Jim KaschFebruary 14, 2015

REENGAGING YOUR SPONSOR

How We Got Here Affi nity Marketing Affi nity Marketing for Credit Unions Three Levels of Business Development Executive Responsibilities

Sponsor / Credit Union Value Cycle Executive Updates Demonstrating Value Value-Add Programs Advisory Committees Share the Credit

AGENDA

In the beginning… Credit unions formed with the help of actual sponsors as a

cooperative to assist employeesOver time…

Credit union leaders grew lazy in managing sponsor relationships; we grew entitled

Until… What employers thought of as an asset became a liability “No cost benefit” became a “no value” proposition

And now… Sponsors “abandon” credit unions, and credit unions graze

elsewhere

HOW WE GOT HERE

Who’s at fault?

Reengage sponsors through relationships that demonstrate value to the organization

Creatively build partnerships between the credit union and the sponsor

Redefine the credit union’s value proposition in ways that resonate with sponsors and their leaders

Get out of the offi ce and meet them face to faceHard workEmbrace our greatest competitive advantage – the

affi nity between the credit union and the sponsor

HOW DO WE FIX IT?

“An individual level of cohesiveness, social bonding, identification and conformity to the norms and standards of a particular reference group” – (Macchiette & Roy, 1992)

Four aspects of affi nity1. The support of a deserving cause (Sympathy)2. Creating a sense of recognition (Relational)3. The desire to be a part of a dissimilar social group

(Aspirational)4. The wish for acquiring special privileges (Self-interest)

Features of affi nity marketing Third party endorsement, either explicit or implicit Shared incentives Enhancement of products and services

AFFINITY MARKETING

Competitive advantage Lower cost of account acquisition Higher lifetime value through improved retention Operational effi ciencies for more accurate target marketing Deeper understanding of consumers

Brand affi nity & validation Implicit or explicit endorsement from employer

Leverage Access to employees that competitors can’t purchase Communication channels, events, etc.

BENEFITS OF AFFINITY MARKETING

BANKS WANT WHAT YOU HAVE

Employers can be identified as affi nity groups that have positive or influential relationships with a group of consumers

Employers have better access to these consumers than can be achieved through normal marketing channels

Affi nity can be demonstrated in various ways: Branding – Credit union name, logo, colors, lexicon Locations – Access to services near or on-premises Cooperative campaigns – Active partnerships through copy

and/or event (Car Sale, Pre-Qualification, etc.) Daily business activities – Members interact with CU more

often than company HR team. Can you help distribute company notices (open enrollment, holidays, etc.)?

AFFINITY MARKETING FOR CREDIT UNIONS

Executive

Functional

Tactical

Executive – Open doors, build relationships

Functional – Manage and coordinate events and campaigns

Tactical – Execution of plans

THREE LEVELS OF BUSINESS DEVELOPMENT

CEO

VP/Mgr

BD Team

Sponsor / Credit Union Value CycleExecutive UpdatesDemonstrating ValueValue-Add ProgramsAdvisory CommitteesShare the Credit

EXECUTIVE RESPONSIBILITIES

Sponsor

Credit Union

Employees

SPONSOR/CREDIT UNION VALUE CYCLE

The credit union value proposition delivers superior value, convenient access, and

differentiated service to employees, which increases participation and improves

cooperative performance, allowing more investment

The sponsor endorses the credit union as a valuable

benefit and preferred business partner.

The sponsor is recognized as a caring and thoughtful employer, and in

addition may realize:

• Credit for positive financial impact to employees lives

• Savings through reduced turnover• Service from a trusted business

partner• Increased revenue

• Improved employee morale

Leader to Leader CEO to Highest Ranking Person

Quarterly Meetings Breeds familiarity

Updates on CU Operations As they pertain to the employees of the company specifically # of employees being served Types of services – new services – new locations Member feedback

Updates on Company Operations Major initiatives / pain points How can credit union help

The ask How can company help credit union help employees

EXECUTIVE UPDATES

BANK CU

Ave Savings Balance $5,000 $5,000

Interest Rate 0.01% 0.50%

Ave Annual Fees $375 $125

Auto Loan Balance $15,000 $15,000

Auto Loan Interest Rate 4.95% 2.95%

Annual Loan Interest $682 $404

Credit Card Balance $7,500 $7,500

Credit Card Rate 19.95% 9.95%

Credit Card Interest $1,497 $746

TOTAL INTEREST EARNED $0.50 $25

TOTAL INTEREST/FEES PAID $2,554 $1,275

CREDIT UNION DIFFERENCE +$1,304

DEMONSTRATING VALUE

Current participation Percentage of current company employees who are credit

union membersTotal opportunity for savings

All employees NOT currently members times average annual savings

Access statistics Branch visits Loan applications (how many employees have asked to

borrow?) Loan fulfillments (how much have you loaned to

employees?) ATM / Online / Mobile interactions

Qualitative reporting on employee experience

REPORTING

Member Assistance Programs Natural disaster relief Layoff relief Unexpected calamities Community awareness

Employee Communications How frequently do your members access home banking? How frequently do they interact with your team? Leverage the credit union for employee communications

Formal Programs that Enhance Employees’ Lives Pre-Qualification campaigns

VALUE ADD PROGRAMS

Pre-qualifi cation campaigns By sharing high level non-

member data, the employer can help you save thousands of dollars for its employees

Non-disclosure/privacy agreements can be signed

Data can be shared directly with third parties

Pre-qualify for vehicle loan refinance opportunities

Send mailers under joint name so employer gets the credit

If you do not have this type of relationship yet with the sponsors, you need to get there.

WIN CUBED

Refinance

Campaign

Sponsor

Credit

Union

Employee

Member Service Advisory Committees Volunteer committee with tight affi nity relationship Quarterly meetings with 2-way conversations

Updates from credit union Updates from business unit

How can the credit union support the business unit?Farm system for future Directors

ADVISORY COMMITTEES

Share every instance of positive member feedback Thank the member and ask them to thank their employer

for making credit union services available to themCraft larger narratives out of actual member feedback

These can help you articulate the need for sponsor support in non-traditional ways “Did you realize the average employee saves more than $1,000

a year by banking with us versus the local banks? How do we extend this value to the rest of your employees?”

Share interaction summaries with the employer “Your employees use ATMs an average of three times per

month, per person. If you can help us understand better their expectations, we can provide better service. The employees would like an additional ATM at your other location.”

SHARE THE CREDIT

Jim Kasch407.245.4301

QUESTIONS