Upcoming 2002 National Member Survey Report Points to Best Prospects for Remote-Banking Services

By Jon Haller
Director of Market Research,
Credit Union National Association

Anybody interested in generating less costly and more effective marketing campaigns? It used to be you couldn’t achieve success without sizeable marketing investments. But no more. Enter the "target-marketing matrix"—a valuable guide to identifying the groups of members most apt to be seeking each of your individual products and services.

One such target-marketing matrix, which can be found in CUNA’s upcoming 2002 National Member Survey report, points to young members and/or members with moderately-high to high household incomes, regardless of age, as the strongest prospects for three remote-banking services—Internet banking, debit cards and online bill payment.

When conducting your next member survey, seek out vendors capable of developing a target-marketing matrix based on your own members’ financial behaviors, as your individual credit union’s target-marketing index scores could differ—somewhat or even more so—from the nationally-based scores provided in this article.

What’s behind the target-marketing matrix concept? Groups of members with similar combinations of age and household income often experience the same types of life events—e.g., marriage, the purchase of a home, the nearing of retirement, an increasing desire to access accounts via remote means, etc. As a result, they also tend to share similar financial behaviors, service needs and usage patterns. These groups are typically referred to as "lifecycle segments" or simply as "age and income segments."

Designing, targeting, and mailing promotions to those lifecycle segments that are the strongest prospects for your various products and services yields many benefits for your credit union:

• tremendous cost savings (through lower printing and postage costs),
• reduced staff workload, as you avoid having to sort through countless inquiries and applications from members who clearly don’t qualify,
• increased marketing effectiveness,
• greater returns on your promotional investments,
• increased member use of your services,
• and, ultimately, an improved "bottom line" for the credit union.

The key to effective lifecycle marketing is the aforementioned "Target Marketing Matrix". The underlying premise is this: The most efficient way to identify potential users of a particular service is to identify the characteristics of those members who are currently using that service somewhere, then finding others in your membership who are "just like them."

Then, by using your MCIF (Marketing Customer Information File) or your membership database, you can assemble your mailing list using only the "highest-potential" lifecycle segments for your particular direct-mail promotion.

The outcome? You get more bang for your marketing-budget buck. Who could argue with that?

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