearly 70% of credit union members surveyed said they are willing to give out their e-mail addresses to their credit unions, and another 11% said they would do so under the right conditions.

Steps to take are:

Formalize a strategy and a budget for e-mail marketing campaigns
Get the member’s permission to use his or her e-mail address
Create a member e-mail database
Use MCIF information to develop special, targeted offers

3. Use eStatements Proactively – Make Every Contact Count!

Getting the Right Offer, to the Right Member at the Right Time generates revenue.

eStatements with custom, targeted offers will better enable your credit union to compete for your member’s business in an efficient & cost effective manner. Targeted banner and button campaigns are crucial to an essential part of your eStatement delivery, which helps to get the right product in front of the right member, at the right time.

EStatements can:

Provide thousands of new marketing opportunities per year to generate additional revenue
Present targeted, personalized offers for new services to each eStatement member
Build and enhance member relationships
Increase member loyalty
Use existing technology to deliver products & services 24/7

How Does $80,000 in Savings Sound?

Since implementing eStatements in September 2000 NWFCU (Herndon, VA) has achieved a 15% adoption rate and has saved over $80,000 in statement cost!

Joan Stroud, Marketing Manager of NWFCU hasn’t stopped with just the savings. She is making every member contact count. This summer NWFCU capitalized on an eStatements campaign that provided and presented targeted offers to eStatement members that did not have a car loan at NWFCU. Stroud is happy to report ''$2,300,000 new car loans in a click!''

Put $$ in Your Pocket ~

DigitalMailer, Inc. is an eStatement provider that assists our clients in gaining a strategic business advantage over competitors via electronic statements, newsletters and e-mail marketing campaigns. Our eStatement products were designed by CU professionals to reduce operating expenses, enhance cross-selling opportunities and increase revenue for our clients. We service credit unions and mortgage service providers. For more information on DigitalMailer, Inc. please go to http://www.digitalmailer.com

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