This webinar discusses strategies for credit union professionals to defy trends and seize marketing opportunities. Speakers address challenges like communication clutter and generational differences. Case studies show how targeted messaging across channels like direct mail, email and social media increased response rates and loan applications. Personalized landing pages and reinforcing messages boosted online banking enrollment. Integrating channels like video and social media helped attract younger members. Data-driven targeting and testing different age groups produced highest returns. The future of marketing involves understanding members and integrating both traditional and new channels to strengthen relationships and increase loyalty.

1. DEFY THE TRENDS A Webinar for Credit Union Professionals

2. Today’s Speakers Kate Dunn President, Digital Innovations Group Business Strategy Chair, PODi Apps Forum 2008 - 2010 Board Member Digital Imaging Customer Exchange Faculty, University of Richmond Robins School of Business, Executive Education Review

3. General Marketing Challenges Communication clutter Typical American is exposed to 5,000 marketing messages a day notice 52 remember only 4 Four or five generations in play Varied levels of comfort and cynicism with technology, advertising Voluminous amount of information Personal and professional duty overload Loss of personal wealth/employment Anxious and fearful of future

4. The Impact Clutter increases marketing expenses Mixing the mark increases marketing expenses Ultimate implication is failure of the organization YTD Decline in number of Credit Unions of 110 On pace for 252 closings in 2009

5. Sacrificing the Long Term for the Short Term Only 15% of short term sales are the result of marketing, but today’s marketing initiatives are responsible for 85% of long term sales. Source: What Sticks: Why Most Advertising Fails and How to Guarantee Yours Succeeds, by Rex Briggs, Greg Stuart

6. Really Good News “19% of advertising fails outright and 67% could achieve significant improvement that would require no additional spending.” What to tweak: Messaging – better understanding of customer’s motivations Marketing Mix – VeriSign found that 10% of spend drove 98% of actions they wanted Qualification - 80% of all deals are lost due to a in adequate or non-existent qualification process. ES Research Group Study

7. Credit Union Challenges Annual loan growth fell to 3.5% through July 2009; will remain sluggish Increased cost to recruit net, new members As of 2008 the amount stood at $467 Increasing rapidly for those with community charters Failure to grow relationships following ‘best rate’ offers increases marketing costs Minimal differentiation in eyes of potential members

8. Marketing budgets have been reduced: Added cost of regulation NCUA assessment Corporate credit union bailout Bad PR, marginalizes the differentiation Defying the Trends & Seizing the Opportunity

9. The marketplace has delivered us opportunity Big Banks continue to shoot themselves in the foot But there are typically less resources to seize the opportunity People Marketing budget Harder task to reach out Today’s Credit Union Trends

10. Finding New Members: Where to find them? Knowing what to say Expanding the relationship Difficulty lies in your charter SEG more difficult than community New technologies can help Customized URL for Information “CURL” Today’s Credit Union Trends

11. Where do I get the most bang for my buck? Low hanging fruit 40% of credit union members classify themselves only as “moderately loyal” Specifically target most likely candidates Ability to be “granular” evolves once your are in a conversation Significantly reduces production cost Greatest chance to maximize R.O.I. Charter Matters

12. What do I sell first? Does it vary by segment? Can I reduce my cross selling expenses? Can I reduce customer attrition? Expanding the Relationship

13. What can you tell them that will work? Very similar value propositions Share profits – Treat you like an owner Safe, Sound & Secure Opportunity lies in understanding the needs of EACH member WIIFM - Specifically Messaging

14. Should social media be integrated into the mix to improve results How can social media be integrated Big Question

15. In Short Must capture the loan opportunity that exists today Cost effectively Efficiently Prioritize your opportunities Existing members – cross selling Family members – grow membership Focus on member loyalty will pay off Strengthen relationships with on-line banking, broader product participation, loyalty and referral initiatives Improve resource utilization with automation, tracking and decision support Improve marketing ROI

16. Best Practices in Direct Marketing for Credit Unions Replicating Success

17. Case One: Wallingford Municipal Federal Credit Union Business Problem Low response and conversion rates on new loan offers from statement stuffers and traditional generalized direct mail Solution Personalized direct mail campaign to existing members promoting car loans with attractive rates

18. Targeted, Simple Personalization with Succinct Messaging Best Practice: Simple offer and call to action “Save Money” & “Get Pre-Approved First!” First Name Personalization

19. Results Achieved highest monthly loan activity in history of the credit union Exceeded annual loan target after only four months using the program Extended program to other initiatives

20. Case Two: On-Line Banking Business Problem Low on-line banking participation increased cross selling costs and contributed to member attrition Solution Use best practices developed in loan campaign to convert members to on-line banking

21. Targeted, Simple Personalization and Succinct Messaging Best Practice: Simple offer and call to action “free On-Line Service” & “Call for an application” First Name Personalization

22. Results 17% of membership signed up for on-line banking within six weeks Cut back on need for multiple mailings

23. Effective Targeting Custom personalization using gender, age or other demographic information Consider appending data if required Compelling Imagery and Text Keep it Simple Zero in on WIIFM Clear Call to Action Best Practices

24. Case Two: SEG Member Acquisition Customized URLs

25. Why Landing Pages Directs respondent to specific content Relevant fosters relationship Streamlines response process Interactive Gain information to improve analytics and nurture the sale Trackable – provides valuable information for decision making

26. Why Direct Mail Works Add more cost impacting ROI Source: Vertis Communications' Customer Focus® survey

28. Revenues are improved by an average of 18 times with relevanceRelevant Over 3x higher Personalized

29. 2007 Vertis Communications Customer Focus® 85 percent of women ages 25-44 read printed direct mail marketing pieces 53 percent of all women ages 25-44 surveyed who have access to e-mail, read e-mail advertisements 63 percent of all adults indicated the have responded to direct mail collateral offering a percentage discount Women make more than 80% of all consumer purchasing decisions Source: Source: Mindshare/Ogilvy & Mather

30. Case Three: Alerus Financial Business Problem Declining credit consolidation loan applications Low return from static mailings Solution Test the use of a personalized and relevant cross channel campaign against static mailings Age Groups: 25 – 35 36 – 45 46 - 55

31. Multiple Channels: Direct Mail, Email and Personalized Landing Pages Step One: Direct Mail Personalized Personalized Response Mechanism Provides Tracking Relevant Copy & Images for each age group

32. Relevance continued Messaging Real Estate Expanded Minimizing cost of mailing Interactive conversation with prospect Questions capture additional information Thank you structure used to nurture interest Step Two: Personalized Landing Page

33. 3.67% responded to multi-channel version of campaign 60% of applicants were new to the institution Response Rates by segment for multi-channel 25 – 35 3.98% 36 – 45 3.23% 46 – 55 2.64% Response rate from static mailer < 1% Results Highest ROI

34. The Power of Multiple Channels Researchers estimate that 25%-30% of total media time is spent multitasking, and that the more media a person consumes, the more likely they will consume several channels at once Seeing a message in more than two channels increases response by 10% to 15%. Sources: eMarketer Multi-tasking Consumers January 2007; DMA Study

35. Why Personalized Landing Pages? 46% of Americans prefer to respond to direct mail on-line. PURLs: increase response by up to 400% provide automated response tracking provide interactive communication with prospect automate integration with sales channels Campaign changes are affordable Electronic messaging real estate is cheaper than print. Source: DMA Study

36. Why Email as a Channel Links included in emails facilitate response 50% of those receiving permission based e-mail say they are more likely to buy products from the sender in the future regardless of the channel Source: Jupiter Research and Indivia, Epsilon

37. Why Social Media? 1/3 of all American have profiles on social networking sites The average LinkedIn user is 40 years old Most Twitter users are now 35 and older People from 35 to 54 now represent the biggest group of users on Facebook. LinkedIn - business-only has 43 million members in more than 200 countries Sources: LinkedIn: Connecting with Success and Timothy J. Wood, Montgomery County Group Leader of Business Development at OBA Bank, contributed to this article

38. Why Social Media? US Population 18% create content 25% critique content 12% collect information posted by others 25% join on-line communities 48% are considered spectators 44% are currently inactive Source: Groundswell by Charlene Li and Josh Bernoff

39. The Future of Social Networking People from 35 to 54 now represent the biggest group of users on Facebook 99% of Gen Y have one or more active profiles on social networks such as Facebook or MySpace Source: strategy Labs; PMN together with the Interactive and Direct Marketing lab at Pace University’s Lubin School of Business, May

40. Case Four: Tinker Federal Credit Union Business Problem Low enrollment of Gen Y customers Business Solution Created a multi-channel campaign “Buck the Norm” as a rallying cry for young people to get over what everyone else was doing and to get smart with their money.

41. Solution Components New web site relevant to Gen Y audience Video Scholarship Contest for Engagement Ringtone, Wallpaper, Buddy Icon downloads TV and Direct Mail Marketing Reinforce with social media using Facebook, IM, Twitter, online voting, local bands music players, and contests “Save the Buck” promotional cards given out at college hangouts and coffee shops that would cover their bill Attendance in community events geared toward young adults

42. Multiple Channels: Direct Mail, Web Site, TV, Video, Social Media

43. Results 35,000 web site visitors Average of almost 4 pages viewed per visit ‘Buck the Norm’ video on YouTube viewed by almost 1,500 people Facebook event page for the scholarship contest visited over 3,000 times

44. Traditional Sales Funnel

45. Why Social Media?

46. Case Five: 5,000 Member Credit Union in Northeastern US Business Problem Statements which were labor intensive, inflexible, and prone to quality errors Call center activity disproportionately high due to errors and the confusing statement Business Solution Redesign of statement with highlight color to improve readability and incorporate cross channel tracking in promotional messaging

47. Solution Components Highlight color statement Targeted promotional messaging based on member’s existing relationship Reinforcement from social media using blogs, facebook page and tweets

48. Results 30% of customer base converted to electronic statements saving the credit union $30 per member Approximately $45,000 per year initially 18% of members are following credit union’s tweets Estimated reduction in other marketing expenses of $30,000 per year

49. Review New technologies exist to improve the efficiency and effectiveness of marketing efforts 67% of what you are currently spending could generate better results by modifying the tactics 19% of what you do fails outright Opportunity exists to capture opportunity without increasing spend

50. Combine direct mail or statements with targeted messaging relevant to the member Reinforce direct or statement marketing with email Use links to relevant services to track changes in behavior Reinforce strategy and social media presence Encourage members to share reasons for their satisfaction turning them into ‘promoters’ Email and landing page tracking allows you to capture and integrate best practices quickly for maximum ROI Review

51. Review your current member data % of emails and current baseline deliverability statistics Opens Bounces (hard and soft) Click Throughs Develop a fun way to capture emails from members Determine best segments given current economic climate Start thinking about right social media to use Community Blog Etc. Read Groundswell by Charlene Li and Josh Bernoff First Steps

52. Immediately following the webinar you will receive an email so you can download a copy of today’s presentation and a white paper called Beating the Odds: Credit Union Marketing Questions?

53. Thank You! Questions After the Fact: 804 377-6070 Kate.dunn@digcreative.com